The Effect of Financial Calculations in the Nigerian Economy

It is true that tiny drops of water can make an ocean but time interval at which it drops and its consistency are the keys. No child becomes an adult within the space of one year. It takes several years of growth and development for that dream to become an obvious reality. One is not left in the dark on the effect of financial calculations in the economy except they’ve chosen to be intentionally blind to its truth.

The economy of a nation or a person can be affected in no small way by certain financial calculations like taxes,charges etc both positively and negatively depending on who receives and who gives. A nation involved in international trade have the responsibility of paying certain levies saddled on her shoulder, some of which might be too high and could possibly devalue her currency.

Business owners also owe it to certain government bodies to pay taxes at a fixed rate which might possibly increase with the fleeting of years and takes no consideration of the woes and fortunes of the business owner per time. Though it is a decent source of fund that can be cruel to those it is being sourced from,revenues are being generated when these funds are invested in certain sectors that have been known for wholesale delivery of bountiful returns,which in turn can serve as a means of giving back to the society and people who labour to make policies, enforce and carry it out in different strata of the working sector.

In a nation like Nigeria, housing millions of citizens, a unit naira from all of her citizen can meet the need of a widow who has a dying son needing surgery, how much more few hundreds and thousands of naira. A system can be build such that would sustain the circulation of funds in such a way that the poor are made a little less poorer and the rich,a little less richer thereby introducing a dynamic equilibrium to the system of our economy.

Financial calculations have been known to be one of the ways through which government generate funds. In as much as this strategy is essential, consideration should be taken towards stepping up and stepping down those calculations in such a way that the levied would part with a sum enough for them to bargain with the reality of their immediate environment and also towards standardizing its to vary in a way commensurate to the earnings of the levied. A growing economy is possible if rates increase with dynamic earnings other than increasing with static earnings.

Charges on transactions made with commercial banks have proved to be a threat to funds owned by several government agencies that have employed their services. A recent study revealed that from September 2015, the Federal government has saved a total of N128bn from charges imposed by banks for managing funds belonging to the ministry, departments and agencies of government by adopting the TSA (Treasury Single Account) scheme.

The amount, according to investigation, represents the various charges and account maintenance fees,which were heretofore charged by the Deposit Money Banks for holding government funds. Prior to the commencement of TSA (Treasury Single Account) scheme, the government was incurring about N4bn monthly to maintain its various accounts in banks whereas it could have been been used to meet the immediate economic needs of the nation. This situation outrightly explains how the nation loose more trying to save more and thereby introducing a gradual decline in the state of the nation’s economy as funds are indirectly channeled towards non-profit making projects as this.

The recently introduced scheme of TSA has saved government large sums that would have gone on commercial bank charges. The initiative, which commenced fully in September 2015,has been complied with by over 900 agencies of government with 20,000 bank accounts closed. In the detailed calculations of the tonne of savings this scheme has delivered to the government from September 2015 to April 2018,a total of 32 months of 4bn charge per month equals N128bn.

It is obvious that financial calculations have a way of affecting the economy entirely. In spite of the advantages it promises,its cruel disadvantages can be managed by adopting a system that can check its excesses as it cannot be ruled out out-rightly.