Pension Funds: Not for Charity – Minister for power
This warning was sounded by the Minister for Power, Works & Housing, Mr Babatunde Fashola.
Fashola who spoke against misuse of crude oil proceed during oil boom, described pension funds as private capital stressing that any investment option which the fund is diverted in must be paid for utilizing. ” It was difficult to get private capital into critical sectors of our economy like infrastructure. Private capital and fund managers were not going to invest funds entrusted to them in infrastructure if we wanted to use them for free”, he said. He highlighted diversification of the nation’s economy as a way out giving continues drop in price of crude oil in the international market.
According to him, for over three decades Nigerians had been talking about need to diversify the economy but failed to come up with any functional modality, he added that they were lukewarm about it because of presence of oil which was bullish then.
For over 3 (Three) decades we have mouthed the need to diversify our economy in order to open up more sectors for productive activities, income, economic growth and jobs. But we failed to follow through because of oil resources. It was quick and bountiful income even though there were boom and burst cycles. Every time the cycle burst, we scampered, and promised to diversify, we take tentative steps, we feel pain. We do not endure, and it is easy to escape because not too far on the horizon is a boom in oil prices and we go back to an old life.
He noted that in the early 70s when oil was sold over $100 per barrel for almost 5 years, not much was done because everything was declared free in country. “Remember 1970s up to 1976; remember the early 1980s and the burst. Remember the late eighties and Gulf War boom, remember the 1990s and the drop, remember the period of 2009-2014 when oil sold for over $100 per barrel for almost 5 years. What did we do? We went on a spending spree. Politicians promised everything free. Everyone got a wage increase, sometimes up to 80% (minimum wage from N7,500 – N10,000 raised to N18,000.00). Did our income as a Nation increased by 80%?
As we sought after free health, free education, free fuel, free housing and free everything, we refused to confront the reality that life is not free”, he regretted. Fashola stated, “As a people, we were willing to pay for these services outside our country but demanded that they be provided for free in our country. But pension funds could not be used for charity”.