Vice President Yemi Osinbajo says the government wants to rationalise spending to free up fiscal space for its N2.3 trillion economic sustainability plan, but this plan does not include cutting the pay of political officeholders. 

Mr. Osinbajo spoke on Thursday at an Africa Report webinar describing the Buhari administration’s plan to restore growth in the economy.

Responding to a question from Peoples Gazette, Mr. Osinbajo said, “[We] could not recommend salary cuts because salary cuts are done by recommendations from the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC). There is a whole process for doing that, although voluntary salary cuts were done by the House of Representatives.”

RMAFC is a federal government agency responsible for setting the salaries and other pay of political officeholders such as legislators, ministers and their appointees.  

Nigeria gets more than half of its revenue from oil, but its oil revenue has declined by more than 80% this year due to headwinds caused by the pandemic. In June, the government began cutting petrol subsidies and allowed electricity firms to increase tariffs in September. 

While the country struggles and the Nigerian people deal with rising fuel and electricity prices amid high inflation, the government has proposed no clear plan to reduce the cost of governance, especially the pay of political officeholders. 

Nigeria operates a large government with over 700 federal parastatals and agencies and 43 cabinet ministers – alongside their numerous special advisers/assistants.  

India has 1.3 billion people but less than 800 national legislators. On the other hand, Nigeria’s parliament has nearly 500 national legislators even though the country’s population is seven times smaller than India’s.

In June, the Buhari government announced its economic sustainability plan in which it proposes to stimulate the economy by increasing spending on housing, construction and agriculture. However, the government cannot afford to fund this plan and it intends to borrow more than 75% of the cost from the central bank.