Sanusi has raised a very importa

PeeCeeYay By Jideofor Adibe Sanusi Has Raised a Very Important Question But…

Whenever Lamido Sanusi Lamido says anything, be it an ordinary ‘good morning’, then it has to be like Sanusi Lamido Sanusi – dramatic, colourful, controversial and ‘roforofo’. The most controversial Central Bank Governor in the country’s history is very adept in raising very critical questions but not always successful in providing the right answers. And it is not because he is not brilliant. He is exceptionally one.

In late November 2012, at the Second Annual Capital Market Committee Retreat in Warri, Delta State, Sanusi lamented the high cost of servicing the nation’s civil service and called on the Federal Government to fire at least 50 per cent of its entire workforce, arguing that it is unsustainable for the country to continue to spend some 70 per cent of its earnings on salaries and entitlements of civil servants. Understandably labour leaders and many others lampooned him, with some even calling for his sack. The Nigeria Labour Congress specifically said Sanusi must be sacked before he destroyed the Nigerian economy. I will return to this later.

Why has controversy dogged Mallam Sanusi ever since he became the CBN Governor? Does he court it? Or does it run after him?

Sanusi’s ‘problem’ in my opinion stems from two sources: The first is that I feel he is a radical in a job that is decidedly conservative in nature. The second is his fascination with the English Language, which he writes with remarkable authority and even speaks better. On the positive side this could make one appear cleverer than one really is. On the flip side, too much ‘grammar’ (turenci) could lead to an undue love for the podium and limelight and a fascination with the echo and musicality of one’s words - with the attendant risks of gaffes in moments of rhetorical flourishes. I do not for a moment believe the crap that Sanusi is driven by any hidden agenda. But this is a different thing altogether.

At an event in London in 2009 to talk about the reforms in the banking sector, I asked Sanusi, if professionally speaking, he saw a tension between where he found himself, and where in his heart he felt he ought to be. Sanusi denied being a radical but admitted that when he was in merchant banking, he did feel that tension. I have read a few of Sanusi’s writings on Gamji.com and never ceased to admire his brilliance. I always felt his ‘natural’ calling would be as a radical academic – in the mould of the late Bala Usman or as the life Chairman of a brief case political party that will provide him a platform for slinging shots at the establishment – as the likes of Femi Falana and Balarabe Musa do.

Despite Sanusi’s protestations, I am inclined to see him as a ‘radical’ or ‘revolutionist’ – in the sense of someone who favours extreme or fundamental changes in the way the society is organised. Remarkably, while I regard Sanusi as a radical in criticisms of the system, as a banker, I see him as a conservative, a traditional regulator who is excessively concerned with risk management at a time Nigerian banks seem to have become more competitive and entrepreneurial. There is therefore in my opinion a tension between Sanusi the banker and Sanusi the system critic.

As with most system critics or revolutionists, Sanusi’s approaches to complex issues tend to be simplistic and as the contradictions in his chosen options become obvious, the proffered solutions tend to appear contradictory or hastily taken. A clear case in point was his recommendation that the bank executives he sacked for fiddling with depositors’ money who were then standing trial at various courts in the country deserved to die by firing squad for eroding public confidence and raping the institutions that were entrusted to their care through reckless credit and loan administration processes. Sanusi was later to recant, perhaps after he realised the enormity of the statement, saying that Nigerian bankers are honest, hardworking professionals and not the crooks he had made them to appear.

There have been several of such apparently hastily thought-out recommendations from the Mallam Sanusi, including the recent issue of N5000 bill. The typical mind-frame of a revolutionist is: we reject the institutions that govern us, let’s pull them down and erect brand new ones that will serve us better. This dictum is fine on a philosophical plane but creates enormous challenges at the level of implementation. This is another way of saying that it is OK for such recommendations to come from theorists and social critics but not from policy-makers. The problem on the ground is that if you pull down your house because you want to erect a brand new one that will be more befitting, you risk making yourself homeless while the new building is being put up with the attendant dangers from the elements - unless you have made alternative arrangements. The less radically inclined will embark on an incremental renovation of the same house, moving their belongings from one part of the house to the other as the work progresses.

It is within the above premise that we should try to locate Sanusi’s recent recommendation about sacking 50 per cent of the civil servants to save cost.

On face value, Sanusi is right because there is no doubt that the public service, in particular the civil service is bloated. Just visit any PHCN office and you will see several of their staff loitering outside their buildings like touts – largely because there seems not enough for them to do, which also explains why ten staff should visit one household to do ‘metre reading’. But Sanusi was wrong that firing 50 percent of the civil servants will lead to cost saving. It will not. Rather it will actually increase the cost of governance. There are three options here: The first is t reduce the staff strength without trying to professionalize the service. Under this scenario, there will be an increase in red-tape and corruption within the service as the fewer staff will increase their asking price to move your file from table A to table B. Here the civil service will end up being even more inefficient than it is now, leading probably to an increased use of outside consultants to get things done. The second option is to completely professionalize the civil service. This will include re-organising the recruitment modes of staff such that the service can attract the best talents available. But this also means paying competitive salaries and other emoluments commensurate with what they would get in private international firms in the country. This scenario means that having a 50 percent reduction in the size of the civil service will not necessarily mean a reduction in its wage bill. The third option is to do nothing – which shouldn’t really be an option at all.

The service Sanusi has done for the country by his recent call for the firing of 50 percent of civil servants is to indirectly draw attention to the need to reform our civil service while boldly re-igniting the debate about the huge cost of governance in the country.

Let me return to my earlier assertion that Sanusi is a radical system critic in a job that is decidedly for conservatives and pro-establishment people.

Central Bank Governors are thought to possess so much crucial information about their country’s economy that investors and analysts closely monitor their utterances even after they have left office. For instance when Alan Greenspan, who retired as chairman of the US Federal Reserve on January 31, 2006, predicted on February 26, 2007 that the US would enter into recession before or in early 2008, the Dow Jones Industrial Average dropped by 416 points (or 3.3 percent of its value) the following day. At that time, it was the worst one-day loss since September 17, 2001, when it lost 684 points (7.1 percent) after reopening in the wake of the 9/11 terrorist attacks.

It is perhaps because of the ‘oracular’ nature of being the boss of a country’s central bank that many expect them to be rather taciturn. Willem "Wim" Frederik Duisenberg, first president of the European Central Bank (1998-2003) was noted for his bluntness and apparent inability to keep his mouth shut. In a special report on February 8, 2002, captioned, “The Wrong Man for an Impossible Mission”, the Financial Times (London) summed up the angst against the late Dutch economist and financier: “The biggest criticism of Mr Duisenberg is not over the substance of his decisions, but over his presentation. His willingness to talk off the cuff and his often vivid turn of phrase has frequently raised eyebrows among other policy-makers.” No, the Financial Times did not have Lamido Sanusi in mind, who is eminently intellectually qualified to be the CBN Governor, when it wrote that piece. But one sometimes wonders if he deliberately courts controversy by his choice of words – as system critics are wont to do.