Why Nigeria is stuck in underdevelopment – Part 2

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The second issue pertaining to the crass underdevelopment quagmire of Nigeria has to do with budgeting and the way and manner funds are released for budget implementation. To start with, budgeting in Nigeria is fraught with rancor and acrimony that more or less shows the day. There are no standard rules that are strictly followed in Nigeria’s budgeting practice. There is no target date for presenting budget. The date the budget is presented on yearly basis depends on the prevailing political shenanigans at the time.

After the budget presentation, there is battle at the National Assembly over what should be included and what should not. The battle may rage for months while governance stagnates. Quite often, the lawmakers are more interested on what they stand to gain from the budget. Whenever the battle ends is when governance restarts. Even at that, problems still abound.

There are two sides to this problem. The billions/trillions presented annually as budget practically make no impact because more than 70 per cent is spent on servicing civil servants’ salaries and emoluments in what is otherwise called recurrent expenditure. The remaining 30 per cent that meant for development hardly sees the light of the day. The budget comes to naught because of the fractured and late release of funds. Out of the 30 per cent earmarked for development, maybe, at the end of the day, only about 15 per cent is actually released. By this, Nigerians should appreciate the fact that budgeting is one thing while the actual release of funds is totally a different thing. What Nigerians hear every year is what is budgeted and not what is actually released. Nothing is said about what is frittered away.

The fraudulent release of budget funds without target worsens the matter. I have said earlier that ideally, no fund should be released without actual and verifiable project or activity for which the money is meant. This is so because there is a difference between what a budget proposes to do and what it actually achieves. What a budget proposes is meaningless except it actually carries it out.

For example, if the Ministry of Works proposes to rehabilitate the deadly Benin-Ore-Shagamu highway but at the end nothing is done, that budget is meaningless. To ensure that the work is actually done, funds should only be released based on concrete action on a project. If this is followed, there will be no room for ‘unspent’ budget, which simply represents funds that were falsely obtained from government without intent of applying it to any project. It is tantamount to swindling the government.

In a corrupt country like Nigeria, it would be foolhardy to expect that funds released to government officials without strict monitoring would be applied accordingly. Even when funds are released based on specific projects or activity, there should be monitoring to ensure that the monies are applied as stated. If for any reason the fund was not utilised, it should be returned to the treasury. And it doesn’t end there. There should be a query to the officer concerned to explain why he or she failed to utilise released funds to execute a particular project. Talking of not executing a project and at the same time not returning the money amounts to double jeopardy. The officer should be sanctioned. Unfortunately, we’re in a system where these things are happening daily and overlooked without questioning. Nobody is queried, sanctioned or prosecuted for such corrupt practices, which is the order of the day.

The other issue concerns mobilisation fee. Since the military introduced mobilisation fee into contractual agreements in the country, the system has been duped of billions. Ideally, a contractor seeking contract is supposed to have the financial muscle to mobilise for work if awarded the contract. But the reverse is the case in Nigeria. Contractors, most of the time, fronting for government officials, are awarded contracts and thereafter paid huge mobilisation fees with which they abscond. The project is abandoned. That is why there are thousands of abandoned projects across the country. There is a chain of corruption in all this, which explains why no one asks questions. No contractor has been prosecuted for failing to do a job. The best we hear is that the contract has been terminated but nothing is heard of the mobilisation fees paid the contractor.

It is possible to break the chain of corruption if somebody, somewhere, acting as president, minister, governor or local council chairman, puts his or her feet down and says enough is enough. Up till now, that has not happened. That is why we have recorded little progress. For budgets to work there should be strict monitoring of the released funds. There should also be appraisal to ascertain the level of performance. That would give insight into the hitches encountered, which should then be blocked in subsequent budgets.

The way to deal with the population data issue is simple. Carrying out a reliable headcount remains the most ideal way to obtain accurate population figure. That Nigeria is operating with cooked population figures is widely known. The question is what is the government doing about it? Government has what it takes to conduct a reliable headcount in Nigeria. Mere lamentation would not solve the problem. What is government’s plan in this regard? The planned 2016 national census did not hold for obvious reasons of lack of adequate preparation. And even if the preparations were made, how about the politicians? Are they ready to let the right thing to be done? Is the vague template used to allocate population figures to different regions going to be done away with? If it is established through proper headcount that the North is not more populated than the south, will the North accept that?

Nigeria is stuck in underdevelopment quagmire. Pulling it out is, perhaps, the most difficult thing to do. This is the fact about this country. Right thinking Nigerians know this and sometimes proffer unheeded solutions. The authorities know this but are helpless. The leadership is afraid to do the right thing. Lack of political will and parochial mindset hold the polity by the jugular. Promoting ethnic interest is a huge burden entrenched in the polity and almost impossible to uproot. The country is going nowhere so long as the fundamental ills plaguing it are left unresolved.

Concluded.



1 Comment
  • real

    smashing article and directly reflect Nigeria problem. however I would add that this problem would continue because Nigeria has not found the right leader to solve the problem. The solution is simple, it is the implementation and leadership that Nigeria lacks. we have the system in place to solve our population count, yet the leaders that are criminals would not allow this to happen. BVN is being used accurately right now, even though the implementation was ineffective. However that is something we can build on and use to accurately get a proper census figure. There is no reason why every single Nigerian, home and abroad should not obtain a BVN, whether it is tied to a bank account or not. each Nigerian should have one. That BVN would act as a national ID number that would be tied to only one person in Nigeria. That number can also be used to tie other activities to that specific person, banking, electricity, education, taxes, business, loan etc.
    in terms of mobilization fund for project. That should be completely and totally ended. if you don’t have the financial capacity to execute a project without mobilization funds, then you should not be awarded the contract. in most developed country, if you bid for government contract, you are also required to show your ability to fund the project to a certain level before you are paid a certain amount. that means if you are building a road, you fund the road construction up till 25% and the government pays you 25%. you would paid percentage completion of project. if this means that no Nigeria company would be able to do government projects, then we can really being to understand the problem. However that problem can be solve by encouraging the banks to lend to contract winner to fund the project.

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