Budget brouhaha: between incompetence and interests

BUDGETSome of Nigeria’s recurring budget headaches — controversial processes, late presentation, delayed passage and tardy implementation — may have surreptitiously defied and bemused the ‘change’ government’s first outing with a fiscal plan.

The fireworks that greeted the missteps in the outing somewhat gave insight into the workings of the new government, raising concerns over the competence of those in charge and the extent to which personal interests clashed with national development.

The withdrawal of the first version of the budget and alleged discovery of ‘strange’ projects in the second, raised uproar in the National Assembly (NASS), leading to rejection of the document.

Senate Majority Leader, Mohammed Ali Ndume, affirmed that the second budget document failed series of the red chamber’s integrity tests.

However, the National Assembly passed the budget last week after several padded components were discovered and weeded off. But many believe that it is not yet Uhuru for the budget, following omissions overlooked in its passage that may result in further alterations in the course of the fiscal year.

So, who prepared the document and for whose interest, many analysts are wont to ask. Perhaps, the “change” government will provide the answer with time, but obviously not with the budget that has been enmeshed in cesspool of scandal. Maybe, succour might come in 2017.

A World Bank official in Nigeria once said that budget crises persists because many in leadership posts are not aware of what it takes to implement a capital budget, whether it ranged from building roads to bridges or power plants.

Sometimes, projects are injected in the budget without the necessary preparatory work, resulting in low implementation, lax enforcement and monitoring. With this, it is undeniable that getting targeted result is about competence and interests.

Granted, the budget has been passed by the lawmakers of both chambers with few rowdy sessions, without debates over performance level of the previous appropriations and occasional fisticuffs, but it runs on the usual timeline — between March and June. And this may be symptomatic of what is to be expected from the document.

Listing the challenges that defied the first shot at a budget by the new government, the Lead Director of Centre for Social Justice (CSJ), Eze Onyekpere, pointed out that the provisions of the law states that the harmonised 2016 Federal Appropriation Bill is supposed to have been assented to by the President on or before the clock ticks 11.59pm on December 31, 2015.

“Already, we have lost three months and no one is sure whether Mr. President will not have some misgivings to delay the signing and thereby return the Bill to the NASS for further re-touching,” he said.

Meanwhile, there are indications that the document may be subjected to further doctoring, as its passage by the lawmakers bore a tag of inconsistencies.

The Senate President, Bukola Saraki, Deputy Senate President, Ike Ekweremadu and the Chairman of the Appropriation Committee, Danjuma Goje, attested to the challenges of late presentation of the document, noting that there are inherent inconsistencies, as the document moves to the President’s table for assent.

“We saw the earlier hiccups in passing the budget and we hope that by the time we prepare the 2017 budget, the agencies and the budget office would improve their level of interaction and government itself would bring the budget much earlier to give an ample opportunity to the National Assembly to do a good job. It is very important that we do this.

“The 2016 Appropriation Bill contained a number of omissions, particularly in the area of personnel costs. Though the Appropriation Committees has filled some of the gaps, there are many outstanding cases, which could raise serious concern in the course of the year,” Saraki and Goje said.

But Onyekpere said that while passage of the 2016 Federal Budget by the National Assembly (NASS) is commendable, what is available to Nigerians at the moment is the lump sum of the overall budget and its division into sub-heads of expenditure like recurrent non-debt, capital, statutory transfers and debt service, warning that mischief is always in the details of the nation’s budget processes.

But what actually is the substance and variations in the 2016 budget process so far? With the initial proposal of N6.08trn and passage of N6.06trn, approximately 0.3 per cent (N17 billion) of total proposal was cut off.

According to Saraki, there was need to reduce the budget deficit and make it very realistic and implementable. The amount is actually insignificant compared to the total package and the country’s development needs. Besides, there was no reduction to the record debt service bill.

Earlier, government had proposed N1.846trn for capital expenditure that received applauds, about 200 per cent increase from the 2015 record, but now it adjusted to N1.588trn in the midst of budget intrigues. This is N258b reduction, representing 14 per cent decline from the original sum. Suffice to say that the appropriation is an indication that development issues have remained secondary, especially when compared with a paltry N2b reduction (0.002 per cent) in recurrent expenditure’s original sum of N2.648trn.

The debt service bill retained its all-time high of N1.475trn, from N943b in 2015, representing 56.4 per cent increase in the provision.

This was necessitated by the projected debt plans to fund the 2016 budget deficit, as well as those committed by previous administrations.

This year’s budget, like others over the years, has been dogged by controversies, garnering nicknames from different commentators.

Due to the crisis occasioned by the withdrawal of a version of the document, some analysts now describe it as having first and second version; lost and withdrawn versions, or re-modified version.

In fact, after several claims and counterclaims by parties involved at the leadership level, the document came out with changes and was re-presented NASS.

The controversies didn’t end even with the sack of the Director-General of the budget office, who the buck stopped at his table, over alleged inflation of figures, euphemistically known as “padding”. Historically, such criminality is as old as the country, but heightened since the return of democracy in 1999.

As civil society groups continue to allege that wasteful appropriations still abound in the document, the only palpable change in the budget process so far is the sack of the head of the budget office, sustained threat to perpetrators of the crime and relative calmness among the lawmakers in cross checking the line items. The implementation remains for the future.

Noting the country’s notoriety in poor budget implementation, the fiscal governance expert said Nigerians expect the President to immediately assent to the bill and move the executive to expeditiously start the implementation of the budget, which must be done to the letter.

“We are expectant of improvements in livelihoods, infrastructure, social services, employment, economic growth and raising the dignity of Nigerians. The time for apologies is over. There is also the expectation that the Federal Government should expeditiously devise a coherent and strategic framework to guide future budgeting and governance, so that the policy direction and road map can be clear for citizens and the private sector to make rational economic decisions.

“Someone needs to tell Mr. President that he has just two years to govern, not three as he presupposes. The last year will be for politicking and with the effluxion of the first year, just two are remaining and the governance tool—budget— must reflect the change mantra,” Onyekpere added.

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1 Comment
  • emmanuel kalu

    Someone needs to also tell the president to immediately ask all MDA to start preparing the 2017 budget. The numbers can be adjusted once we implement the 2016 budget, however an early start would give rise to more transparency and debate on the budget. implementation is key to budget processes, however it is the job of the lawmaker to ensure every kobo is used for what it was budgeted for. They also need to ensure the standard, the implementation timetable, the allocated amount effectiveness. The use of NGO is a very good process used in developed economy. They are able to do deep and more comprehensive analysis of budget and it implementation. Now every MDA need to publish it capital project, how much was allocated and what the project hopes to do.