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Thursday, 25 October 2018

RADICAL UNCERTAINTIES - By Bashorun J. K. Randle


On 1st October 2018, the retired partners of KPMG who are still awaiting their gratuity and pension were gathered in Abuja to celebrate Nigeria’s 58th Independence Anniversary as guests of President Muhammadu Buhari GCFR and also participate in the 48th Annual Conference of the Institute of Chartered Accountants of Nigeria [ICAN].

Alas, as we drove from Nnamdi Azikiwe International Airport into town, we were confronted by huge billboards of President Buhari who is bidding for a second term in 2019.
However, there were other bill boards (sponsored by XKPMG and Grant Advertising Nigeria Limited) contending for space and attention:
(i) Chief (Dr.) Sylvan Olisanye Ebigwe (Vice President-General, Ohanaeze Ndigbo (Worldwide); President Emeritus, Aka Ikenga; Consultant Dental Surgeon and the Iyasei Onowu (Prime Minister), Agbadagba, Okpanam, Delta State):
“Nigeria is practising primitive democracy (revenge and retaliation) with some primitive minded individuals in the field. They don’t have the love of this country at heart. Why should people kill and maim others in order to come and serve a nation?”

(ii) Jeff Rich
“The one thing we know about the future is that it comes one day at a time.”

Bashorun JK Randle

(iii) Dr. Chukwuemeka Ezeife, former Governor of Old Anambra State:
“Nigeria is a total failure and Nigeria may be inching towards extinction the way things are going. An Igbo man has never ruled Nigeria for one day, no elected Igbo President for one day. (Major-General Johnson Aguiyi Ironsi was a military leader and he lasted only six months). Therefore, if by chance Dr. Kingsley Moghalu gets it, nobody should complain.

(iv) Professor Neal Hartman, Massachusetts Institute of Technology:
“In this volatile, unstable, complex and ambiguous operating landscape, to survive and thrive, Nigerian leaders need to make innovative impacts in their organisations in several ways.”

(v) “Daily Sun” newspaper
“IMF’s TIMELY WARNING”
“The International Monetary Fund [IMF] recently warned Nigeria and other sub-Saharan African economies to urgently check rising debts and diversify their revenue bases. It advised that they should not delay such reforms because of rising oil prices in the international market as the ‘good times’ would not last for long.

Specifically, the IMF warned the Federal Government to check the rising levels of debts and deepen diversification efforts and revenue base. Failure to heed the warning could result in serious economic crisis. This is not the first time this year that IMF has warned Nigeria of the likelihood of debt crisis, its latest warning came at the IMF/World Bank annual meeting in Bali, Indonesia, during which it unveiled the World Economic Outlook entitled, “Challenges to Steady Growth.”

We urge the government to critically examine all the areas of the economy that the IMF has raised concerns and initiate far-reaching reforms that will stimulate sustainable growth.

We agree with IMF that looming debt crisis, occasioned by frequent borrowing without deploying such funds to productive sectors, the need to enhance the non-oil revenue mobilisation and proactive banking supervision, are some of the challenges the government must quickly address. For instance, Nigeria’s debt stock reached N22.3trn as at June 30, 2018. About two-thirds of the government’s revenues are reported to go into servicing interest payments, with the principal still awaiting redemption at maturity. In 2017 alone, N1.8trn was spent by the Federal Government on debt servicing, out of which N1.455trn went into domestic debt servicing.

We recall that President Muhammadu Buhari is seeking the approval of the Senate for a fresh $2.86bn external loan for part-financing of key infrastructure projects, and another $82.54m from the international capital market to refinance the balance of $500m mature Eurobonds.

In all, the fiscal plan recorded N2.426.73trn shortfall, according to figures from the Budget Office of the Federation (BoF). The Economic Counsellor of IMF, Mr. Maurice Obstfeld, observed that the Nigerian economy and those of other sub-Saharan African nations may witness growth rebound as a result of the current high oil prices, but warned that rising borrowing levels will likely vitiate the gains. This, therefore, calls for boosting non-oil revenues and fiscal consolidation plans. Such fiscal buffers will make room for policy responses in the likelihood of the “next recession” that awaits countries that fail to plan against the ‘rainy day.’

In spite of the Federal Government’s assurances that its borrowing plan is still within the acceptable threshold as well as its commitment to diversify the non-oil sector, we are inclined to side with the IMF position that our economy is yet to receive a significant boost from policy implementations that can truly withstand the shocks that pushed it into recession a few years ago. The IMF and the World Bank had insisted last year that the fanfare that greeted Nigeria’s exit from recession came on the heels of new foreign exchange measures by the Central Bank of Nigeria, rising oil prices, attractive yields on government securities, a tighter monetary policy regime and increased external reserves. But some of these are on the reverse gear now.

No doubt, Nigeria’s fiscal challenge is about revenue shortfalls and lack of wise investments of available resources in critical projects that can stimulate growth. Borrowing is not bad, it is how such loan is deployed into productive sectors that matters. Statistics from the BoF and the Debt Management Office (DMO) show that the ratio of interest payments is rising in great proportion. Therefore, the government should be careful about issuing debts in international capital market as it is currently doing.

Available statistics also support IMF position that Nigeria is still retaining higher fiscal deficits, driven by weak revenue base. Therefore, it has become imperative to enhance financial resilience through proactive banking supervision, by ensuring adequate provision for losses and improving resolution frameworks that will keep expensive public bailouts at bay and foster a financial system supportive of Nigeria’s economic growth.

There is creeping concern that the forthcoming general election may make the government pay less attention to the economy. That will further slow down growth projection which is currently 1.9 per cent. Government should heed the IMF warning and come up with measures that will stimulate economic growth.”

(vi) Reverend Matthew Kukah, The Catholic Bishop of Sokoto Diocese:
“Nigerian presidents are the most irresponsible and most reckless in the world. The structure of the Nigerian presidential office makes the holders of the office extremely powerful, so much so that he (or she) can deploy power the way he (or she) wants. Unlike American presidents, who do not emerge by circumstance, from inception till date, all Nigerian presidents were virtually dragged into office. No president in the world has the kind of power the Nigerian president has and as such, no president in the world can be as irresponsible as the Nigerian president.

His power is so much that he can give an oil block to his girlfriend and many others. You can’t be a man of honour and live in a country like Nigeria and not be angry.”

(vii) Dog Owners Association of Nigeria
“The country has gone to the dogs. If Nigerians refuse to vote, dogs will vote on their behalf.”

(viii) Reuters:
“DOG OWNERS MARCH ON UK PARLIAMENT DEMANDING NEW BREXIT “WOOFERENDUM”
“Around a thousand dogs and their owners marched on Britain’s parliament on Sunday demanding an end to Brexit via a second vote on the terms of the country’s exit from the European Union.

Organisers of the so-called “Wooferendum” campaign argued that animals would suffer from leaving the EU, saying there would be a shortage of vets and a rise in pet food costs.

Bulldogs, both English and French breeds, were among those walked through central London to Parliament Square. One grey Schnauzer wore a homemade banner declaring “Brexit’s Barking Mad”.

The march backed a wider campaign for a ‘People’s Vote’ on Brexit, at which Britons would have the chance to vote on whatever Brexit deal Prime Minister Theresa May is able to bring back from Brussels.

At several ‘Pee Stations’ along the route, dogs were encouraged to urinate on images of Brexiteers like former foreign minister Boris Johnson and ex-UK Independence Party leader Nigel Farage - key faces in the 2016 Brexit referendum campaign.”

(ix) President Muhammadu Buhari
“My Government Will Give Account Of All Financial Transactions.”
“We shall render account of what comes into the coffers of government as well as what goes out.”

(x) John Quincy Adams (late President of the United States of America)
“If you inspire others to dream more, you are a leader.”

(xi) Ebun-Olu Adegboruwa
“In all the places where the sham party primary elections were held, it was impunity, violence, thuggery, brigandage and total lawlessness, all through.”

(xii) Mr. Festus Keyamo, SAN
(Director, Buhari Campaign Organisation)
“What happened under the PDP (People’s Democratic Party) government was that they were paying for petroleum products that did not land in Nigeria at all. That was the scam that was going on. It was fraud. The greatest stealing in the history of this country happened under their watch. All the PDP bigwigs were involved in the subsidy scam.”

(xiii) John Campbell (former Ambassador of the United States of America to Nigeria)
“Muhammadu Buhari won all the last three elections (2003; 2007 and 2011) in Nigeria but was rigged out!!”

It was against this overwhelming arc of radical uncertainties that the retired partners of KPMG subsumed discussions over their unpaid gratuity and pension (which was to have been vigorously debated at the United Nations General Assembly that was held in New York from 18 September – 5 October 2018 but for the last-minute appeal from Mr. António Guterres the Secretary-General of the United Nations that the matter should be deferred till next year). Mr. Guterres used to be the United Nations High Commissioner for Refugees (2005–2015), hence he has been particularly concerned that former KPMG partners do not join the queue of refugees!!

When we learnt that President Buhari would not be personally present to declare the ICAN Conference open, we protested by forsaking the Independence Day Banquet at the Villa, Aso Rock.

Instead, we took it upon ourselves to assess the erosion of the clout and might of Chartered Accountants in the national landscape, particularly in the economic/financial sector.
In previous governments, Chartered Accountants dominated key positions such as:
- Minister of Finance
- Governor of the Central Bank
- Minister of Planning and Budget
- Auditor-General of the Federation
- Accountant-General of the Federation
- Chairman, Federal Inland Revenue Service
Not so anymore. The current Auditor-General of the Federation, Mr. Anthony Mkpe Ayine is the only Chartered Accountant amongst the list of those holding those positions. To further compound matters, Governors who are Chartered accountants – Alhaji (Dr.) Ibrahim Hassan Dankwambo, FCA (Gombe State); Otunba Ibikunle Amosun, FCA (Ogun State); Mr. Willie Obiano, FCA (Anambra State) and Mr. Akinwunmi Ambode, FCA (Lagos State) had not shown up.

Even a private audience with President Buhari by the retired partners of KPMG was not confirmed.
Also, unlike in previous years, the President, Alhaji Razak Adeleke Jaiyeola and members of ICAN would not be hosted in the Villa by President Muhammadu Buhari. It took almost three weeks before President Buhari received the ICAN delegation at the villa on 19th October, 2018.

Without mincing words, it was indeed strange that considering that almost five thousand chartered accountants were in Abuja for the conference, the President could not be persuaded that it was an excellent opportunity to launch a charm offensive and woo the votes of not only the delegates and spouses but also the vast network of Chartered Accountants (and their dependants) all over the country at a time when the next presidential election is only a few months away.

There is rage everywhere. News media have been streaming the complaint of Mrs. Aisha Buhari, (Wife of the President and First Lady of Nigeria):
“It is disheartening to note that some aspirants used their hard-earned money to purchase nomination forms, got screened, cleared and campaigned vigorously yet found their names missing on Election Day. These forms were bought at exorbitant prices.

All Progressive Congress [APC] being a party whose cardinal principle is change and headed by a comrade/activist [Adams Oshiomole] whose main concern is for the common man, yet such impunity could take place under his watch.”

Ironically, there appears to be an international dimension to our angst and frustration.
On CNN an elated Sarah Campbell of the New Democratic Party of Ontario was jubilating over the legalisation of cannabis (Indian Hemp) as a recreational drug in Canada.

It turns out that by sheer co-incidence there has been a spike in the flood of Nigerians who have decided to emigrate to Canada!! One of the brand new and young presidential candidates, Omoyele Sowore has disclosed on CNN that when he becomes President of Nigeria he will not only legalise marijuana, he will declare it as Nigeria’s number one export earner which will rapidly surpass crude oil.
Amongst the fleeing brethren are doctors, engineers, professors/lecturers, chartered accountants (including retired partners of KPMG)
They appear to have concluded that Nigeria is a slow-moving disaster and that the deluge of bamboozling by politicians and hoodwinking by their cohorts are just driving the country to breaking point and there is nothing the retired partners of KPMG, (who are still awaiting their gratuity and pension) can do about it. they cannot even get to meet their old pal President Muhammadu Buhari.

Such a meeting would have served as an excellent platform to remind the President that we are of the same age (seventy-five years) and he is our Ambassador Extraordinary and plenipotentiary armed with our Letter of Credence to the succeeding generation and a special message: “There is nothing to be gained by setting the country on fire.”

Here we are on home turf but the politicians are holding the entire nation to ransom with their subversive inertia. We are not here to pursue lucrative government contracts or ask for favours/waivers. It is our love of our country and our fervent patriotism that are the driving forces behind the zeal to encourage those in position of power and authority to press the reset button instead of tormenting the nation while Boko haram and other terrorists/insurgents hold sway with ruthless kidnapping, callous beheading, vicious armed robbery and bestial rape as their weapons of choice.

For almost fifty years, we have watched the massive plunder of our nation’s treasury and commonwealth through barefaced brigandage and reckless impunity. What we are now witnessing is a profound shift in strategy – from brazen exploitation to indifference. The tactics are obvious – just ignore them and thereby ensure that poverty, hunger, ignorance inflict sufficient damage to render the victims both hopeless and homeless.

The retired partners of KPMG are not obliged to join the politicians. Rather, what beckons is the duty to line up behind all those who are in the queue for their gratuity and pension according to the front page of “Business Day” newspaper:
Headline: “FG RETIREES STRANDED OVER N67 BILLION UNPAID PENSION
“Federal Government employees who retired from service since August 2017 to date have been left stranded as they are unable to access their pensions for retirement.

This is following the inability of the Federal Government to pay pension accrued rights now totalling over N67 billion, which adds to total pension accumulations of the retirees to enable Pension Fund Administrators (PFAs) managing the Contributory Pension Scheme (CPS) to pay them.
Sources at the National Pension Commission (PENCOM) have told BusinessDay that the accumulation is due to poor budgetary provision by the Federal government as well as the delay in release of approved funds to enable PFA’s commence payment to the retirees.

Farouk Aminu, Director Supervision, National Pension Commission (PenCom) confirmed at a retreat organised by Pension Fund Operators Association of Nigeria (PenOp) for members of the Joint Committee for FG retirees stranded over N67bn unpaid pension Establishment and Public Service of the Senate and House of Representatives Committee on Pensions held in Calabar, that the last payment only covered August 2017.
He had disclosed that “From 2014, the amount needed to pay accrued rights was slashed by two thirds, so we were given just N2.5 billion from January 2014. So by the time 2014 ended we only paid pension up to June 2014 and since then we are yet to recover. And payment normally is on first come, first served basis so we don’t jump and because we have to follow this sequence and this year unfortunately, we had this issue and as at December 2017, the amount paid was still short of what was to be paid and again from January 2018 we have not been receiving the accrued pension because of budget delay.

The National Assembly just passed the budget in June and it was signed into law in July or so. So, it is when we are able to get this money that we will be able to pay. In essence, the Federal Government has been paying. Only that the amount is not enough to cover the accrued pension liability”.
Section 15 (1) of the Pension Reform Act 2014 provides that “as from 25 June, 2004, being the commencement of the Pension Reform Act, 2004, the accrued pension right to retirement benefits of any employee who is already under any pension scheme existing before the commencement of that Act and has over 3 years to retire shall – (a) in the case of employees of the Public Service of the Federation where the scheme is unfunded, be recognized in the form of an amount acknowledged through the issuance of Federal Government Retirement Benefits Bonds by the Debt Management Office in favour of the employees and the bond issued under this subsection shall be redeemed upon the retirement of the employee in accordance with section 39 of this Bill and the amount so redeemed shall be added to the balance of the retirement savings account of the employee and applied in accordance with the provisions of Section 7 of this Bill”

On the eve of the Chartered Accountants Conference, we cannot but reflect on our status in a society that is rapidly being emasculated without any regard to the core values that serve as the glue for nation building.
We are obliged to ponder on how we capitulated so easily at the alter of intimidation and contempt to the point of becoming almost irrelevant. We cannot even pull sufficient strings to ensure that President Muhammadu Buhari shows up to deliver the opening address at our conference.

It was not so long ago that government officials used to lobby our Institute for invitation to our functions. Nostalgia.
William Shakespeare got it right:
“May cannot know the glory that went with March.”
Rather than lament, this is the time to gird our loins; mend our ways; place our nation first and reconnect with the lofty ideals of our beloved profession.

We cannot ignore the powerful messages being transmitted by the giant billboards and the intimidating full-length photographs of the messengers/philosophers:
(xiv) Chief Newton Jibunoh (Desert Fox):
“History is important because it helps us to understand the past and to predict the future, thereby enabling us to create the future we want. It also allows us to avoid repeating the mistakes of the past over and over again.”

(xv) Chief Ade Ojo (Chairman Elizade Toyota Nigeria)
“Golf is big in Nigeria at the moment. People want a course this country could be proud of. We now have one at Ilara-Mokin, Ondo State, “The Smoking Hills Golf Resort.” Let’s play it”
Holy (holey) men and women are entitled to chase holes!!

(xvi) Professor David Held (London School of Economics):
“Cosmopolitanism is completely at odds with feudalism or patrimonialism. Its enduring principles are:
- Equal worth and dignity
- Active agency
- Personal responsibility and accountability
- Consent
- Reflexive deliberation and
- Collective decision-making

(xvii) Olusegun Adeniyi (Chairman, Editorial Board of ThisDay newspaper):
“It is evident that what we have in our hands is a situation of national emergency across all sectors.

As if that is not bad enough that Nigeria was rated the country with the highest concentration of poor people in the world, the latest “Commitment to Reducing Inequality (CRI)” index released two weeks ago at the annual International Monetary Fund and World Bank (IMF/WB) meeting in Bali, Indonesia, revealed that one in 10 Nigerian children does not reach their fifth birthday, and more than 10 million children do not go to school.

These of course are problems that have accumulated over years, may be even decades, so it would be unfair to blame the current administration but the question remains as to whether they are applying the right solutions.”

(xviii) Lady Maiden Alex-Ibru (Chairman of “The Guardian” newspaper)
“If you are looking for an Angel or Guardian Angel, read “The Guardian”. Conscience, Nurtured by Truth.”

(xix) Tunde Alabi-Hudein Dudu
Special Message To Both Atiku And Buhari Camps:
“Nigerians are not interested in your tales of who’s corrupt and who is lifeless. The people are hurting. The nation needs a clear direction of how the next four years are going to be. What’s going to happen to the youth, the unemployed, the business owners, our roads, electricity, security of lives and property, education, food on our tables, water, etc.

We don’t want to know who can enter America, Aso Rock is not located in Washington; we don’t want to talk about herdsmen, no president will encourage carnage and the killing of his people. We want concrete proposals on what to do about our economy, non-payment of salaries and the welfare of 180 million Nigerians. All these PR gurus, paid bloggers, party spokesmen, media consultants for candidates etc. should just shut up and stop mudslinging.

This nonsense going on is nauseating. From now on let’s judge them (presidential candidates) on the clarity of their vision and the rationality of what they intend to do with our tomorrow!”

(xx) Archbishop Emeritus of Lagos Archdiocese and Former President of the Christian Association of Nigeria (CAN), Cardinal Anthony Olubunmi Okogie:
“Nigerians need a just President, somebody who has the love of the nation at heart, and who must fear God.”

(xxi) Clayton Christensen (Management Guru)
“Disrupt yourself before you are disrupted by someone else.”

(xxii) Professor Rebecca Henderson (Harvard Business School)
“Dominant organisations (and nations) are prone to stumble when the new technology requires a new organisational structure. An innovation might be radical but, if it fits the structure that already existed, an incumbent firm has a good chance of carrying its lead.

There are multiple points of failure. There is the problem of reorganisation. There is the question of whether the new idea will be profitable. There are cognitive filters. There is more than one kind of denial. To navigate successfully through, an incumbent organisation has to overcome every one of these obstacles.

The people who bug large organisations (and nations) to do new things are socially awkward, slightly fanatical and politically often hopelessly naïve.”

(xxiii) Tim Harford, author of the acclaimed book "The Undercover Economist"
a) “From computing giants to oil majors, big organisations often fail to embrace new opportunities, leaving the field open to pushy upstarts.”

b) “There is an obvious explanation for all of these failures and missed opportunities: people are idiots.”

(xxiv) J.F.C. Fuller
“Bad news confuses, confusion stimulates panic.”

(xxv) Joshua Gans (economist at Rotman School of Management, Toronto, Canada and author of “The Disruption Dilemma”)
“Disruption describes what happens when firms fail because they keep making the kinds of choices that made them successful. Successful organisations stick to their once triumphant strategies, even as the world changes around them. More horses! More forage!”

Bashorun J.K. Randle is a former
President of the Institute of Chartered Accountants of Nigeria (ICAN)
and former Chairman of KPMG Nigeria and Africa Region.
He is currently the Chairman, J.K. Randle Professional Services. 
Email:    jkrandleintuk@gmail.com



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