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Opinion / Editorial

President Buhari, Honour Your 2016 Budget Pledges

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By Jide Ojo

A week ago, on March 23, 2016, the National Assembly, after several postponements, passed the 2016 appropriation bill presented to it by President Muhammadu Buhari on December 22, 2015.  The budget, the first by the All Progressives Congress-led Federal Government had suffered some bashing from civil society organisations, the media and opposition political parties. At some point, the Presidency itself admitted that the budget was doctored and had to be tactically withdrawn and resubmitted. Even at that, the specter of irreconcilable figures and errors in the budget did not go away as many ministers and heads of government parastatals denied some of the figures in their MDAs budget during the defence sessions with the National Assembly. Indeed, many heads had rolled in the Budget Office for national embarrassment as some of the officials responsible for the budget draft had either been transferred or sacked.

Now, after much supposed cleansing, the National Assembly passed a N6.06tn budget as against the N6.08tn estimate presented to it by Buhari last December. For the first time since 1999, there was a reduction in the version passed by the parliament vis-à-vis the estimate from the executive. Hitherto, the National Assembly had been in the habit of jerking up the budget estimates. Well, as it is, perhaps due to public outcry and a shortfall in expected revenue, the lawmakers had reduced the budget by N17bn.

According to news reports, the breakdown of the budget is N1.59tn for capital expenditure, N2.65tn for recurrent expenditure, N1.48tn for debt servicing, N2.2tn as deficit, N500bn for social intervention and N351.4bn for statutory transfer. The lawmakers reportedly left the oil price benchmark at $38 per barrel with average production of 2.2 million barrels of crude daily, an exchange rate of N197 to $1, and a GDP growth rate of 2.14 per cent.

It is noteworthy that the 2016 budget, aside from being doctored was hastily put together and submitted late to the parliament. Why? President Buhari’s cabinet was inaugurated on November 11, 2015 and the new ministers had yet to fully grasp the nitty-gritty of budget planning as of the time they had to submit their financial estimates to the Budget Office for collation. Ordinarily, going by the provisions of the Fiscal Responsibility Act 2007, the budget estimate is supposed to be preceded by the passage of the Medium Term Expenditure Framework and Fiscal Strategy Paper. At least, the MTEF and FSP were supposed to have been sent to the National Assembly latest four months to the end of the financial year. Nigeria’s financial year runs from January 1 – December 31. Thus, the two are supposed to be before the parliament for consideration latest by September while the budget is expected to be laid before the legislature latest by October. Unfortunately, ours is a warped system. More often than not, budgets are submitted to parliament in December.

In December 2016, the MTEF, FSP and 2016 budget had to be rushed through the National Assembly. Successive governments had consistently done the same by relying on Section 81 (1) of the 1999 Constitution, as amended, which says, “The President shall cause to be prepared and laid before each House of the National Assembly at any time in each financial year estimates of the revenues and expenditure of the Federation for the next following financial year.”

The other defence past administrations had relied on is Section 82 of the Nigerian Constitution which stipulates that: “If the Appropriation Bill in respect of any financial year has not been passed into law by the beginning of the financial year, the President may authorise the withdrawal of moneys from the Consolidated Revenue Fund of the Federation for the purpose of meeting expenditure necessary to carry on the services of the Government of the Federation for a period not exceeding six months or until the coming into operation of the Appropriation Act, whichever is the earlier.”

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It is a known fact in law that the constitution of a country is the grundnorm (the supreme law) and any other subsidiary legislation is ultra vires, null and void to the extent of its inconsistency with it. However, truth be told, it is in Nigeria’s best interest to obey the provisions of the Fiscal Responsibility Act. A nation’s budget is a signpost for the economic forecast of that country and foreign and local investors use it as a barometer to plan for their intervention. Consistently relying on sections 81 (1) and 82 of Nigerian constitution has caused a lot of dislocation to the country’s economy.

As it is, Quarter 1 of 2016 financial year ends on Thursday, March 31. I am not sure there has been any capital release yet for the year. As things stand, much as the budget might have been passed on March 23, there are still few hurdles to cross. The detailed budget has not been made available to the President as of Monday, March 28, perhaps due to the Easter holiday. A media report has also said that following the passage of the 2016 Appropriation Bill by the National Assembly, PMB has ordered all the MDAs to thoroughly review the budget before it is sent to him for assent. The anonymous source allegedly said the President gave the directive just before the Easter break in order to ascertain if any significant amendments were made by the legislature that are inconsistent with the spending plan of the executive arm of government. What this means is that the budget may not be signed until sometime in the second quarter of FY2016. This definitely will hamper proper implementation.

Honestly, the major challenge with Nigeria’s budget has been that of execution. It has always been a tug-of-war and war of words between the executive and legislature on budget performance. The only aspect of the budget that is often fully implemented is the recurrent expenditure. As for capital vote, they are usually not adequately cash-backed. Or better still; the capital release is always at variance with capital vote as, more often than not, it falls short.

I need to remind President Buhari that many Nigerians who voted for him last year are disenchanted with his administration’s performance in office thus far.  Am using this opportunity to remind Mr. President of his promises in the 2016 Appropriation Bill. These are: FG plan to partner with State and Local Governments to recruit, train and deploy 500,000 unemployed graduates and NCE holders;  the FG plan to partner with State and Local Governments to provide financial training and loans to market women, traders and artisans, through their cooperative societies;  working  through the office of the Vice President with various development partners to design an implementable and transparent conditional cash transfer programme for the poorest and most vulnerable. This includes homegrown public primary school feeding and free education for science, technology and education students in Nigeria’s tertiary institutions. (See paragraphs 23 – 25 of the President’s budget speech to the National Assembly). The President will do well not to renege on these pledges. In case he does not know, his party’s name has been rebranded to mean “All Promises Cancelled”.

As we gradually come to the end of the ruckus over the 2016 budget, it behoves the National Assembly to do the needful over the budget by providing essential oversight services. Similarly, the CSOs working on budget and public finance as well as the media should network to ensure that they follow the money and make our money work for us.

Follow me on twitter @jideojong


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