Economists Fault Tinubu’s N330bn Cash Transfer
Economic and development experts have raised serious concerns over the federal government’s N330 billion cash transfer initiative to eight million vulnerable households.
The experts warned that the initiative offers only temporary relief and does not address the root causes of poverty in the country.
It would be recalled that President Bola Tinubu, in his Independence Day broadcast on October 1, announced that under the Social Investment Programme, N330 billion had been disbursed to eight million households, many of whom have received either one or two out of the three tranches of N25,000 each.
But the experts say the intervention, though well-intentioned, lacks the depth and sustainability needed to make a lasting economic impact in the face of current economic challenges.
Economic and finance expert, Dr Aliyu Ilias, while speaking with The Sun, said the approach does not tackle the core issues plaguing the economy and the lives of ordinary Nigerians.
“Basically, as an economist, we do not believe in hand-outs. Yes, it is an intervention approach, but when you examine the impact, it merely pushes more money into the system without addressing the root issues. If you give someone N25,000 for three months, they will simply use it for immediate consumption. And after those three months, what happens next?
“There is no lasting effect. I believe the government should focus more on making the cost of living easier for people, so they naturally have more disposable income. That would lead to better outcomes and allow people to afford essential needs more sustainably,” Ilias said.
He recalled earlier hand-outs to civil servants that have since ended without significant impact, saying the government should focus on addressing deeper economic problems.
“Even the civil servants, I recall, were given that support for six months or so. It has since elapsed. So I think the government should focus more on addressing the broader economic problems.
“The progress we are seeing in the macro economy should be able to translate to real improvements in people’s lives. But for me, these hand-outs cannot actually solve poverty. They are simply too temporary in nature.
“Perhaps if you also look at the amount, can it even buy half a bag of rice? These are the questions we must ask. And beyond food, people have to pay for transport. People have to pay rent. They have to pay school fees and cover other essential needs. These are the major problems we should be solving.
“If we can get it right with food, which currently takes over 50 per cent of people’s income, and bring the prices down, I think that would make a real difference.
“Even though the government has, through different means, said they want to crash food prices, I think more needs to be done. Because the reality is, even if prices are coming down, people don’t have the purchasing power. This disposable income is simply not enough.
“So I think the government should focus more on solving the real economic problems, not just giving hand-outs to people,” the expert added.
On his part, Professor of Energy Economics and the Director of the Centre for Petroleum, Energy Economics and Law (CPEEL), University of Ibadan, Adeola Adenikinju, said while income transfers are necessary during economic shocks, concerns about implementation and data integrity must not be ignored.
According to him, “During periods of economic stress like we are experiencing now, especially after the removal of fuel subsidy, it is important to understand that such reforms have significant social impacts, particularly on the poor and vulnerable.
“Countries that have undertaken similar reforms usually implement programmes to cushion the impact and protect these vulnerable groups. Some of those programmes involve direct resource transfers, income support to the poor, because they are the most affected. And since they are already poor, you do not want them to sink deeper into poverty.
“So, income transfer or income support is typically a necessary part of that intervention. Now, in the case of Nigeria, we face issues around data. Do we have reliable data on the poor? Is the data credible? Are people using this as an opportunity to siphon government funds? Some people argue that instead of giving out money, we should be investing in infrastructure, agriculture, or roads. And that is a valid debate.
“But from what I have heard, and I cannot say this is absolutely confirmed, with the support of the World Bank, a register of the poor and vulnerable has been developed across various states in Nigeria. And that is what the government is reportedly using. If that is true, then it provides a good foundation, but I still believe we need to do more. Because despite that effort, there are still so many people who are not benefiting from this support.”
Olamilekan Adigun is a graduate of Mass Communication with years of experience in journalism embedded in uncovering human interest stories. He also prioritises accuracy and factual reportage of issues.
