How Nigeria’s N53 trillion budget of 18 years failed
The controversy over performance of the 2016 budget is just the latest in a series of government’s failed efforts at infrastructure building in the last 18 years despite ambitious budgets totaling N53 trillion within the period.
The nation’s yearly budget, which started from a modest expenditure plan of N948 billion ($3.2billion) — apart from supplementary requests — in 1999, consistently grew to N6.06 trillion ($19.9 billion) this year. The Federal Government plans to spend more than N7 trillion next year.
Experts have said that the combination of frivolous and fictitious heads and duplication of items in budgets have remained major challenges, leading to poor performance, the huge budget provisions notwithstanding.
Besides, high recurrent votes, which partly was paid out to “carefully crafted ghost worker scheme”, non-implementation of capital votes as planned and abandonment of projects after mobilization, helped to bring the country down.
Out of the N53 trillion, the country has budgeted N33.2 trillion in the last seven years, with recurrent expenditures averaging 72 per cent, leaving 28 per cent for capital votes.
But going by the projections of the stakeholders, an average of N900 billion yearly has been made in the last 17 years, while the recent fall into recession showed that it was not really invested.
An economist and fiscal governance campaigner, Dr. Uzochukwu Anakom, while speaking on the 2017-2019 Medium Term Expenditure Framework, noted that the shoddy work depicts how budgets over the years were used to under-develop the country.
“The macroeconomic targets and figures make no sense to an average Nigerian and can be subject to as many interpretations as there are Nigerians. It commits the government to nothing.
“It raises several questions- what is the inflation target in the next three fiscal years? Will interest be in the single or double digits for it to be consistent with economic growth that can move Nigeria out of recession?Essentially, there are no projections for interest rate and lending to the economy.’’
The immediate past Director-General of Bureau of Public Procurement, Emeka Eze, said that the number of government projects currently abandoned across the country stood at 19,000 as at May this year.
He said that besides duplication of office buildings, personnel and overhead cost, there was the tendency for each agency of government to assert its authority in procurement process.
The result, according to experts, has been poor execution or outright non-execution of projects after mobilisation, as well as over-pricing of projects, after delays in preparation and presentation, inconsistencies in timeframe and questionable figures.
Head of Association of Chartered Certified Accountants of Nigeria, Mrs. Oluwatoyin Ademola, said, “the duplications and ambiguous sub-heads in budgets show lack of transparency and poor processes. It is a pitiable situation for the country, given its place among the nations.
“Truly, if there’s a system and procedures, somebody should see something wrong in this development and somebody must be responsible and held responsible too.”
Labour and the Private sector yesterday described government’s capital expenditure in the last two decades as ‘waste,’ because it failed to lift the country’s physical development beyond the military era. Labour particularly expressed disappointment that Nigerians have continued to get the short end of the stick from their leaders despite ambitious budgets.
Education, Health and general infrastructure have continued to suffer setback, according to the Nigeria Labour Congress (NLC) and there are concerns that the 2017 income and expenditure plan may also fail to build infrastructure and create the needed jobs. It means recession could last longer. “It is a waste of economic resources; budgets have not been productive because it is a way of putting money in the pockets of politicians —the rich grows richer and the poor gets poorer,” Comrade Idowu Adelakan, who chairs the Lagos chapter of the labour union, said.
Secretary-General of the Trade Union Congress (TUC), Musa Lawal, said previous budgets have not been productive due to lack of effective planning by government, which often planned for the short term.
As President Muhammadu Buhari presented the 2017 budget to the National Assembly yesterday, professionals charged the Presidency to ensure that the proposed income and expenditure plan does not suffer setback as the 2016 budget.
Experts, who spoke under the auspices of the Association of Professional Bodies of Nigeria (APBN) in Abuja yesterday, said the lessons learnt from the failure of 2016 budget should be positive reminder government officials to be careful in discharging their responsibilities. This, the body noted, is key to building confidence in the system.
In a statement at the end of its board meeting held in Abuja, President of the Association, Dr. Omede Idris, noted that navigating through the current recession requires genuine concern by all Nigerians.
Speaking on the recent collapse of a church in Uyo, National President of the Association of Medical Laboratory Scientists of Nigeria (AMLSN), Toyosi Raheem, called on the Federal Government to strengthen professional regulatory bodies in Nigeria to enable them perform their duties effectively.
The Federal Government said it had spent over N3.577 trillion out of the full-year N6, 060 trillion budget legislated for the 2016 fiscal year.The amount it also said translates to a 79 per cent implementation or performance level of the prorated budget for the three quarters up to September 30 in the 2016 budget.
According to the Ministry of Budget and National Planning, a total of N1,137.7 trillion has also been paid out in domestic and foreign debt service expenditures during the period captured. The Federal Government also said that in addition to the N2,439.9 trillion so far released for capital, non-debt recurrent and service-wide vote expenditures, a total of N1,137.7 trillion has also been paid out in domestic and foreign debt service expenditures. This includes N44 billion transferred to the Sinking Fund to retire maturing obligations on bonds issued to contractors.
The minister had also explained that although the 2016 Budget was well conceived, with reasonably conservative benchmarks, it recorded unanticipated revenue shortfalls along the line due to militancy in the oil-producing Niger Delta region, a development, which seriously affected projected oil production levels for the fiscal year.
President of the Senate Abubakar Bukola Saraki yesterday said lawmakers would critically review the contents of the revised Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP with a view to producing a very realistic budget for the 2017 fiscal year.
He said the Senate would not rubber-stamp the decisions of the executive arm of government as far as the task of preparing the budget was concerned.And, as part of efforts to get the country out of the current economic recession, the Federal Government yesterday revealed plans to explore new streams of revenues to fund the 2017 budget.