ONADEKO: We Need Deadline For Budget Submission, Passage
Aderonke Onadeko is a player in oil and gas operations. She told BISI ALABI WILLIAMS that delayed budgets do not allow economic players to plan and move fast enough for the year.
On Delayed Budget
IT is unfortunate that Nigeria is tardy with a foundational activity such as, the submission and passage of the 2016 budget, considering the time it takes for ancillary activities like the defense of budget proposals by ministries, departments and agencies.
It is obvious that the passage will be late, as has been in past years, and this, in turn, will leave the economic players in Nigeria unable to plan and move forward with much needed activity in the new year. A deadline for submission and passage of the appropriation bill should be instituted and adhered to going forward.
Just as mentioned above, my desire will be for the legislature to pass a bill in the near future and set up a yearly calendar stipulating a time frame for all activities relating to the preparation, submission as well as deadline for approval of the Medium Term Expenditure Framework (MTEF).
Funding The 2016 Budget
If the government tackles the Petroleum Industry Bill as a matter of urgency, there might be a window to extract some income from a credible and transparent licensing bid round for both oil prospecting and even mining licenses.
Generated income from sale of crude oil, which otherwise would be stolen, lost to illegal bunkering and refining could be recaptured. The sale of our crude eliminating middle men and inefficiencies can improve our income generation, elimination of oil theft, blocking manipulations and diversion of government inflows into its accounts and deliberate theft of oil receivables could also improve the governments generated income towards its 2016 spend.
Lastly, repatriation of funds is likely one of their expected sources, however, this is not likely to materialise in the short term and investigations and legal recourse before repatriation could take a considerable amount of time. External sources to bridge the spending fund gap include, development aid agencies and leveraging on foreign reserves and Foreign Direct Investments. We also have to plug gaps of corruption, slow down on subsidy spending; excise and luxury taxes should be monitored closely and regulators held accountable for collection.
The budget for 2016 is late; the US gave its final approval for its 2016 budget at the end of October. We should work with international best practice and emulate other thriving democracies and benchmark ourselves to their schedules and calendars. The legislature should impose a time limit on presentation of the appropriation bill, giving enough time for the necessary ministries and parastatals to defend their budgets etc.
On Budget 2015
The non performance of the 2015 has not gone unnoticed, it is important to understand why this was so, as well as making sure the funds unutilised are returned to the government coffers, as opposed to the business as usual way, whereby in the last days of the year all ministries deplete their accounts in order to prove their efficiency of use of their last budget. Annual budgets don’t have to be incremental, ministries that cannot show efficient use in previous years should be penalised and their budgets reduced to match their capabilities.
Gaining Speed For time Lost
Nigeria is at the verge of a recession; our growth has slowed down and productivity also, many manufacturers and employers of labour have had a tough financial year, reducing consumer spending, coupled with the decline in spending by the government caused by the non performance of the 2015 budget and crude price crash has hurt Nigeria and her economy.
Government should realistically start spending immediately we move into 2016, especially in area of non- consumption. Construction, development of infrastructure (road and rail transportation) and powering the nation should take priority.
Spending on fuel subsidy, paying stipends to the unemployed youths and feeding school children, though laudable and populist, should be reviewed in view of the financial realities of the day and sustainability. The government should respond to our economic capability and come to terms with same, most of the promises made during campaign in 2014/15 are looking unrealistic now they have taken over government or better still, they should adopt a reduction to the barest minimum of their promises to conserve funds for activity that will spur development, create employment and empower citizens in a sustainable and lasting fashion. Education (developing teaching capacity), health care, especially, for the vulnerable, agriculture and agribusiness, infrastructure development and power should feature in the top five spends of the government in 2016.