Lawmakers pick holes in 2018 Budget

The debate on the general principle of Budget 2018 estimates presented by President Muhammadu Buhari on November 7 began yesterday at the National Aseembly.

It was met with apathy at the House of Representatives and condemnation by Peoples Democratic Party (PDP) senators.

At the House, only 10 lawmakers indicated interest to speak on the budget, although the House will go on plenary break from tomorrow to enable members carry out oversight functions and the commencement of budget defence by Ministries Departments and Agencies (MDA’s).

As it is customary, lawmakers were asked last week to register their names against the days they wished to contribute to the debate but there appeared to be no urgency as the list for day one was exhausted in less than one and half hours of debate.

With a point of order, Kingsley Chinda (PDP, Rivers) said the consideration of the bill would be a breach of the Fiscal Responsibility Act (FRA) that stipulates the passage of the Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) before the consideration of the budget document.

Before an argument could ensue, the Presiding officer, Deputy Speaker Yussuff Lasun, pleaded that the leadership was not unaware of the law but the debate should be allowed to begin.

Lasun ruled Chinda out of order and asked House Leader Femi Gbajabiamila to lead the debate.

Gbajabiamila, said the 2018 budget was appropriately tagged “Budget of Recovery” and explained that it was anchored on zero-based budgeting system to get the country out of recession in quick time.

He said all the key assumptions in the budget were realistic, and urged his colleagues to be non-partisans with greater consideration for the national interest.

”We must look at the bigger picture. We should look at what the budget is trying to achieve through diversification of the economy, infrastructural development and job creation, among others,” he noted.

Gbajabiamila advised his colleagues not lose sight of the positives of the 2018 budget, adding that the lawmakers had a responsibility of passing the budget else the country is bound to face the consequences of no economic progress.

Abubakar Yunusa (APC, Gombe) noted that capital budget must be higher than recurrent expenditure, if the budget’s impact must be felt by the citizenry.

Abubakar Chika (Niger, APC) warned that the legislature and the executive must unite to chart a course on how to implement the budget, if the country is to witness sustainable development.

“This is because the current structure does not support development, espcially at the grassroots. As such, we need to improve the lives of the people by building superstructures.

”We need to move away from this structure that has reduced governance to providing borehole, tricycle, motocycle because these will not help sustainable development,” he said

Muhammad Monguno (APC, Borno) noted that no matter the size the of the budget, it remained in the realm of estimate.

He said without effective implementation, the budget remained meaningless to the people.

His words: “As long as the budget is not implemented to the letter, Nigerians will be deprived of the full benefit of the budget.

”My concern is the abysmal implementation of the budgets which has remained a clog in the wheel of our progress.

”The National Assembly does its job by passing the budget but the implementation has always been a problem; so, there’s a need for the parliament to take the bull by the horns and do something about the implementation of the budget.

”If benchmark price for crude oil was up by 28 percent, why the dismal performance of the 2017 budget?

”I can tell you that some agencies I oversight had 10 percent budget performance. So, there is need for the National Assembly to take oversight serious.

”If this legislative intervention can be done through constitutional amendment, let us do it to enable significant improvement on implementation of our budgets.

Isiaka Ayokunle (Ogun) condemned the document, saying it was meaningless since his constituency was largely ignored in the scheme of things.

”I’ve not seen anything tangible that can move this country forward in this budget.

”As long as the unemployed youth in my constituency were not considered since there was no provision made for Ewekoro Cement, as long as Sango-Ifo road, the third busiest road, was not in 2018 budget, then the budget is nothing.

”Asked by Hon Monguno how the extra money gained from the benchmark was spent on the 2017 budget and how much was put in the purse, Ayokunle said:

”Who conducted the needs assessment of our people that was the basis of the 2018 budget and arrived at this document?”

Lasun said the House would adjourn tomorrow but stressed that the matter would be revisited following an appeal by Gbajabiamila.

Gbajabiamila had earlier asked that time be given for the MTEF report to be considered and adopted before matters on the budget are concluded. The debate continues today.

Some senators described the document as “unreliable estimates”.

To Senator Enyinnaya Abaribe, it as “fictitious, imaginary and dead on arrival”. Senator Joshua Lidani called it “wishful thinking”.

For Senator Ben Murray Bruce, the fiscal estimate is “a budget of active imagination”.

All of them are PDP senators.

Senate Leader Ahmed Lawan sought the leave of the senate to mandate Abaribe to withdraw the word “fictitious”.

Lawan said: “You cannot describe the budget presented by Mr. President to a joint session of the National Assembly as a fictitious document.”

Abaribe noted that if the word “fictitious” was unacceptable, “I withdraw it and rather say that the budget is “imaginary and unreliable”.

The lawmakers spoke on the general principles and second reading of the budget as contained in a Bill for an act to authorize the issue from the Consolidated Revenue Fund of the Federation N8,612,236,953,214 only .

Of the amount, N456,458,654,074 is for statutory transfers, N2,233,835,365,699 only is for debt service, N3,494,277,820,219 is for recurrent (non-debt) expenditure; N2,427,665,113,222 is for contribution to the development fund for capital expenditure for the year ending on the 31st day of December, 2018.

Lawan, who gave the overview of the budget, noted that in keeping with the administration’s policy, 30.8 per cent (N2,652 trillion) of the aggregate expenditure was allocated to capital budget.

The Yobe North lawmaker said fiscal operations would result in a deficit of N2,005 trillion or 1.77% GDP.

He reminded his colleagues that the deficit will be partly financed by new borrowing estimated at N1.699 trillion.

While 50% of the borrowing will be sourced externally, the balance is to be sourced domestically, and the balance of the deficit of N306 billion is to be financed from the proceeds of privatisation of some non oil assets by the Bureau of Public Enterprises (BPE).

Lawan also reminded his colleagues that the budget was predicated on the following assumptions: Oil price bench mark, $45 per barrel; oil production estimate of 2.3 million barrel per day; exchange rate of N305/US$; real GDP growth of 3.4% and inflation rate of 12.4%.

Hardly had Lawan concluded his overview of the budget estimate when Abaribe took the floor.

He said: “The 2018 budget is designed to consolidate on the achievement of 2016-2017 budgets. What was done in 2017 when less than 15 per cent of that budget was released. Nothing was done. That is why I call it fictitious. I withdraw the word ‘fictitious’ and say that it is totally imaginary. Nothing was done in 2017. That is fact that we all know.

“As at last week, the total receivables that government got was one-tenth of what was stated publicly. Instead of the budget in 2017 of more than N800billion to be received, what was received was N150 billion. In what sense will this 2018 budget be predicated on an assumption that the facts have already been destroyed. You are assuming N11 trillion, yet you are getting less than N1trilion.

”This is imaginary. We beg this government to be very specific in the indications of the assumptions underlining this budget. The assumptions are totally wrong and totally off the mark.”

Senator Joshua Lidani (PDP Gombe South) described the performance of the 2017 budget especially as it relates to capital performance as very abysmal.

He added: “It is expected that by the end of the year, only 50% of the capital fund would have been released. It is not certain that that amount would be released. So we end up having budget that has performed below expectation. Unless we get the 2017 budget analyzed, what went wrong, we will be building the 2018 budget on a very weak foundation.”

Senator Ben Bruce (PDP-Bayelsa) said: “We have downgraded our economy and the reason we are downgraded is we cannot meet our revenue projections is understood that this is a budget of consolidation; I would rather describe it as a budget of active imagination.

”If you look at the budget from 1960 to the present, you have agencies that were designed for 1960, agencies that were designed for the Nigerian civil war, agencies that were designed to suit some certain conditions in life. Sixty years later, those agencies still exist in the budget. If you look at the budget, you will see some agencies, they get recurrent expenditure, they pay salaries, they get houses, computers, cars but they have no money to do any work. No money to do any work; we pay salaries. Some agencies are so bloated it defies logic but these agencies exist. So, we have 2.4 million people consuming 60% of the recurrent expenditure of Nigeria, it doesn’t make any sense.

”I called President Obasanjo on phone two days ago and he said to me; the National Orientation Agency was necessary when we had no political parties. What is the value of the National Orientation Agency in today’s world, for instance? Yet billions of Naira is spent in that agency.

”Let us look at agencies that make no sense. FRCN, sell it to the staff. FRCN has 8, 000 workers; sell it to them. Sell NTA to the staff. Voice of Nigeria; who listens to Voice of Nigeria? Sell it. If the staff want to buy, let them buy it. Set up a cooperative like Awolowo did; sell it to them. If we spend 71% on recurrent expenditure, we will never get out of this predicament we find ourselves.

“I sent a letter to the Minister of Transport and I asked him to send us the contract he has with the Chinese. Let’s say we spend 10 billion dollars with the Chinese and they give us a loan, what percentage of that money is spent in the local economy? How many Nigerians are employed? Which steel product are we producing locally? The last time I checked, rail lines were produced 300, 400 years ago. It’s not rocket science. We have Ajaokuta Steel. So if we have the capability of producing steel or we have the capability in slow motion of making this work as Nigerians, we don’t need to borrow $10 billion from the Chinese and then give them back $10 billion; what do we benefit in our economy?

”The United Nations projected that in February 2018, Nigeria will have more people in poverty than in India. We have a population of 180 million people, India has 1.3 billion. Then, if we are going to have more people in poverty than India, then we have to create jobs. Once we create jobs, we can then export our Naira to China, to India or some other place.”

Senator Gbenga Ashafa noted that the 2018 budget cannot be effectively discussed without going back to previous budgets and considering how the budgets performed.

Ashafa said that the major problem of the country’s budgets had been poor funding.

He noted that the budget could be big but without money to fund it, it makes no sense.

He said, for instance, that only N700 million had been released from the budget of the Ministry Transportation out of N11.4 billion.

Ashafa urged Senate to ensure that enough funds are always released to fund the budget in the interest of development.

He also sought a speedier procurement process.