…Inflation, capital flow top agenda as MPC meets***
The Academic Staff Union of Universities (ASUU) has insisted that until certain conditions are met by the Federal Government, its members will not return to work.
A key condition, according to the striking lecturers, is that government must show concrete evidence of the payment of at least N50 billion revitalisation fund.
Another condition attached to the suspension of the strike is “the presentation of concrete evidences of the payment of the promised N20 billion earned academic allowances and showing how the balance of N85 billion will be paid with timelines”.
ASUU President Prof Biodun Ogunyemi spoke with reporters in Ibadan, Oyo State ahead of today’s meeting between the union and government’s team.
Ogunyemi added that the union’s members have said that only concrete implementation of conditions by the government would make them return to the classrooms.
The union also said it has lost confidence in government making promises, which it would not keep to after agreements have been reached.
ASUU, according to Ogunyemi, has rejected government’s proposal of N20 billion (to be paid in two tranches) for the revitalisation of universities.
The union is asking government to mainstream the earned academic allowances into the 2019 budget, which is still being worked on by the National Assembly.
He lamented that the ruling class did not see education as a priority but prefer to create new education colonies of private educational institutions, which, according to him, cannot meet the needs of Nigerian children.
Ogunyemi said: “We want them to pay immediately N50 billion as a sign of commitment this quarter and for the next three quarters government can pay N50 billion in each quarter.
“Some of our members have rejected the N20 billion proposed by them that will be spread over two quarters in 2019. Our members have insisted on the release of at least N50 billion.
“In relation to earned academic allowances, which they have an outstanding N105 billion, our members are saying that even if you (government) are releasing N20 billion, let it be stated clearly that it is only for ASUU members and the balance, which you promised to pay in four instalments, attach timelines to the balance and figures.
“In 2017, this government promised to mainstream the earned academic allowances into the budget so that we won’t be coming to talk about arrears. If government had put that into the 2018 budget, we would not be talking about arrears now.
“Our members are saying government should take steps to mainstream it into the 2019 budget and that is not late because they (National Assembly and executive) are still working on the budget.”
In the meantime, members of the Central Bank of Nigeria (CBN)-led Monetary Policy Committee (MPC) will today converge on Abuja for a two-day meeting.
They are expected to take measures for more foreign capital inflow and curtail capital flow reversals and rising inflation ahead of the elections next month.
The consumer price index, which measures inflation, rose to 11.44 per cent last December, the National Bureau of Statistics said. The increase, the bureau said, is 0.16 per cent points higher than the rate recorded in November 2018 and is expected to trend northwards as ahead of the elections.
The 265th meeting of the MPC and the first for the year, is expected to keep all policy rates unchanged as with all meetings since July 2016. That decision will prevail despite rising calls from economic experts for the committee to lower benchmark interest rate.
Expectedly, the MPC will retain the Monetary Policy Rate (MPR) – benchmark interest rate at 14 per cent; Cash Reserve Ratio (CRR) at 22.5 per cent and Liquidity Ratio (LR) at 30 per cent as well as the retention of the Asymmetric corridor at +200 and -500 basis points around the MPR.
Speaking on the development, Managing Director, Afrinvest West Africa Limited, Ike Chioke, said the committee will maintain status quo on all policy rates. He said the committee will not want to tamper with the policy rates at this period of electioneering.
He said: “I do not see the MPC members making any policy adjustment at this period. The elections will be held next month and this is not the time to make any changes,” he said during the presentation of the company’s 2019 economic outlook in Lagos at the weekend.
According to other analysts at the investment and research firm, developments in the global economy and financial markets are likely to be viewed with mixed feelings by the MPC.
“Higher commodity prices are boons to Nigeria’s external sector stability and fiscal balance, but it also comes with attendant risk of ballooning state’s petrol subsidy. On a balance of risks, we believe that external sector developments remain broadly favorable for Nigeria, supportive for economic growth and current monetary policy stance. Yet, the MPC will likely maintain its cautious view due to emerging downside risk of capital flow reversals,” they said.
At their last meeting, the MPC members assessed the macroeconomic environment in 2018 and noted the modest stability thus far achieved in domestic prices, output growth and the financial system.
The committee noted that the economy was on the right path but some key sectors continued to experience significant challenges.
The MPC, however, expressed concern about the tepid growth expectations and growing uncertainty in the global financial markets arising from the poor reception of the Brexit deal by British politicians, continuing trade war between the US and her major trading partners, as well as the commencement of U.S. sanctions on Iran.
The committee believed that although the domestic economy was recovering modestly from recession, however, the recovery was tepid and efforts should be stepped up to strengthen aggregate output and demand.