Economy: 5 ways state governments can survive

That the Nigerian economy is under duress is no longer news.What is however troubling is the inability of many states to cope with the present situation, as tales of unpaid salaries by governors are now frequent in the Nigerian media.


Some state governors
Regrettably, most of these states are not financially viable and cannot cope with present challenges due to the mis-management of past and present leaders.
Some states have however proven that things can change if things are done right by those in authorities.
The case of Anambra state is one many should emulate. The South east state is not an oil producing state yet it does not take loans or owe workers salary.
And to underscore the achievements of the former governor of the state, Mr Peter Obi and his successor, Chief Willie Obiano, the state has made the best improvements in education in the whole nation and the state government even supports private schools financially.
5 ways in which states can remain financially viable and be fiscally sustainable.
Read below:
1. State governments must introduce accountability and transparency in their financial dealings
For progress to be made, the era of ‘man-no-man’ financial dealings must give way to proper accounting and transparent processes of conducting government businesses. This is to ensure that avenues for leakage and wastage are blocked and monies meant for projects and judiciously used for the betterment of the larger society.
2. Generate funds from Internal generated revenue
There is a need for state governments to deliver on the dividends of democracy, in other to have the moral right to scale up internal revenues, prosecute offenders and show the populace that their monies are being put to good use. While it is important for citizens to pay their taxes, it is equally important for governments to fufill their own side of the bargain by providing effective amenities for the benefit of the populace.
3. Improve financial management in government businesses
Government or public service must not be seen as a ‘come and chop’ affair. There is a need for those at the top level of the state apparatus, to entrench a disciplined, internationally recognised and acceptable financial management standard when they are tasked with the role of managing state funds. The implementation of the Treasury Single Account (TSA) is key to achieving this goal if those in authorities emulate their counterparts at the federal level.
4.Rationalize public expenditure
The heavy budget on public expenditure for states is to say the least financially draining. State governors initiate phantom and unrealistic projects which do not have any direct impact on the citizenry. Government’s spending is also tripled by officials who manipulate figures, demand for kickbacks and the constant presence of ghost workers in the system. Indeed, there is a need for state governments to reduce their recurrent expenditure.
5. Sustainable debt management
The era where governors approach any bank and embark on a borrowing spree has to stop. Many past and present state governors have literally mortgaged the future of their states because of their excessive borrowing and worst still, channeling the funds into projects that have no direct bearing on the improvement of the state finances. A situation where a governor borrow funds to build needless airports, stadiums and other similar wasteful projects should come to an end. States should adopt a sustainable debt profile and strive to attain credit rating.