Cost of living: Let’s start the clock

A friend’s wife recently made frantic phone calls to her husband. I was with the husband as the calls came in torrents until he eventually picked up. It turned out to be something of a save-our-soul call.

According to her husband, she was calling from a neighbourhood market where she had gone with N20,000 to pick up a few household items. She bought pepper, vegetable oil, a few eggs and some other essentials. Before long, the money was gone.

While that was playing out, another Nigerian somewhere was filling the petrol tank of his car with an amount equivalent to the national minimum wage. A tenant had just been handed his landlord’s love note announcing a rent increase and demanding payment.

In the midst of all this came the good news. The government says things should begin to get better within 90 days.

So, what exactly should my friend’s wife, the car owner or the tenant expect to be different after 90 days?

The National Economic Council last week endorsed a 90-day economic action plan intended to ease the cost of living and deliver more tangible benefits from ongoing economic reforms. The plan reportedly concentrates on five areas: food affordability, tax harmonisation, completion of high-impact projects, removal of investment bottlenecks and household support.

The Federal Government says the objective is to translate economic reforms into improvements citizens can actually feel. That, in itself, is instructive. It amounts to an acknowledgement that macroeconomic improvement must ultimately translate into improvement at the household level.

Why has the government chosen 90 days? What can realistically change in three months? Of course, big projects such as a refinery or railway cannot be built and completed from scratch in 90 days. But some things can change. Food-distribution bottlenecks can be addressed, taxes and levies can be streamlined, while targeted support can reach households. Since the government selected the deadline itself, Nigerians are entitled to hold it to that deadline.

There will definitely be scepticism. Nigerians are not new to promises of a better life presented in different catchy phrases. They are no longer interested merely in hearing that the economy is improving. They want to experience the improvement.

Before the 90-day clock runs down, it is important for citizens to establish what life costs today. How much do basic foodstuffs cost now? How much does it cost to refill a cylinder of cooking gas? What are the current prices of petrol and diesel? How much are commuters paying on selected routes?

There is no meaningful way to measure improvement after 90 days unless a baseline is established now. The government should publish its own baseline, while citizens should also take note of what they are currently paying.

The government should also define success. For instance, what does it mean by “easing the cost of living”?

Does that mean a fall in food inflation, an actual drop in food prices or a decline in transport fares?

Are more jobs going to be created? Will disposable income rise?

Without measurable targets, almost any outcome can later be declared a success. Citizens should therefore demand specific benchmarks.

For me, food must be the biggest test. For most Nigerians, the cost of living begins with food. The government cannot claim victory if statistics improve while families are skipping meals.

Nigeria has vast agricultural land and millions of farmers, yet moving food from farms to consumers can be expensive. Tomatoes harvested relatively cheaply can become expensive by the time they reach Lagos, Abuja or Port Harcourt because of transportation costs, fuel prices, poor roads, multiple levies, spoilage, insecurity and the layers of middlemen involved.

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If the 90-day plan genuinely seeks to make food more affordable, it should examine the entire journey from the farm gate to the dining table.

There is also an urgent need for tax harmonisation. Businesses complain about multiple taxes, levies and charges imposed by different levels and agencies of government. These costs, in turn, affect prices. Transporters, traders and small businesses face different levies, while manufacturers also contend with taxes and regulatory charges. Ultimately, many of these costs are passed on to consumers.

If the government genuinely harmonises taxes and eliminates unnecessary duplication, Nigerians should eventually see the effect in business costs and prices.

One of the plan’s priorities is household support. There is a need for proper disclosure here. What kind of support should Nigerians expect? Will it come in the form of cash transfers, food, transport subsidies, credit or some form of social protection? How will beneficiaries be selected?

Nigeria has previously faced controversies over social registers and the distribution of palliatives, so transparency is essential.

There is nothing inherently wrong with temporary support during hardship, but bags of rice cannot substitute for an economy in which people earn enough to buy their own rice. In the same way, cash transfers cannot permanently replace productive employment.

The 90-day plan must therefore have two layers: immediate relief and structural reform. While relief helps people survive today, reform should make them less dependent on relief tomorrow.

Electricity cannot be ignored in the scheme of things. Businesses depend on electricity to produce goods and provide services. When grid supply is inadequate, businesses turn to generators and alternative sources of power, adding to production costs that are ultimately passed on to consumers. The government cannot meaningfully address the cost of living while treating power as a separate conversation.

States must be held accountable too. This is a National Economic Council plan, and the council includes the governors. It should therefore not be reduced to “Tinubu’s 90-day plan.”

Many things affecting daily life, including markets, local roads, multiple levies, transport systems and aspects of agricultural development, fall within state and local responsibilities. With state governments now receiving substantially higher revenues, what is each governor’s 90-day contribution to reducing the cost of living?

It is also important to ensure the goalposts aren’t moved after 90 days. The government shouldn’t reach the end of the period and suddenly say the reforms require another six months. Officials should define expectations now, not after seeing the results. If circumstances change, they can explain them without retrospectively rewriting the objectives.

It is true that economic problems accumulated over many years won’t disappear in three months. Nigeria’s cost-of-living crisis is influenced by global commodity prices, exchange rates, domestic production, insecurity, energy costs and international developments. The fair test, therefore, is not whether everything becomes cheap in 90 days. It is whether Nigerians will be able to identify measurable movement in the right direction.

In 90 days, government officials may return with charts showing inflation, investment, revenue and other economic indicators. Those figures will matter. But there will be another, perhaps more important, test.

The Nigerian who walks into the market with N20,000 today should be able to tell us whether that same N20,000 can buy more, less or roughly the same when the 90 days expire.

The government has chosen the deadline. It has identified the problems. It has announced the plan. Nigerians should therefore do something very simple: start the clock and keep the receipts.

Ninety days from now, Nigerians should not need the government to tell them whether life has become easier. They should be able to feel it.