A leg-up from the FGN

In this year’s budget, the FGN has allocated N500bn (US$1.5bn) to social intervention projects. The government estimates that 8.4 million (5% of the country’s population) will benefit from this special intervention vehicle which is split into five categories. These include job creation, school feeding, conditional cash transfers, an enterprise programme and education grants for science and technology. The creation of jobs for 500,000 school teachers and 100,000 artisans accounts for 38% of the total cost.
The conditional cash transfer arm of the program is expected to result in a monthly payment of N5,000 to one million poor Nigerians for one year; N68.7bn has been earmarked for this. Based on local media reports, the FGN recently disclosed that about 110 million Nigerians currently live below the poverty line (i.e. survive on less than US$1 per day).

The job creation aspect of the project intends to grant soft loans worth N140bn (US$431m) in total to about 1.8 million traders and artisans. The business environment has deteriorated in view of the current macro challenges, resulting in job cuts.

According to the National Bureau of Statistics (NBS), in Q1 2016 the unemployment rate accelerated to 12.1% from 10.4% recorded in the previous quarter. Compared with the recent International Labour Organisation forecast of a global unemployment rate of 5.9% for both 2016 and 2017, Nigeria’s unemployment rate is significantly higher than the global average.

The Homegrown School Feeding Pprogramme (HGSFP) will cater to 5.5 million primary school pupils; N93bn (US$286m) has been allocated for this programme. Its first phase will begin with 18 states (three per geopolitical zone); the programme is set to kick-off next month. Contributions by state governments could drive the initiative faster. However, state governments will not be compelled by the FGN to contribute.

In addition to providing nutrition to underprivileged students, the HGSFP should create additional jobs across the value chain as local farmers and traders will be responsible for supplying the products used in preparing these meals. The FGN has disclosed that payment will be made directly to contractors, thereby eliminating potential leakages through middlemen.

As for the education grant under the social intervention project, the budget provides N5.8bn (US$18m). About 100,000 tertiary students in Science, Technology, Engineering and Mathematics are expected to benefit from the programme.

Social intervention programmes can have a positive impact on society if implemented well, but the availability of reliable data is crucial. The dearth of data in Nigeria could pose a major problem.

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