Budget: Figures, figures, just figures

In this report, Associate Editor, KUNLE ODEREMI, takes a look at the passage of the 2017 budget and how successive annual budgets have fared in terms of implementation and their benefits to Nigerians.

It is an annual ritual. Federal, state and local governments roll out financial outlay on how the machinery of state will be oiled towards meeting what Maslow aptly encapsulated as the basic needs of man. This hierarchy of needs comprises biological and physiological needs – air, food, drink, shelter, warmth, sex, sleep; safety needs – protection from elements, security, order, law, stability, freedom from fear; love and belongingness needs – friendship, intimacy, trust and acceptance, receiving and giving affection and love. Others are the self-esteem needs – achievement, mastery, independence, status, dominance, prestige, self-respect, respect from others, as well as the self-Actualization needs – realising personal potential, self-fulfillment, seeking personal growth and peak experiences. And this theory of hierarchical needs has since been expanded to include cognitive and aesthetic needs, as well as transcendence needs.

Successive administrations announced their conscious and deliberate efforts to actualise the Maslow theory of hierarchy of those needs through budgets that come with alluring names. Thus, over the years, the less perceptive had hoped to have an unimpeachable access to the basic good things of life. At point in time, the budgets constituted a major catalyst for achieving the template of the hitherto three-year National Rolling plans that featured prominently during the period of military interregnum in the country.

But the politics of Second Republic,  which was characterised by a gross abuse of office by the principal actors tragically culminating in the adoption of strangulating economic measures termed austerity measures. The excruciating pains occasioned by austerity measures paled into insignificance, given the apocalyptic effects arising from the introduction of Structural Adjustment Programme by a military regime, which ahead promised to project a human face. The self-effacing military establishment midwifed again introduced the concept of the  Vision 20:2020, which with all intent and purposes, according to the initiators and promoters, would not only make Nigeria the African Tiger but also guarantee access of majority of Nigerian to the basic needs of man.

Today, that promise to turn stone into bread from Kaura Namoda to Effurun remains a tall dream, even about 18 years after the restoration of civil rule in the country. What remains not to have been in short supply is the consistency in the varying nomenclatures of agenda and budgets to actualise the former. From the era of former President Olusegun Obasanjo, to that of the late Alhaji Umaru Yar’Adua, down to President Goodluck Jonathan and now, President Muhammadu Buhari, Nigerians have been bombarded with different economic blueprints, all driven by ‘gargantuan’ budgets. Armed with huge capital allocation, Obasanjo had pumped colossal amount of funds into the Turn-around Maintenance (TAM) of the ‘moribund’ refineries, road rehabilitation, prostrate power sector, with no commensurate results. He had eloquently declared his commitment towards fighting corruption, revitalising agriculture towards ending a mono-cultural economy, and pursuing vigorously a privatisation progamme of government enterprises. In all, Obasanjo had hinged the economic philosophy of his administration on his belief that “government has no business in business,” which meant that all the then existing government projects, plants, enterprises, refineries and shareholdings in industries, trade, banking, finance and agriculture would be privatised and sold, so that government could focus on governance. “The Presidency, the Office of the Accountant-General and the Auditor-General will monitor and account for state expenditure. The Federal Tenders Board and that of the ministries will be reactivated and given wider powers to make sure contracts are awarded to competent firms. This procedure, with the implicit transparency and competitiveness, will eliminate the so-called Nigerian factor that adds as much as fifty percent to costs of contracts. Parliamentarians will be receive salaries and allowances that are enough to stop them from committing fraud and other malpractices. I will expose and severely punish all those who do not heed this admonition,” he promised.

There was the Seven-Point Agenda of Yar’Adua, which centred on giving fillip to critical sectors as power and energy; food security; wealth creation; transport sector; land reforms; security and education. The Jonathan administration, which was an offshoot of the Yar”Adua’s came up with a Transformation Agenda, with one of the priorities as waging a decisive war against the Islamist Boko Haram sect from the Nigerian soil. In all these circumstances, the major instrument that the government relied on in its ‘promise’ to grow the economy and boost the Gross Domestic Product (GDP) of the country was federal appropriations, which is majorly determined by the inflow of revenue accruing from the sale of crude oil. A report, for example said as at the end of December 31, 2013, federal, state and local governments in the country had spent more than N80 trillion, based on federal and states’ budget appropriations and statutory allocations. According to the report, all the tiers of government collectively spent N8.89 trillion a year; N740.74 billion a month; N24.35 billion daily and N1.01 billion per hour. However, the said N80 trillion expenditure did not include the internally-generated revenue of local councils and some supplementary appropriations by state governments. For instance, there were reports that in 2008 alone, the 774 local governments in the country received N1.05 trillion as statutory allocations from the Federation Account and about N1.2 trillion in 2009. In short, from 1999 to 2007, they reportedly received N3.3trillion, just as they got about N3.8 trillion as statutory allocations between 2010 and 2012. Sadly, only about N24 trillion or 30 per cent of the N80 trillion that accrued to all the levels of government was spent on capital projects while N56 trillion or 70 per cent was squandered on recurrent expenditure. With an average of 68.66 per cent of the appropriation allocated to recurrent expenditure (salaries, emoluments of public servants and political office holders, running costs, etc), the critical sectors that should have a direct bearing to the welfare and aspirations of the majority of the citizenry are bound to suffer from neglect. re is really no cause for cheer. Most states of the federation operate similar budgets. The beneficiaries of the huge expenditure comprise federal public servants: members of the Federal Executive Council; 472; members of the Senate and the House of Representatives totalling 469; state executives; 2,664; state lawmakers; 1,152; local council executives, 3096; local government councillors 8,692; and federal/state judiciary, 934, all aggregating to 17,474, while only about 34 per cent is used to care for the cater for the needs of rest of the nation’s population. Those needs include the provision of infrastructure and public utilities like potable water, roads, power supply, diversification of economy from a mono economy, and bringing an end to gas flaring, as well as rural integration, and more importantly security of lives and property. But, the budget has neither been implemented based on the need to have a human face, as regards to fundamental issues that affect the majority of the citizens of the country. This position was underscored by a financial expert, Mr Emmanuel Eze, who stressed that the country could not compromise the full implementation of the capital budget if it hoped to bring joy to the face of the majority of Nigerians. Eze, Chief Executive Officer, Perfecta Investment Trust, said the diligent use of funds for projects such as modern railway network and building of new roads was imperative to stimulating the economy which have a positive effect on the people. “Stimulating the economy through earmarking of funds to key infrastructure is the panacea to our current economic woes. The economy will gradually edge out of recession and the gross domestic products will be improved upon,’’ he said.

Budget implementation

The general perceived failure of the government to use the instrument of budget to address the fundamental needs of the people has consistently worried most stakeholders in the country. Professional organisations, university lectures and the organised private sector frequently come up with various interventions aimed at improved implementation of budgets. One of such bodies is the Lagos Chamber of Commerce and Industry, (LCCI), whose president, Chief Solomon Onofowokan, identified budget implementation as still a major problem at the federal level. He believes a timely presentation of the budget preferably by October every year, building the capacity of the civil servants in project management, decentralisation of expenditure approval processes, partnering with the private sector in project implementation within the context of Public Private Partnership (PPP) and better communication between the Executive and the Legislature on budget issues could bring better times.

In the opinion of four dons at the Obafemi Awolowo University (OAU), Ile Ife, Olaopa Olawale; Ogundari Ibikunle; Fagbohun Francis, and Adelowo Caleb, in a joint work on budgetary issues in Nigeria, budgets constitute an essential tool for government in decision making, and that since a budget is a contract agreed upon annually by the executive and legislative arms, it allows the executive agencies and departments of government to raise and spend public funds in a specified ways for the coming year based on specifics. “Also, budget serves as a planning device used to translate present scarce fiscal and human resources in the MDAs into future goals and programmes. In this respect, budget serves as a vital instrument for tapping and mobilizing human resources, how human talent at this level and public monies will be utilised as well as what tasks government will perform.” In addition, budgets is a political document, reflecting through the allocation of funds the ultimate desires, interest and power of various groups within the body politic as expressed by elected legislative bodies. Thus, budgets reflect the quality and quantity of the MDAs, and the support which the people will give such government MDAs. Provided there is proper participation, budget at this level encourage goal congruence and increase motivation.”

However, the university dons observed that undue rivalry and power play between the executive arm of government and the Legislature was increasingly becoming a common phenomenon. Their words: “Most of the legislators at all levels had, in the past, abused the system of democratic governance to the extent that it had, often been used as a device for settling differences between them and their executive counterparts, as well as for their emancipation from the manacle of political inferiority, especially when they are not from the same political party, camp or geopolitical zone….For instance, it has always been the usual habit of the legislators at all levels of government in Nigeria that the executive should seek approval in ramifications even if a particular project had already been approved in the budget.”

They added: “Giving the above various misunderstanding of the constitutional stipulations as regards the issue of fund and the various actors, the issue of budget, its preparation and roles expected of it, budgeting and budgetary procedures have been inefficient and ineffective particularly as it relates to financial management. This has been a clog in the wheel of both governmental and budgetary processes and progress in some part of the country. Thus, there is need to arrest the situation and call the concern parties to order before our governmental system becomes addicted to it. While there is need to caution our legislators on the use of their authorization, appropriation and approval powers as regards the control of public funds, the executive too should be made not to see their executive power of approval as a means of sidetracking, neglecting or jumping the necessary laid down procedures of budgetary process.”

Similarly, the Economic Confidential, in what it entitled: “Budget: Rituals without Meaning,” described budgeting as the principal instrument of fiscal policy used by governments to encourage stable growth, sustainable development, prosperity, and optimum employment in the economy. This, according to the business outfit, outlines the degree of activities and costs, as well as the specific programmes required for the implementation of the programmes. Accordingly, it declared: “Budget implementation is important because it assesses government performance over time. An effectively implemented budget improves and strengthens the various macro-economic ingredients like poverty, unemployment, inflation, and the financial systems.” But, the implementation of budget remained the major source of squabble between the NASS and the executive arm of government, with the former, at a time, threatening an impeachment move against former President Obasanjo for constitutional breaches over budgets passed by the legislature.

After prolonged political manoeuvres, the NASS passed the 2017budget of N7.441 trillion, almost five months after President Muhammadu Buhari proposed N7.298 trillion. The lawmakers hiked the expenditure under the proposed estimate by N143 billion. A breakdown of the passed budget tallies with the established tradition of staggering figures that tend to raise the hope of most Nigerians, only for those lofty desires and dreams to turn out to be huge disappointments, a trend the late music icon and legend, Fela Anikulapo, vividly captured in one of his evergreen albumst thus: water, light, I no dey. The import of that lyric resonates strongly in the sermon delivered by the Bishop of Remo Diocese and Archbishop, Ecclesiastical Province of Lagos, Most Rev. Olusina  Fape, at the 30th memorial service of the astute politician and statesman, Chief Obafemi Awolowo, that, “Today, aspirants into various political offices merely talk about seven or six or five-point agenda, as mere rhetoric without full understanding of what they are talking about.”