Vulnerable households worst-hit by COVID-19, in dire need of FG’s Social Investment Programme

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Vulnerable families have been impoverished and devastated by the harrowing experiences brought upon them by the scourge
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Written by Mercy Christopher

Given the importance of a conscious implementation, succeeded by a meaningful outcome, to the sustainability of any Intervention programme, the Federal Government’s plan to transmute its National Social Investment Programme (NSIP) into a new Integrated National Social Investment Programme (I-NSIP), may not amount to much beyond the rhetorics, if the government fails to focalise the programme on the most vulnerable Nigerians in the present COVID-19 era. The advent of the COVID-19 pandemic and the devastation it has brought upon Nigerians, could invariably mark a defining moment for the NSIP. The pandemic has negatively affected the Nigerian economy, causing an unprecedented inflation across the country which has sunk a lot of indigent Nigerians, deeper into poverty. These vulnerable ones who have been impoverished and devastated by the harrowing experiences brought upon them by the scourge, are presently the symbol of acute poverty, in the year 2020. They are currently in serious need of the government’s interventionism, to enable them find their bearings in the new COVID-19 era. Most of these people are the bread-winners in their households. What better way can the government ameliorate the hardship of those poor households who were taken unawares by the novel pandemic, than to ensure that the NSIP is re-engineered to incorporate them and provide urgent remedies for their benefit?

 

The NSIP, which was established in 2016, includes the much-touted intervention scheme known as N-Power, which is sub-divided into N-Power Teachimg, N-Power Agro, N-Power Health, N-Power Community Education and N-power Creative schemes, and is mainly focused on developing human capacity and solving the youth unemployment crisis in the country. The Government Enterprise Empowerment Programme (GEEP) is another NSIP, which consists of the Trader Moni, Market Moni and Farmer Moni schemes, created to make available interest-free grants to traders and small-scale entrepreneurs to help boost their businesses and buoy up the economy. Under the N-Power teaching, N-Power Agro and N-Power Health, beneficiaries are paid between ₦28,000 and ₦30,000, while in the N-Power Community Education and N-power Creative schemes, beneficiaries receive ₦10,000 to ₦30,000 monthly. These stipends are urgently needed by the poor and vulnerable households that are worst-hit by the COVID-19 pandemic, to cushion the effects of the pandemic such as, inflation, loss of jobs and risk to health, to state a few.

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Nigeria is faced with socio – economic challenges such as hunger, poverty, unemployment, out-of-school children etc

Another segment of the society deeply affected by the COVID-19 outbreak, is that of local businesses and small-scale entrepreneurs, such as farmers and business owners. This is the sector for the Micro, Small and Medium Scale Enterprises (MSMEs). Though COVID-19 has had an impact on almost all businesses, irrespective of size, the impact on MSMEs is especially severe due to their higher levels of financial vulnerability and lower resistance to economic crisis. The hardship experienced by most Nigerians whose sources of livelihood were severed as a result of the lockdown measures in the earlier months of the pandemic, highlights the need for social protection in Nigeria. With a good number of the workforce especially in the informal sector lacking savings to facilitate self isolation and most people lacking basic necessities to survive a lockdown, the poverty experienced in the country has escalated, alongside its inflation rate.

Nigeria has since 2018 remained the country with the highest incidence of poverty in the world. According to the Nigerian Bureau of Statistics, more than 82 million Nigerians are trapped in extreme poverty, living on less than $1 a day as of May, 2020. Sadly, this figure is likely to increase, as the COVID-19 pandemic is expected to push more people further into poverty. World Bank estimates that COVID-19 will push 49 million people globally into extreme poverty in 2020. In that figure, Nigeria accounts for 5 million people who will be pushed into extreme poverty according to the estimates. This is excluding the number of struggling people who live above $1 dollar a day ($3.20 – $5.50 per day) but are still living on the verge of poverty. The World Bank projection states that 100 million people who are in this class, will be pushed into poverty.

The NSIP which was established to tackle poverty and hunger, is usually funded in diverse ways, as ensured by the government. In 2016, a $500 Million credit was granted by the World Bank for the NSIP. In 2017, $322.5 Million Abacha loot recovered from Switzerland was appropriated to the NSIP, in addition to the yearly budgetary appropriation of ₦400 Billion (which at the commencement of the NSIP, was an initial sum of ₦500 Billion, appropriated in the 2016 federal budget). Although the intervention scheme has in recent years, been faced with criticisms by several stakeholders, as to the reported lack of transparency and accountability in the implementation of the respective schemes which the programme embodies, the biggest challenge to the effectiveness of the scheme has been, to ensure it positively impacts a vast majority of the most vulnerable individuals and households in poor communities. The Federal Government has maintained that the programme, as of September 2019, benefited 1,491,296 poor and vulnerable households comprising of 6,056,872 individuals, in 33 states. Assuming these figures are factual, it suffices to state that the reach of the programme is still highly limited when compared to the number of people living in poverty.

The Conditional Cash Transfer (CCT), one of the programmes under the NSIP, is targeted at poor and vulnerable households who are given a monthly sum of ₦5,000 to improve their nutrition and standard of living. The aim is to lessen the rate of poverty in Nigeria. The GEEP schemes are focused on MSMEs, with the aim of accelerating the growth of these MSMEs through access to credit. The programme provides interest-free loan facilities to petty traders, artisans, market women, traders and farmers under the class Trader Moni (for petty traders), Market Moni (for SMEs) and Farmer Moni (for farmers). Beneficiaries within Trader Moni and Market Moni receive collateral-free loans within the range of ₦10,000 to ₦300,000 while those in Farmer Moni receive loans as high as ₦2,000,000. The interest-free loans provided through the GEEP schemes could make capital accessible to businesses struggling to remain afloat and also cover for the extra cost of production accruing as a result of the pandemic. This will promote economic growth and also ensure that majority of the workforce do not lose their jobs.

The N-Power programme on the other hand, is targeted at persons within the ages of 18 to 35, providing training and a monthly stipend of ₦30,000 to unemployed graduates and non-graduates who in turn, contribute their skills to the development of their communities through teaching, provision of health services, agricultural extension services, tax education and other services that suit their qualifications. These programmes could be leveraged to minimise the impact of COVID-19 presently and in the near future. The N-Power scheme could serve as a safety net to help retrenched workers transition into paid-employment, while they at the same time, add value to themselves and the community at large. The programme could also train other unemployed persons on the skills that will be useful to them, as they strive to eke out a living in these testy times.

The NSIP is presently most – suited for combating the socio-economic impacts of COVID-19 and the Nigerian government needs to be more strategic in prioritising and implementing the Intervention programmes in the country. This approach will go beyond minimising the impacts of COVID-19, to actually promoting inclusive growth and diversification of the economy. As emphasised by the International Monetary Fund, the poor and middle – class, matter the most for growth through economic and social channels as an increase in the income share of the bottom 20 percent (the poor), is associated with higher GDP growth. The NSIP has the potential to tackle the emerging socio – economic challenges Nigeria is faced with due to the pandemic, as it addresses hunger, poverty alleviation, employment creation, child education, agriculture, local production, and also promotes small and medium businesses. What the government needs to do, is to re-assess the programme, create a legal framework that makes the programme accessible to those in urgent need of government’s intervention due to COVID-19, and ensure transparency and accountability in its implementation.

 

References:

https://blogs.worldbank.org/opendata/impact-covid-19-coronavirus-global-poverty-why-sub-saharan-africa-might-be-region-hardest

https://www.imf.org/en/Publications/Staff-Discussion-Notes/Issues/2016/12/31/Causes-and-Consequences-of-Income-Inequality-A-Global-Perspective-42986

https://www.premiumtimesng.com/news/more-news/397126-fg-considers-reducing-n-power-internship-period.html

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