Limits to parliament’s power of the purse

Nigeria-map-colourACCORDING to Wikipedia, the power of the purse is the ability of one group to manipulate and control the actions of another group by withholding funding or putting stipulations on the use of funds. The power of the purse can be used positively (e.g. awarding extra funding to programmes that reach certain benchmarks) or negatively (e.g. removing funding for a department or programmes, effectively eliminating it). One of the earliest documented use of power of the purse was the English Parliament’s refusal to authorize further taxes and raise revenue thus subverting the executive strength of the crown and denying King Charles II powers to engage in various war efforts.

The Constitution of the United States (Article 1 section 8) vests power of the purse in the Congress and this has been a veritable instrument for checking the Executive. Through the Foreign Assistance Act of 1974, the Vietnam War was ended as military funding to the government of South Vietnam was halted by Congress.In the same vein, Congress placed funding limits on the administration of Ronald Reagan, forcing the government to withdraw United States’ Marines from Lebanon. Congress also puts this fiscal power into use to control the direction of State Governments’ policies and laws in order to align them to Federal programmes. A good example of this was where Congress passed a law to withhold 10 per cent of federal funds for highways in any State that did not raise the drinking age to 21. The power of the purse serves as a check and balance between the Legislature and the Executive and is intended to mainstream the wishes of the people as represented by Parliament into public policy formulation. Parliament’s power of the purse is, however, often limited by the prescribed mode or manner of exercising the power which when not complied with renders such power and any action thereon void.

While initiation of legislation is concurrent to both the executive and legislature,  most constitutions saddle initiation of Financial Bills in the executive and the final approval in Parliament. The constitution of France(1958) and the USA (op cite) are clear and unambiguous in making the Government the initiators of money bills.  Section 81 (1 and 2) of the 1999 Constitution of the Federal Republic of Nigeria stipulates that 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 (including the Heads and to meet specific purposes) of the Federation for the following financial year to form the Appropriation Bill. Section 121 makes a similar provision for State Governments. The Nigerian constitution thus saddles the President or the Governor of a State the exclusive prerogative of initiating financial legislation while the legislators have the duty to check, criticize and pass or refuse to pass the appropriation bill into law. Most countries leave initiation of financial laws in the hands of the Executive because economic management for transformational growth and development has become more technical, intricate and complex and demands more resources beyond the reach of individual lawmakers. In order to generate the required synergy, the Budget Office needs to access information from and cooperation of the Ministry of Finance, the Central Bank, Accountant General’s Office, Federal Inland Revenue Services and other major revenue generating agencies, the Debt Management Office, the Federal Office of Statistics, the Auditor General’s Office and the Ministry of Works, Housing and Power and other major spending agencies.

The Budget preparation procedure at MDA level involves a bottom-up approach involving all departments and supervised by the Permanent Secretary culminating in the endorsement of the Minister before presentation to the Budget Office. For projects and programmes to be admitted into the budget, the Budget Office would evaluate their readiness, looking at conformity with long/medium term policy documents, project feasibility studies, project design and plan, vetted bill of quantities, site approval and soil tests, work plan, consultants report, baseline studies, identified milestones and key performance indicators.This painstaking and elaborate approach is to ensure inclusiveness along the project life cycle and ensure speedy delivery once the budget is approved. This thoroughness will be lacking if new projects are added along the line leading to non-performance of the budget and abandoned projects Another reason why most constitutions grant the president exclusive right to initiate money bills is because while each lawmaker is beholden to his or her constituency, the President’s constituency is the whole country and it behooves on him to maximise the public good for the greatest majority. The confusion about this doctrine of separation of powers enshrined in the Nigerian constitution is our Westminster background where members of the executive also belong to the legislature thereby blurring the lines of who initiates money laws.

The 2017 Budget of Recovery and Growth was presented by the president to the National Assembly in December 2016 with a total budget size of N7.3 trillion and was passed into law in May 2017with an upward review to N7.441 trillion. The question therefore arises as to whether NASS has the constitutional right to increase the budget size. According to Nigeria’s foremost Constitutional Lawyer, Prof. Ben Nwabueze, (2000), “Not only can the National Assembly not initiate financial legislation, it also cannot increase budget beyond what is proposed in the President’s appropriation bill. It can reduce but not increase. This is because an increase in the total amount partakes of the nature of the initiation.”

In another judicial pronouncement(Femi Falana v the President FRN & 3 Others) Justice G. O Kolawoleof the Federal High Court held that while the NASS is not expected to be a rubberstamp to whatever the Executive presents, it has no constitutional powers to increase the budget size or set aside what the Executive presents and substitute it with its own Estimates. According to Justice Kolawole: “The 3rd Defendant (National Assembly) was not created by the drafters of the Constitution and imbued with the powers to receive ‘budget estimates’ which the 1st Defendant (The President) is constitutionally empowered to prepare and lay before it as a rubber stamp parliament. The whole essence of the ‘budget estimates’ being required to be laid before the 3rd defendant, is to enable the 3rd defendant as the assembly of the representatives of the people, to debate the said ‘budget proposals’ and to make its own well informed legislative inputs into it. What the 3rd defendant cannot do is to prepare ‘budget estimates’ for the 1st defendant or to disregard the proposals laid before it and substitute it with its own estimates.”

While the FGN itself is guilty of lateness in transmitting the budget estimates to Parliament, another major cause for concern is the almost six months it took the NASS to consider and pass the budget. The international benchmark for legislative action on the budget is three months and that is why in some countries like France (1958) the constitution enjoins the government to submit the budget to the parliament latest by October and makes it also mandatory for the House to pass the budget within 60 days.

• Sodade, a retired Permanent Secretary, writes in from the United Kingdom.