UNIVERSITY OF NIGERIA, NSUKKA FACULTY OF EDUCATION

DEPARTMENT OF LIBRARY AND INFORMATION SCIENCE

@ TOPIC &3

POVERTY AND RETRENCHMENT IN THE NIGERIAN PUBLIC @I SECTOR: A CRITICAL ANALYSIS

PRESENTED IN PARTIA FOR THE COU

BY OSUKPAI, BENJAMIN N.

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TITLE PAGE

POVERTY AND RETRENCHMENT IN THE NIGERIAN PUBLIC SECTOR:

A CRITICAL ANALYSIS

DEDICATION

I dedicate this piece of work to my father, Chief Uyo Osukpai who has

i // ' contributed in one way or the other towards making sure that I tEbp not a victim to

poverty and retrenchment.

DEDICATION

I dedicate this piece of work to my father, Chief Uyo Osukpai who has

i // contributed in one way or the other towards making sure that I not a victim to

poverty and retrenchment.

ACKNOWLEDGEMENT

First, I am highly indepted to the Almighty God for his faithfulness and

sustenance which no man can grant me. I also sincerely appreciate and thank my

lecturer, Mrs. T. Emezi who assisted me through teaching and making this work a huge

success.

Finally, my humble appreciation goes to my friends and well-wishers who have

contributed immensely through advices, encouragements and prayers so that this work

will stand a test of time.

PREFACE

This book contains all the required scheme on the topic on poverty and

retrenchment in the Nigerian Public sector. It covers up the areas of poverty seen in the

country, its relevant causes and characteristics on how we can alleviate poverty and its

possible means or solution on tackling this critical situation.

It was written to help human live beyond the expected denomination of huge and

to know their status over the circumstance on situation so as not to arise in the

formation of this concept (poverty).

It also help people who thinks that they are poor and give hope to the hopeless

ones by given a means of eradicating such a disease.

Basically, in our political environment to which it teached them on how to utilize

of financial management and administration of which will help in improving and the

standardization of the economy.

In fact, it is a work which have design for educating the public on how to live and

plan so as to avoid this dreadful disease (poverty).

In conclusion, it is good to read this book chapter by chapter with discernment so

as to understand the basic principles and it's analysis for a brighter future and to take

adequate measure against poverty.

TABLE OF CONTENTS

Title Page

Dedication

Acknowledgement

Preface

Table of Contents

Chapter One: Introduction

1.1 Concept of PovertyIRetrenchment

1.2 IndividualPoverty

1.3 Poverty in Nigerian Public Sector

1.4 Retrenchment in Nigeria Public Sector

Chapter Two: Characteristics of Poverty

2.1 Low Income and Family

2.2 Large Family Size

2.3 Low Level of Productivity

Chapter Three: Causes of Poverty and Retrenchment

3.1 Family System

3.2 Material Inheritance

3.3 Lack of Pragmatism in National Education

Chapter Four: Policy Implication of Findings

4.1 Political Instability

4.2 Solution of Remedy of Concept

4.3 Conclusion b

Reference

CHAPTER ONE

INTRODUCTION

1 .I CONCEPT OF POVERTYIRETRENCHMENT

These two concepts of poverty and entrenchment can be seen as

unemployment. The International Labour Organisation (ILO) defines it as numbers of

the economically active population who are without work but available for and seeking

work, including people who have lost their jobs & those who have voluntarily left work.

Although there seems to be convergence on this concept, it applications have been

causing a lot of problems across countries. First, most published unemployment, rates

are recorded open employment. People's attitude on this varies from country to country,

while this may be high in developed countries and where government is committed to

resolving unemployment problems which, it is likely to be very low in countries with the

opposite attributes.

Okigbo (1991) also points out the problem arising from the concept of labour

force. In most countries, particularly in Nigeria, people below the age of 15 years and

those above the age of 55,who are actively engaged in economic activities we usually

excluded 'from labour statistical surveys. All these factors have the tendency to result in

underestimation of unemployment thereby making international comparison very

difficult. . In the framework of classical economists, the supply of labour is positive

relationship with productivity. As pointed out, if there is some involuntary unemployment

, at or below the current real wage, the real wage would fail to encourage employers to

- take more labour until all involuntary unemployment is eliminated. However, if increases

in labour productivity translate to increased wages and such increase induce the

substitution of capital for labour the effect on unemployment will be positive because

poverty and retrenchment have reduced. The policy implications of this have been

viewed as misleading particularly, to developing countries.

The evidence from the economic recession of the 1980s in Africa and Latin

America clearly show that real wages declined very sharply. This period of lower real

wages agreed with high level of unemployment that the available jobs.

Contrary to the strong belief of the neo-classical that equilibrium wage rate, price,

interest rate and real cash balances guarantee the quality of national output and full

employment level, the Keynesians strongly believe in the efficiency of aggregate

demands. So there is the need to avert the negative effects of unemployment which has

made the tackling of unemployment problems to feature very prominently in the

development objectives of many developing countries. Incidentally, most of these

countries economics are also characterized by low productivity. Thus, it seems very

clear are also characterized by low productivity. Thus, it seems very clear to many

policy makers that there must be a straight forward connection between productivity and

In view of the unfolding reality coupled with the protracted debates his paper

attempts to examine the dimensions of productivity and unemployment. Specifically, it

examines the dimensions of productivity and unemployment in Nigeria as well as the

direction of the causality between them

1.2 Individual Poverty

It is the one that result from individual misfortunes or the inability to obtain the

basic necessities of life for instance, essential clothing; three meals a day that are

nutritious; a habitable house and a means of transportation either by land sea or air.

Disadvantaged urban dwellers normally called urban poor are also in this category. On

the other hand, any group, community or nation that cannot provide basic needs for its

members who are poor has made poverty a more permanent feature with wide spread

insufficiency of materials for existence. For instance, the low income groups and the

slum dwellers in urban towns and cities are within these categories. In the above cases,

the individual is termed poor. The condition is such that the poor cannot acquire or

possess the usually acceptable amount of money or materials to sustain himself or

herself, the large family and this drags him or her to the border line of starvation or other

criminal strategies to acquire basic needs for existence. TherOefore, the poor are

dependent on the welfare or community leaders who enjoy low traditional and

conventional methods of health care. Such individuals live in traditional substandard

houses made up of mud or day, thatches or straw materials without health services. The

environment of the poor is usually filled with human wastes especially in the rural areas

and located in the out skirts of urban settlements called ghettos. Some people may be

poor because they spent more than their income which result to borrowing; and laziness

but what concerns a spirited individual, is that the poor is one who cannot acquire the

essential basic needs of life and has no stable means of providing or acquiring them.

1.3 Poverty in Nigerian Public Sector

Many people view poverty from different dimensions. Ordinarily, a layman will

view poverty as a situation where an individual could not provide for himself or herself

the basic needs of life such as food, shelter, clothing, simple means of transport and

essentials of good health and also has no access to the means of providing these basic

needs, such as cash inheritance of poverty, assistance from extended family

government and organizations. Others my view poverty as a micro-dimension such as

intellectual poverty, social poverty, political, managerial poverty and so on.

Poverty may be defined as the scarcity of human basic needs or the inability of

an indwidual or the society to acquire human basic needs for existence. It can effect

individual, groups or community of nation. Poverty can also be seen as a science that

seeks, in the sequence of certain phenomena, to trace mutual relations and to identify

cause and effect just as the physical sciences seek to do in order sets of phenomena.

This poverty is interwoven with progress, which is the great enigma of our times. It is

central fact from which spring industrial, social and political difficulties that perplex

Nigeria public sector and the order at large with which statemanship and philanthropy

and education grapple in vain. So as long as all the increased wealth which modern

progress bring goes to build up great fortunes, to increase luxury and sharper the

contrast between the house have and want, progress is not real and cannot be

permanent.

In Nigeria, we were made to know that the Nigerian labour market, with only

about 10 percent of them getting employment. This no doubt, portrays unemployment

as a very serious problem in the country. According to history, unemployment fell very

significantly after the 1987. It fell consistently from 7. 0 percent in 1987 to 3.2 percent in

1991. However, the estimated unemployment gap for Nigeria, indicates that the

unemployment rate varied between 7. 27 and 8. 0 between 1990 and 1998. Many

people who felt disseminated with searching for jobs refused to register thereby leading

to gross under - estimation of the unemployed. Okigbo (1986, 1991) also pointed out

that the concept of labour force adopted in the Nigerian labour force statistical survey,

which excluded people that were less than 15 and above 55 years but actively working,

is an important factors for gross underestimation of unemployment in the country. This

is further compounded by gross inconsistency in government documents. As argued by

Okigbo (1991) it also excludes people who have been categorized as incapable of

working but are willing to work example the handicapped. Also excluded from the labour

force are the full housewives who are willing to be engaged in a paid job. The large

number of unpaid family workers as a proportion of active worker is at climax level in

Nigeria public sector. As a result, many families are in abject poverty.

1.4 Retrenchment in Nigeria Public Sector

It is inconceivable that an administration enunciated employment creation as a

major hallmark of its reform will proceed to offload such a large number of people. The

inability to protect existing jobs shows that this government is merely paying up service b

to the allowed objective of creating seven million jobs needs framework.

Labour also wondered that in the face of this planned retrenchment, this

administration assurance of repackage the reforms in order to make them more citizens

friendly now seem utterly dubious and untenable.

The NLC called on prudent to appreciate that this is not the parting gift for

Nigerian workers and public services. This policy requires a rethink and much broader

contemplation of social and economic cost, as opposed to the pedestrian approach to

cost-benefit analysis, which is unfortunately dominant in presidential economic team. As

Mr. president himself admitted at the presidential retreat on the economy, which he

listed on thus "fighting unemployment is the most fundamental challenge of governance

today, we agree with our president on this imperative but insist that the starting point in

fighting unemployment is to preserve existing jobs as much as possible", the statement

observed.

Meanwhile, the NLC and its affiliates in the public sector would have resolve to

strategies towards engaging the measure, as its National Executive Council meeting will

further deliberate on the matter.

In 21'' century Britain affordable housing should not be just a dream.

Overcrowded housing and homeless rob children of opportunities to succeed.

CHAPTER TWO

CHARACTERISTICS OF POVERTY

2.1 Low Income and Family

When the income per individual is low, the country is below poverty line and that

country is considered poor. Nigeria is poor, because of the standard of living by the

citizens of pegged at N300 a day. This shows that the greater percentage of Nigerians

leave low standard of living beyond the datum of $1 per day. Hence, the degree of

poverty is enormous.

In other hand, a situation where there is a large number of children in a family

and they are working on a low income to which the amount earned cannot meet up with

the basic needs of children. These type of situation can cause or make the children

enter into what they do ndwant like going into prostitution, arm robbery and the rest of

them.

The decision to have many children can be a poverty indicator because large

family size is an attribute of low income per capital population. Large families facilitate ill

health, malnutrition, illiteracy, and high drop out rate as a result of low level education is

such an environment. b

Over-population in a country brings out the output of unavailability of resources.

When family is over sized they will be a lot of competition and criticism in a family

whereby the younger ones will be struggling to survive under such condition to which

lead to death to the weaker vessels because of hungry and starvation.

2.3 Low Level of Productivity

It is generally evident that productivity cannot be effective where there is

shortage of complementary factors like infrastructure, management and efficient

administration. Other cases are the use of primitive implement, high illiteracy rate

among the citizens. Lack of a proper training, low motivation, poor attitude to work and

SO on.

Productivity is an instrument for continuous progress and constant improvement

of activities. Productivity measures the relationship between the quantity and quality of

good and services produced and the quantity of resources needed to produce them.

Productivity is defines as the measure of how resources are being brought together in

organiastions and utilized Low 1-eve1 of Productivity for accomplishing a set of results

which means reaching the highest level of performance with the last expenditure of

resources. Productivity viewed as output per unit of input. Hence, higher productivity

connotes achieving the same volume of output with less factor inputs or more volume of

output with the same amount of factor inputs. Thus, increased productivity could result

from the reduction in the use of resources, reduction in cost, use of better methods or

improvement in factor capabilities; particularly labour.

Finally, given the low technological base of developing countries economics, the

quest or improved managerial capability and effectiveness should give the human factor

appropriate recognition and attension. While labour productivity seems to be the most

convenient to use, it is however, very important to note that this approach has an

important limitation. It treats labour as being homogenous instead of differentiating it

according to age, sex, education, application of skills, attitude, among others.

Nevertheless, this study applies productivity per worker as opposed to per capital or

total factor productivity.

CHAPTER THREE

CAUSES OF POVERN AND RETRENCHMENT

3.1 Family System

The Nigeria cultural system encourages large families, and extended families are

among the causes of poverty. This is because an individual that is not productive with

many wives and children including relatives who produces children that are uneducated

and unemployable thereby increasing the poverty nature of the society. In the same

vein, it can equally effect retrenchment because of large number of people being

employed in a family system, whereby plenty of citizen in different family. cue Rot

3.2 Material Inheritance

It is customarily acceptable in some parts of Nigeria for a mature brother to

inherit a dead brother's wife, children and property when this take place, and the woman

continues to deliver children for the new man there are tendencies of the former children

of the widow to be abandoned without inheriting their father's property. This is a major

poverty indicator in a population that has no special poverty alleviation programme for

widowed children.

3.3 Lack of Pragmatism in National Education

Individuals acquire theoretical education without relevant skills for jobs where

necessary. It is also a situation where a country over produces graduates in a non-

skilled oriented programme and attempts to truncate them into existing jobs where they

have no skills. An example is a graduate in classic education such as philosophy,

mathematics, religion, psychology, English, obtain loan for large scale production in

agriculture and technology similarly, making a graduate of law, medicine, pharmacy,

and engineering to become a director or minister of education where he or she or has

4 no training. And this may resulted to retren@ng of workers through which those that due

recruited into government services through illegal means may be retrenched by new

government in power, thereby bringing about poverty to such persons.

CHAPTER FOUR

POLICY IMPLICATION OF FINDINGS

The analysis presented above established some stylized facts about productivity

and unemployment in Nigeria. It is clearly evident that productivity is low in Nigeria.

Unemployment, on the other hand is very high in Nigeria economic sector. Evidence

from the analysis of productivity and employment linkage shows bi-causal relationships

in all the cases, except in the agricultural sector. The evidence therefore rejects the

neo-classical framework for productwity and employment linkage. The results of the

relationship between productivity and unemployment are mixed. The results show that

bi-causal relationships exist in the industrial sector while and unidirectional relationship

is established at the national level. However, no linkage is established in the

agricultural sector, thereby suggesting that rural unemployment, in most cases, may not

arise from the generalized deterioration in agricultural performance.

The result also show that contrary to the general expectation that an increase in

productivity leads to a reduction in employment, labour productivity is followed by labour

absorption at the current level at both the national level and agricultural sector. The

evidence from the industrial sector supports the general notion, where employers use

less labour to accomplish the same volume of output as productivity rises. Meanwhile

following the accelerator principle, additional labour is absorbed in the next period.

Some policy implication are discernible from the findings. Since more

employment means more income for the poor, which in turn implies a greater demand

for locally produced basic consumption goods, it is imperative for government to ensure

growth and development of the rural and small scale urban sectors. This should

consider, very seriously, encouraging people to establish more labour intensive small

scale enterprises which have the propensity to create more jobs and higher incomes.

This programme, if well implemented, could reverse the rural urban drift which has

seriously affected the urban employment. However in order to achieve this goal, a

complimentary policy of removing factor - price distributions and promoting labour -

intensive technologies of production may be required.

In line with finding from the industrial sector, while acknowledging the benefits of

economic competition, it should however be confined to relative productivity rather than

be allowed to spread into destructive wages and cost cutting exercises while this is a

sacrifice from the part of the private sector, public investment should also be directed

are improving productivity and supporting job creation.

4.1 Solution or Remedy of the Concept

All important as this question is pressing itself from every quarter painfully upon

attention, it has not yet received a solution which accounts for all the facts and points to

any clear and simple remedy. This is shown by the widely varying attempts to account

for the industrial depressions.

The ideas, which bring great masses of men, the expositive of ultimate political

power, under the leadership of tharlatans and demagogues, are fraught with danger, but

they cannot be successfully combated until political economy shall give some answer to

the ,great question which shall be consistent with all her teachings and shall commend

' itself to the perceptions of the great masses of men.

According to the theory of humble approach to development, it is appropriate for

government to ensure our citizen's active participation in formulating projects of which

they are supposed to the beneficiaries. Government should not presume that they know

what will benefit the poor better than the poor themselves. Projects should be embarked

upon the people need, not because some contractors who stand to profit from the

projects are pushing them.

In 1986 Gen Babagida established the director of food, roads and rural

infrastructure (DFRRI) for rural development. This was meant to provide feeder roads,

electricity and potable water and toilet facilities for the rural dwellers. The project gulped

N1.96 (about N80 million today's value) without Nigerian benefiting from them. Various

project were set up for poverty alleviation purposes. Amongst them, are the people

Bank of Nigeria and the community Bank of Nigeria. Neither did these financial

institution lived up to their expectation.

4.2 Political Instability

Our people said that whenever the "elephants are fighting the grasses suffer"

therefore when there is a political - instability in the state, the people go into hardship.

Constant changes in government without democratic system results in serious

political instability most importantly there is striking evidence of unequal distribution of b

the economy and earnings and this gives rise to poverty. A practical example is about

the actions NLC embarking on strike to make the government meet their demands.

These actions claimed a lot of life because of unavailable resources people cannot go

to the market to meet up with their desires as a result of the strike action.

During the tyranny or dictatorship found in Liberia in the regime of Charles Talor,

many people died and suffered because of instability of government. The government

, could no longer meet the demand of the public to which resulted to war. Due to such

situation, poverty and hunger became cousins.

4.3 Conclusion

From all that have been said, it goes without saying that it will take much move

than earnmarking N10 billion for poverty alleviation and retrenchment in Nigeria. There

are many forces that of not checked and put in proper place could seriously derail these

poverty alleviation programmes. There are the environmental forces, economic forces,

political, religious forces and attitude/cultural forces. The state of the Niger Delta

environmental degradation has been well documented and talked about in the country.

These people live-hood depend on crop and fish farming. Their land and water have

been laid waste due to the activities of the oil firms that are in the business of exploring

(oil) and exploiting the area. No amount of poverty alleviation measure will make a dent

in their lifes if they are prevented from doing what they know best, finding. Poverty

alleviation measure is the eradication of the erosion menace and the restoration of their

dignity and their source of livelihood. It is a true that disappointment has follow

disappointments. Discovery upon discovery and invention after invention have neither b

lessened the tool of those who most need respite now brought plenty to the poor. But

failure could be attributed that up to our time the new faith has hardly weakened. We

have better appreciate the difficulties to be overcome, but not the less trusted that the

tendency of the times was to overcome them.

And as such mistake are generally concealed by the respect paid to authority. I

propose in the inquiring to take nothing for granted. I propose to be no question, to

shank from no conclusion that we reach run counter to our prejudices. The economic

increase in the power of producing wealth would make real poverty a thing of the past.

REFERENCE

Diachaube, 0 . (1991); "Productivity and Economic Growth in Nigeria", Productivity for Self-Reliance and Excellence, National Productivity Centre, Lagos.

McCombie and Therlwall (1994) and Hussain and Nado (1997), Dike, Enwere and Ezenwe Uke (1986); "The Dual Economy and Surplus Labour: Reflections on Nigeria" in Unemployment and Underdevelopment in Nigeria, Annual Conference Proceedings of the Nigeria Economic Society, Kaduna, May 13 - 17.

Cordon, D. F. (1976); "A New-Classical Theory of Keynesian Unemployment; The Phillips Cure and Labour Markets Vol. 1, of the Carneqie- Rochester Conferences on Public Policy, a Supplementary Series to the Journal of Monetary Economics".

Simbeye, 1992; Okolie 1995; Roberts and Tybout 1997, Mali 1978:6 Growing up in Oguta : (The Economic of Rural Poverty in Nigeria).

This Articles Cited by Cornelia Dr. Y Ovandgecandy Claycomb. HomelAbout us IAdvertisinglContract Copyright @ 1998 - 2006 Vanguard Media Limited.

Richard Germain (2003) Does Knowledge Mediate the Effect of Control of Performance Some Initial Evidence, Decision Sciences 34:3, 541 - 568.