Eze Onyekpere is the Lead Director of the Centre for Social Justice headquartered in Abuja with specialisation in fiscal governance, political finance, and constitutional reforms. He speaks with IMOLEAYO OYEDEYI on the recently signed 2024 budget of Renewed Hope, among others.
THE Tinubu administration has just passed the 2024 budget into law. Like its predecessor, it has also prioritised defence, infrastructure, education, and health. As such, defence and security get N3.25trillion, followed by education which gets N2.18trillion. While health gets N1.33 trillion, infrastructure gets N1.32 trillion. The other item with high votes in the budget is social development and poverty reduction programmes which take N534 billion. Do you think these huge allocations will make tangible impacts when you consider the deplorable infrastructure, pitiable health system, and mass poverty that the country is grappling with?
The allocations are not huge. Firstly, let’s ask ourselves: how many good roads can you construct with the works ministry budget? Look at that of health, how many standard hospitals can you build with it? Same thing for education, so these allocations are not enormous when one considers the enormity of the country’s multi-dimensional problems. More importantly, a good part of these allocations is simply administrative capital. So, they are still not going to touch the common man on the street. In the budget, there is a huge sum under the Service Wide Votes. All the time from the Obasanjo’s government till the last administration, this tradition of excessive service wide budgetary allocation has existed. And the government keeps doling them out in ways and manners that nobody can account for. Don’t forget during the last administration, we had things like Trader Moni, and Farmer Moni all running into billions, yet we don’t have a credible national social register. Don’t forget that under the Bola Tinubu administration, the state governors all disagreed with the social register when it was time to share the palliatives. They claimed they would create their own and could not work with the federal government register. But since then, none of them has come up with any. So, I am not hoping that much will come out of the 2024 budget, whether you call it Budget of Renewed Hope or not unless Nigerians are sensitised enough to begin to demand value for money. Beyond the budgetary allocations, there is a need for a greater demand for accountability and transparency from the people. But as I see it, we do not have that education and sensitisation yet. It is more or less business as usual, which means nothing is going to change.
As contained in the budget, the federal government is expecting to generate about N18 trillion from Internally Generated Revenue (IGR) to finance the budget, but a greater part of this is expected to be derived through taxation. Don’t you think this may increase the harsh economic situation in the country?
I don’t think they (the government) are trying to increase taxes. Rather, I think they are trying to bring more people into the tax net, especially those who are supposed to be paying taxes but have not been paying. So the government is looking at bringing all these into the tax net, including those VATs being collected across the markets and private enterprises in the country that have not been properly and wholly remitted to the government account. So, what they are aiming at is to achieve more efficiency and effectiveness in the tax collection, not by increasing the tax rate, but by expanding the tax net. And I believe it is doable if there is that honesty of purpose. Moreover, we can still raise much more money if we stop oil theft and pipeline vandalism and properly account for our crude oil resources and sales.
However, the present government, like its predecessor, has allocated about N15.961 billion for both international and local travel. It will be recalled that Buhari’s government visited no fewer than 40 countries during the 84 business trips he made. But despite this, many companies still exited Nigeria, instead of having adequate investment being brought into the country during his eight-year reign. What do you think is the problem with these trips, because they consume much, but bring in very little?
The challenge is more on the ease of doing business index. Go and check where the country is on the index. You will see that it is among the worst performing countries in terms of ranking. So, it is not about going on expensive trips to convince investors, it is about the extant realities in your country. Look at the electricity challenge, for instance, the national grid is collapsing. Yet, you are telling people to come and invest. Dangote had to build power plants for his factories. How can that be, even when the security crisis is getting alarming? So, let President Tinubu sit back and discuss how to reduce the rising insecurity with the commanders of the country’s security forces.
Afterward, let him make sure that there is stable electricity, revive the education sector, and stop crude oil theft and vandalism. By the time the government puts all these in place, it won’t have to desperately beg investors to come in. This is because it is the country’s situation report that the investors will read before they can decide to invest in the country. But when an investor hears that big companies are closing shop in the country in droves, how do you think such an investor, if reasonable, will want to still bring his or her investment into the country? Also, look at the macroeconomic fundamentals like the inflation rate, interest rate, and all. Nobody who reads the macroeconomic reports will ever want to invest in the country. So, the government needs to sit back and fix the challenges at home, not to go abroad to paint rosy pictures of the country, which the investors will later find to be untrue.
What is your take on the increase the National Assembly made to the budget?
It is more or less the norm that the NASS will increase expenditure projections. But this time, I think they increased the exchange rate from N750 to about N800 per dollar, and given the promises by some MDAs to increase the operating surplus, they created an elbow room for increased spending. I have no problem with the increase, but the challenge I have is where they applied the extra projections of about N1.2 trillion. I had expected them to use it to reduce the budget deficit or to increase the investment in education, health, and others, but what they did was more like they increased their votes from about N190 billion to over N330 billion. They did not properly apply the money to key areas that many had thought they would put in the overall interests of all Nigerians. I had expected the increase to also be partly put on development capital projects, and the deficit reduced.
It has been observed that over time ensuring accountability and transparency has always been an issue in the implementation of the Nigerian budget. With this new budget of renewed hope, how do you think Tinubu’s government can infuse this into the budget implementation process?
If you look at the budget critically, you will discover that the part that impacts more directly on the people is the capital votes. It will be recalled that as of the time the 2024 budget was presented in December 2023, we were told that only 25 percent of the 2023 capital budget had been released to ministries, departments and agencies of government. So, assuring transparency and accountability presupposes that the budgeted money must be released. However, the NASS must provide legislative oversight to ensure that appropriated money is used for the exact purpose for which they were budgeted.
Secondly, we have the Fiscal Responsibility Act (Section 30) which provides for quarterly budget implementation reports to be produced by the Budget Office of the Federation and the Ministry of Finance, which will then go to the NASS and the presidency before being publicized through the media. The report is expected to come out no later than a month after the end of every quarter. So, if the government had been keeping to this law, the transparency and accountability in the budget implementation process would have increased greatly.
Meanwhile, I learned that the president said he would be setting up a special protocol for budget implementation monitoring. But then, they will still have to adequately communicate with Nigerians on the results of investment of public resources. This is because it is not just about spending money. For instance, if you have spent a certain public fund on education, you have to tell us the number of out-of-school children you have taken back to school out of the expended budgetary funds. If it is in the area of maternal and child death, you have to tell us the number of women you have rescued from dying during childbirth. So, there has to be a results framework that will be available to Nigerians from which we can determine the accountability for results and transparency in terms of your reporting.
How will you rate the budget 2024 defence process that was undertaken by the NASS?
Well, it is a continuation of the routine that is being done at the legislative assembly. But apparently, the lawmakers this time sped up the process, to deliver the budget before the end of 2023, which they succeeded in doing. To me, it was a welcome development that the NASS asked the MDAs to come forward and defend the budget, but next time, I think the lawmakers need to be more thorough in terms of pulling out frivolous, inappropriate, wasteful, and illegal expenditures. Why do I say this?
Firstly, it is on record that this is not the first time we will be dealing with petrol subsidy issues. It will be recalled that during the Goodluck Jonathan administration, some part of fuel subsidy were removed and we then had the SURE-P, which was like accounting for some of the savings of the subsidy that were realised. Even during the Abacha days, we witnessed the Petroleum Trust Fund (PTF).
However, this is the first time when we will be having the outright removal pf subsidy and large funds saved, but there is no programme or project where the funds that are saved from the petrol subsidy are tied to. Rather, the money appears to be frittered away through several channels like an increase in the recurrent non-debt expenditure, and the Service-Wide Votes, which are more like a slush fund, as well as a statutory expenditure for the National Assembly, Judicial Council, and the rest. But we haven’t seen much in terms of capital expenditure. And the bulk of the capital expenditure, even if much is to be provided, is administrative in terms of the vehicles they are buying, the buildings, computers, and others, which simply goes to service the bureaucracy. But there is little or nothing that will touch the common man in terms of good roads, bridges, new hospitals, standard schools, adequate water supply, and stable electricity, among others. So that is why I say the lawmakers should have been more meticulous in scrutinising the budget.
In your assessment, what are those excessive allocations you feel the NASS should have cut down in the budget given the harsh economic realities of the country?
At least, everybody before now has been talking about the presidency. We all know that in the Supplementary budget of 2023, the presidency asked for a lot of money for renovation of buildings, vehicles, etc. However, despite this, we still have a very huge amount of money being earmarked in the 2024 budget by the presidency for the same renovation and SUVs, which includes the construction of office complexes for aides and others, routine maintenance of mechanical and electrical installation pegged at N9.2billion, another purchase of vehicles for state house operations and replacement of SUVs, which is another N2billion. Yet, all these have already been approved in the 2023 Supplementary budget, which Nigerians have cried about. This, to me, is a duplication of frivolous projects and a waste of public funds.
Let me give an example of another agency that should have given the people some succor in terms of the effective deployment of public funds. We have the National Rural Electrification Agency, which is supposed to be working to make electricity more available for the people at the grassroots. If you look at their budget, you will cry, because you will see things like “provision of solar home system for vulnerable homes” in the South-South (N150 million). It was the same for the South-West at N150 million, and other geo-political zones of the country. We also have “provision of solar mini grid and productive use equipment for productive use of agriculture in North Central” and other geopolitical zones. But looking at this kind of proposal, the question is: where exactly in geo-political zones will these projects be situated? How can you even monitor them? What then is even the assurance that such a project will truly be done when there are no traceable details provided for them? Also, in the budget, they will tell you about “provision of the solar mini-grid with electric vehicle-charging capabilities for North-East, North-West”, and all other geopolitical zones. Yet, there isn’t any detail of where such projects, if at all they exist, will be situated. They just played on words. So, it appears there is an intention from the outset to mismanage the available funds and resources. And this has been the pattern over the years.
Even in the budget lines for the Niger Delta, we have projects like the Purchase and Installation of Transformers in Selected Locations across the Niger Delta. But we have nine states in the region, so where will the installation be done and how can you even monitor them across the nine states? There is also another one: ‘Supplies of furniture for Selected Schools in the Niger Delta (N100million). The question is where in the states? So, with the way the project lines are captured in the budget, one will begin to wonder whether the leaders are truly budgeting to cater for the things that will benefit the common people. It is more like they are working only for their purpose. That is the unfortunate scenario we currently find ourselves in the country.
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