 We're glad to know you're still there and watching the break fast. It's a midweek frenzy and we're happy to announce that we've been joined by our guest for today, the principal partner Wood Regents called Consulting in the person of Mr. Shagun Shokwiton. Good morning and welcome to the program, Mr. Shokwiton. Good morning, Gamble. Good morning Nigerians. Thanks for having me. Nigerians really need that good morning because I hear that if you say good morning, it's a wish that you're saying I wish you a good morning. So wishing Nigerians a good morning, a good afternoon, a good evening, it's something that we all need right now. What we're talking about at this point is that the federal government is to collect value-added tax from market traders and others. And in a country where we are already facing what we are facing right now, skyrocketing, inflation, food prices are going up, transportation is something that you do not even want to imagine and all that. I'd just like to have your take on this crazy drive for funds by the federal government. Do you think it's justified? Look, it's a difficult situation. I really have to admit this. Because on the one hand, there is a desperate need for growing government finance, growing government revenues. It's desperate. Our budgets are simply nowhere near what they should be for us to achieve the type of growth and development that we need to achieve. We're running our budgets that are easily a fraction, easily maybe a tenth, or like a tenth of the type of spending we need to see to achieve the type of GDP growth rates we need to achieve in order for the country to actually develop, especially inclusive development and growth that will affect and impact the lives of the ordinary Nigerians on the street. So in order to achieve that, revenues must go up. It's just simply an imperative that is inevitable. The reason I say it's a difficult conversation is that at the same time we have certain dislocations in society. We have a certain structural imbalances with the economy that has over the years, and when I say years, I'm not talking of even two or three years. I'm saying over the decades has trickled down to the bottom of the pyramid in Nigeria where poverty is a real thing. It's a big problem for the economy. Now it's created a visual cycle where because of that poverty, the type of consumer spending that we need to see to drive investment growth and productivity is almost impossible. So the task before the president and the government, any president and any government in Nigeria is to deal, tackle the poverty problem, tackle the disposable income purchasing power problem so that that can drive the economy. So you see, we need to generate revenues, but in order to generate revenues, we need to raise taxes. You raise taxes, you impoverish the people who are ready for. So we have to think about this completely differently and I think that's where I have a problem. So the initiative to collect but from market traders, I think it's necessary. It's something that even I in my personal capacity over the years have been advocating. You know, we have a massive informal sector. Our economy as a whole is driven largely by the informal sector. The informal sector is bigger than the formal sector in the country. So if you are going to grow the economy, you have to bring a large chunk of those people trading and doing business outside of official cycles, outside of the formal banking systems who are unable to be taxed because of this. You have to bring them in into the formal sector. And that's what this is supposed to achieve. That's what, you know, collecting back from market traders, you know, and all of that's supposed to achieve. But again, my challenge is that I think we are putting the cut before the horse again. And this is the problem that we have had with policymaking and policy implementation, with the thinking of our public officials and our government over the years. And I'm not just talking this administration. I'm not talking about the Wari administration. I'm talking about the Jonathan administration. This has been a problem with Nigerian public service for as long as I can remember as a self-aware adult. We always do the right things at the wrong time, and we always expect the cut to pull the horse. It's not going to happen. So I think that the government, this government now, coming up with this initiative needs to sit back and have your rethink. There needs to be a complete strategic overhaul of the approach that they will want to adopt to achieve the objectives they seek to achieve. The objectives are good, but the approach is upside down. We are driving revenues in such a manner that will further impoverish people, kill disposable income, kill purchasing power, kill investments, kill productivity, kill manufacturing, raise inventory stocks. If you have warehouses manufactured that are producing goods that nobody is buying, inventories will rise, investments will not come. So these things are, it's a cycle and you really have to understand at what point in that cycle you need to plug in to try and fix the fundamental root problems before everything else can then begin to flow. And I think that's where perhaps we may be getting it wrong as a country, and that's where this policy for me is not the best at this time. Well, I don't know how someone can try to tackle poverty by taxing the poor. It sounds really, really weird. And I don't know if this could lead to some kind of revolt in some near future, because the market women that are going to be taxed. I can tell you for a fact that some of them go to the market and no matter how big what they are carrying to the market is, they don't make it again up to 500 naira. Their transport will have to be inside that gain. They are feeding in the market will have to be inside that gain. And what they are going to take home to their children is going to be inside that gain. And then there are taxes here and there. The tows are coming here. This one is saying it's from local government. This one is saying it's from produce. This one is saying it's from wherever. And they give you tickets out of that same gain of 500 naira. You're still paying these tickets. And then you're adding value at a tax of 7.5%. I do not know how this is going to work. And there are no alternatives that can be hard. That tax can be collected without necessarily killing the people. It's going to be a feared victory if we do that. Yeah. You're right. And I think this is the challenge. This is the intellectual challenge that this government faces. We have to think very deep. We have to think very hard. There has to be. We have to think thoroughly. The intellectual ego that needs to go into policymaking in the next year must be extensive. We can't do things knee jerk. We can't do things whimsically. We can't play to the gallery. We cannot afford to play to the gallery. I think it's important that we all recognize that we are on the brink. Nigeria is on the brink. You know that revolt that you speak about. We saw a small fraction of what could happen. February this year, February March this year, when the central bank introduced the currency redesign policy. And for a two-day period, just two days, just two days, people were unable to access the cash in their accounts. Just two days. The country was going to burn down. It was so clear and so evident that the president, who traditionally is very aloof, the former president that is now president, who traditionally was very aloof in his governor style, the country might as well be on fire. You will not hear from him. You just get some flippant statements from one of his spokespersons, maybe Shio Garaba or Femme Addition Award, through some rude remark at the citizens. He came out and spoke. Within two days of that crisis started, he addressed the country. That's how close we were. And the government recognized it. We are not far from that threshold, that breaking point. Right now as a country. Because things are getting harder. This new administration has come on board, and they seem to be focused on driving revenues and increasing government revenues to the detriment of every other variable in the equation. And that has further impoverished people. A lot of pent-up anger, pent-up frustration. You know, you can feel it. You can almost touch it. You can hear it in the conversation on the street. You can hear it when we're calling on radio. People are unhappy, they're angry, and they're waiting. So the government has to be careful. So what we need to do is to pull us back from that brink. The focus of attention must be twofold right now from the government. One is to cut waste and corruption in government business. Two is to come out with initiatives that will promote development that will encourage business growth. And when I say business growth, I mean small businesses that will attract funding for businesses from private sector, not from government. Government cannot fund business. They don't have the capacity very obviously and very clearly. So you need to come up with initiatives and programs, incentives, policy frameworks, regulation, legislation that will drive massive volumes of funds into the sectors that are desperate for funding, where productivity, creativity, innovation can be unlocked and unleashed. This has to happen as a matter of emergency. We need to create wealth. We need to drag people out of poverty. And it's not by giving out handouts and stupends. We need to create wealth, Mr. Shokutso. We need to create wealth. We have that transparency as well. You talked about corruption and all that. Because Nigerians will be saying, okay, our coffers are empty. Good. That is good. But we have been told that in two weeks, after the pronouncement of the removal of fuel subsidy, Nigeria saved $400 billion. Where did it go to? We know that in 12 months, that will be at least $400 billion because the last time the NNPC Chieftains talked about, he said a month is $400 billion, which we have been told has been saved in just two weeks. So if every month we have $400 billion, that's money coming in. Now, how about the people who are holding our money? For instance, we heard about the accountant general also, who has about $80 billion. We've heard about some money that they say they recovered from the central bank of Nigerian governor, the former, the suspended central bank of Nigerian governor. So it means we have money in the hands of people. Why are they not talking extensively about fighting corruption and recouping this money or retrieving this money from the hands of the people who are holding them? In fact, it had to take one CSO, several CSOs actually, to ask the president to categorically say something about his game plan to fight corruption because he seems to be silent about it. Why don't we explore that as well? Don't you think that's an option? Transparency, fight against corruption, collecting the money, our money in the hands of the people we already know are keeping this money? Yamgul, I think the answers may be more obvious than we realize, but I'm not going to delve into why the president has not spoken extensively about corruption. I noticed that, for example, in his Inauguration Day speech, I'm not sure if that word was mentioned once. I'm not sure. And that was quite odd. But it could be a question of personnel style. There are several ways to skin a cut. We just had a president who came in, who in fact campaigned on the platform of a fight against corruption. That was his main story. That was his main promise. And we've seen how that turned out. It was a cataclysmic failure. So this president may be deciding, I'm not going to make noise about this. I'm just going to fight it. And I think that, yes, you could want to go after people that have stolen money from the Treasury and recover those monies and punish them and put them in jail. That's good because it's a deterrent. But I think the more important thing that we need to do is to block the leakages, is to stop the corruption in its track by implementing systems and programs and policies that make it impossible. Maybe not impossible. Corruption exists all over the world. But that makes it extremely difficult to peel far, to steal, to divert government funds and to ensure that when you do, there is an evidential trail that makes it easy to convict you. This is the reason people don't steal in other countries, in other parts of the world. And of course, there is a direct correlation between corruption and development, growth and prosperity. The most corrupt countries in the world also happen to be the poorest. And this is statistically proven. You can take the Corruption Perception Index ranking, the Global Corruption Perception Index ranking, and take that table seated side by side with the per capita GDP ranking globally. And you will see an inverse correlation. The countries at the top of the Corruption Perception Index are at the bottom of the per capita income ranking. So therefore, it's an imperative that this government can't run away from, but you can choose to fight it by being noisy about it, by making a public show of it, or you can simply do it. So if what this government wants to do, if its strategy is to simply kill stop corruption in its tracks by fixing the loopholes, by plugging the holes that have been put in the pipeline of our national wealth, then so be it, or something has to be done and there has to be a communication about it. There has to be. So you are right. For CSOs asking for the government's plan is absolutely critical. So we need to plug the holes. So because if you do that, then your budget, for example, the revenues that we report as a country, 3 trillion revenues from the federal government, we can easily quadruple that by simply blocking corruption. There are numbers to back this up. So this is critical, and let's hope that the government will take the challenge and face it squarely. Another problem is that some of these things that make our money just fly away may not be termed corruption. For instance, cost of governance. Even now, the National Assembly and some other officers, national officers, they are talking about 114% increase of their salary and emoluments. So this cannot be illegal. So plugging the holes of illegal things when the legal ones are also biting us. Where do we start from to plug these holes? Do we start with the legal, crazy cost of governance or the illegal ways in which people make the money just like the present administration and give it to them has done with this fuel subsidy, even though we do not know where the money is going to? So where do we start from? Because you're cutting, you're cutting or you're blocking some loopholes and then in another place you're making it legal enough for people to siphon our money and use it for personal aggrandizements without recourse to the fact that the nation is suffering. So where do we start from? Incidentally, you know, talking about plugging the loopholes, cutting out waste and linking that with the subsidy question I think is a misnomer and it's a misunderstanding of the concept of subsidies. And I've always said, every opportunity that I've had is that it's a grievous error to remove subsidies, the PMS subsidies, the petroleum products subsidies that we've had in this country. It's a mistake. It's simply again part of the practice of putting the cuts before the horse and expecting the cuts to drag the horse. The subsidies are in place to help improve purchasing power of the people at the bottom of the pyramid. Right up to the middle class, these are the people that are going to drive growth, development and investments. You take the subsidies away because you're trying to save money for governments and you're trying to deny so-called a few privileged people from getting access to those subsidies. You're shooting yourself in the leg, you're cutting your nose to spite your face but spite us and we're already seeing it. So that's an aside because we're not talking about the subsidy problem right now. So talking about cost of governance, wastage, I think the challenge we're going to have is that to deal with these issues will require tremendous political will and tremendous amounts of personal drive and desire right from the top. You cannot cost of governance if by your own way of thinking you are not a frugal person. You have to understand that there is a certain way to live and there's a certain way not to live if you are trying not to be wasteful. So if you are used to luxury and you think that luxury is the right by virtue of the work that you have done and the status you have achieved in life, you will not be able to understand the things that need to happen in terms of cutting the cost of governance and you simply won't do what needs to be done. So I think that the will, the political will may be lacking and we will see. All of these things will play out very quickly and before the end of this year we will know what direction this government is going to take. So talking about cost of governance, reducing the number of aids that we have, reducing the number of ministers even though I understand that there is a constitutional limitation to what can be done but they are creating ways to go about these things. But you absolutely can reduce the number of aids that you appoint as the president. You can reduce the number of ministers you have. You can reduce the number of aids those ministers have. You can reduce the number of aids that governors have. You can reduce the number of aids that legislators have. If you take all of that, then we put that down to cutting of things like foreign trips, foreign trade training programs that government officials routinely organize to take money out of public treasury and pocket those monies legally. Like you said, you can look at that. You can talk about things like the convoy, the vehicles that they buy, administrative expenses can be significantly reduced if we have the will. This needs to happen. So it's a multi-percented battle that we have on our hands. You need to fight corruption. You need to fight waste. You need to drive growth. You need to drive investment. You need to try very deliberately to create wealth amongst the people at the lower rungs of the ladder. It's a multiplicity of things that need to happen. And you can therefore see that there needs to be a lot of thinking behind it. Now, once you get all of those things right, taxing the people will become easy. You will have less resistance. You will get more money from those taxes. And everybody will be happy. But there has to be the political will, the political desire to do these things. If that is lacking, you know, everything arises and falls on leadership, as John Maxwell has said. So it all starts and ends from the president. So, okay, you're putting it on the table of the president. He has to do this. Absolutely. It's because that's why we have a president. What if he doesn't have the political will to do this? And we know that things are degenerating. People are getting more and more frustrated. We have to face the facts. What if he doesn't do this? He doesn't have the will to do this. And people continually get taxed and they're not getting value for their money and all that. Because, okay, for instance, let's take Lego State as a case study. We have been told that Lego State makes like 50 billion. And if you ask the average person on the road in Lego State whether that 50 billion that they make, whether it's in a day or in a month, how it has impacted on them, I'm not sure anybody will just give you a very positive response and say, I'm really enjoying Lego's because of the kind of money that they're making. So it doesn't matter how much the government makes. It matters if the people get a feel of what governance really is. Do you think in the next one year, like you're saying, we should give time for this government to settle down to maybe like one year? Do you think in the next one year, the volatility which seems to be building up will die down because of the policy direction you think the present administration is taking? Well, sadly, the first 30 days have done one thing. It has revealed the mindset of the president and it appears to me just as an average watcher that the president is more interested in policy initiatives that speak to the traditional expectations from the private sector, the organized private sector and international investors and less interested in the opinion of the citizens of his country and maybe we can even extend that and say less interested in their welfare. So you always have to strike a balance between being a capitalist and a welfareist state. And I can tell you that even the bastion of democracies so-called and the bastion of capitalism in the world, the United States, they still have a lot of welfareist policies, a lot of them including subsidies. So you can't run a country for the markets, for the financial markets or for free markets. You can't run a free market economy exclusively in a country and think that that country will do well. So the president needs to quickly review his stance and understand that the welfare of the people is perhaps even more important than these economic policies because if we don't, then that brings us to the answer to your question. If people continue, if we continue this trajectory and people continue to feel the pinch consistently, it feels like there is a wall, two walls closing in on from both sides on them and there will be a point where there will be nowhere to move into and they get crushed by those two walls. They will push back. It's just inevitable. So this continued introduction of new taxes, continued increase in tax rates, continued introduction of new levies, talking about the renewal of your vehicle ownership certificate, for example. It's just one example of a new tax that the government has introduced. Talking about the VAT Direct initiative that we're talking about this morning, you know, is a completely new tax type, if you like, or targeting a new segment of the populace. These things, if you continue to roll out these initiatives that are talking about taxing and taxing and taking more money from the pockets of the people they will revolt. So we need to step back. I said this repeatedly, this administration is to slow down and be more holistic in their approach to the policy development process, not even the execution now, just the policy development process itself. There has to be a more holistic perspective and approach to it so that we don't drive ourselves down until we get to a wall where people will push back and then you have a revolt on your hands from the populace. Okay, I do hope that, like you said, it doesn't show much that the government is talking about the welfare of the people. I do hope that the foreign policy where it's formulated by this government should think more about the people. Mr. Chokwiton, thank you so much for being a part of our program this morning. Thanks for having me. I'm really proud of you. Yeah, so we've been talking with Mr. Shebo Chokwiton, a principal partner with Regents Court Consulting. A public affairs analyst is what we'd like to just describe him as. We were talking about the value-added tax that will be collected from market traders. We'll take a short break and when we return, we'll go to something else. Stay with us.