The nation last week returned to the path of controversies which had been the hallmark of 2016 budget since its presentation on December 22, 2015 as both the executive and the legislature continued their cat and mouse game. Omololu Ogunmade and Olaseni Durojaiye write on the suspicion entertained by the executive concerning the budget passed by the legislature and also revisit the controversies trailing the budget since it was presented by President Muhammadu Buhari
When President Muhammadu Buhari presented the budget estimates in December 2015, the assumption was that it will enjoy a speedy process of passage considering that the ruling party has majority members in both chambers of the National Assembly. But that was not to be. The first threat to the estimates was oil price at the international market, which at the time fell below the $38 benchmark set by the executive. But the executive allayed fears concerning that when it made known plans to improve on collection of taxes, levies, custom duties and its promise to block leakages that fuel fraud.
While the government has recorded some measure of success in blocking leakages evidenced in the discovery of ghost workers running into over 25, 000 through initiatives of the Ministry of Finance, same cannot be said of its promises to improve on tax, levies and customs duties collection. It is, however, on record that the Minister of Finance, Kemi Adeosun, promised to adequately equip the Customs Service in order that it improves on its revenue collection schedule.
Quick on the trail of that was the controversial disappearance and reappearance of the budget estimates at the Senate. The drama that followed was similar to a drama of the absurd and before long hopes that the budget will be passed by February became a mirage. As that drama reached denouement, it emerged that the document was full of errors, and all forms of anomalies leading to extension of time needed to process it.
A few days after the nation heaved a sigh of relief following the passage of the 2016 budget by the National Assembly, Nigerians last week returned to the realm of uncertainty which has characterised the budget process since inception.
The adoption of reports of the Senate and House of Representatives’ Committees on Appropriation and the eventual passage of the budget by both chambers on March 23 brought a relief to many Nigerians.
Both chambers had announced the passage of N6.060 trillion 2016 budget, the highest in the nation’s history so far. The budget had a reduction of N17 billion from the initial N6.077 trillion proposed by the executive.
Chairman of the Senate Committee on Appropriation, Senator Danjuma Goje, and his counterpart in the House of Representatives, Abdulmumini Jibrin, told journalists on March 23 that the budget had been duly passed and largely cleansed of its errors, padding and duplication of figures.
In a manner that created the impression that the issue of 2016 budget had finally been laid to rest, Goje and Jibrin advised the executive to be more coordinated in the preparation of subsequent budgets. They noted that situations where ministers disowned their budgets during legislative process were not healthy for the system.
They also described the process as tedious and tough as Jibrin for instance, recalled how committee members had to shout at one another while others staged a walk-out during meetings preceding passage of the budget. The lawmakers also said the figures as presented by the executive were tinkered with, pointing out that the committee for instance, increased the budget of the armed forces, police and anti-corruption agencies in consideration of their genuine complaints.
These pronouncements were cheery news for Nigerians and they looked forward to a quick assent by Buhari and a promising 2016 fiscal year.
However, while the nation anxiously looked forward to the president’s assent and the subsequent implementation of the budget, the nation was shocked last Tuesday to see newspapers awash with stories of non-transmission of comprehensive budget to the president by the National Assembly. An unnamed source in the presidency who quoted Buhari as saying that only highlights of the budget were transmitted to him, added that the president had said he would withhold his assent from the bill until the comprehensive budget was transmitted to him.
It was learnt that the lawmakers transmitted highlights of the budget only for the president’s information with the intention to continue work on it in the background, hoping to transmit the complete document within two weeks.
It was also learnt that the National Assembly opted to quickly pass the budget just to ward off pressure from the public, having failed twice to meet its own deadlines. Therefore, the Appropriation Bill was hurriedly passed with the intention to conclude work on it in the background, just to avoid criticisms that will trail their Easter break without passing the budget.
But there is a strong suspicion by the executive that the National Assembly has used the opportunity of the errors in the budget to pad it for their own purposes. The position of the executive is further buttressed by the fact that the National Assembly only sent the highlights of the budget to the president without the details for assent. But the president has said he would not append his signature to the document without getting the details and proper vetting.
“Some bureaucrats removed what we put in the proposals and replaced it with what they wanted. I have to look at the bill that has been passed by the National Assembly ministry by ministry, to be sure that what has been brought back for me to sign is in line with our original submission,” the president said.
The parliament however does not see any big deal in the president giving his assent to the bill. Jibrin said it was not abnormal to send a passed budget for assent unaccompanied by the detailed information adding that it normally takes a week or two after a budget is passed for the detailed information to be ready.
“There is nothing abnormal about this practice and yet nothing abnormal for the president assenting a budget before or after seeing the details. In any case, the budget details are usually sent within a week or two after passing the budget.
“The appropriation committee needs to scrutinise the original proposal sent by the president vis-à-vis the reports of various Standing Committees of the House of Representatives and the Senate to arrive at a clean copy of the budget details. This will in no way affect any envelope already passed or the aggregate expenditure,” he said last week.
How the Budget Became Mired in Controversies
Since the budget was presented by the president last December, it has journeyed through several phases of controversies, a development which has continued unabated. The budget impasse began with the sudden disappearance of the budget from the custody of the National Assembly in January. The federal parliament resumed from its Christmas and New Year break on January 12 to find that the original document submitted by Buhari on December 22 had developed wings. In the heat of this controversy, the presidency opted to lie to the public by insisting that the budget was intact and remained in the National Assembly.
The Speaker of the House of Representatives, Hon. Yakubu Dogara, also made the Clerk of the House, Mohammed Sani-Omolori, to display a budget copy to create the impression that the original budget had not been swapped as the Senate had claimed.
Thus the public was held spellbound over the missing budget controversy until the Senate was forced to let the cat out of the bag some days later that the Senior Special Assistant to the President on National Assembly Matters, Senator Ita Enang, actually swapped the original document with another. The Senate therefore insisted that it would only legislate on the original document that Buhari officially submitted to them.
Buhari Admitted Correcting Errors
The threat by the Senate worked as Buhari along with his aides who had vehemently denied secretly replacing the budget was then forced to transmit a letter to the National Assembly. In the letter, for the first time, he admitted that there were errors in the original budget that he submitted which he had now corrected. The president then asked the National Assembly to discard the first document and legislate only on the corrected one.
Eventually, the dust settled since all efforts to keep the public in the dark over the whereabouts of the budget had failed and the truth had prevailed. Hence, the National Assembly, notably the Senate, which had minced no words in telling the public the truth about the ‘missing’ budget quickly put machinery in place to commence work on the budget. Consequently, it ended debate on the budget on January 27 and suspended plenary sessions to pave the way for various government agencies and departments to defend their budgetary allocations. The Senate for instance, assured Nigerians that they would give the budget an accelerated treatment and consequently pass the document on February 25.
That announcement was unprecedented as that was the first time that any of its chambers would set a date for budget passage. While making the announcement, Goje said the decision to accelerate the passage of the budget was to enable the executive have ample opportunities to implement it for 10 full months.
Budget of Errors, Fraud and Duplication
However, little did both the National Assembly and Nigerians know that the initial controversies which forced the presidency to secretly swap the budget would not end with Buhari’s letter. The main reason which forced the executive to secretly replace the budget was the reports in the media about over bloated budget figures for State House, a situation that was said to be worse than what Buhari and his party had accused the immediate past administration of President Goodluck Jonathan of.
The presidency was said to have been embarrassed that increasing its budget above that of the previous administration sent no message of change. But in the new budget, the presidency retained the budget figure and only redistributed it to other offices. It also retained a whopping N3.9 billion budget for State House Clinic, a figure that was far higher than that of all teaching hospitals in Nigeria put together. This accounted for why a former governor of Central Bank of Nigeria (CBN), Professor Charles Soludo, said the “2016 budget did not depart from Jonathan’s budget.”
After rejigging the budget, it was assumed that the document was now good to go, but hardly had the budget defence started than cans of worms were opened in the National Assembly. The budget was not only full of errors and figures that did not add up but had also been padded.
Indeed, the volume of strange figures smuggled into the budget was unprecedented in Nigeria’s budgeting history as the first budget prepared by ‘the government of change’ gave no sign of change. The situation looked so bad that many Nigerians wondered how a president who was described as a meticulous person could carry a document that he never vetted and presented it to the National Assembly and yet tagged it the budget of change.
Some Cases of Padded Ministries’ Budgets
The first case of padded budget was discovered on February 1, the first day of the budget defence by the Senate Committee on Education. The committee uncovered N9,982,258,479 tucked into the budget of parastatals by the Ministry of Education.
Whereas the entire personnel cost for the ministry and all its subsidiaries including schools and colleges declined drastically when compared to that of last year, only that of parastatals increased at geometric progression by almost N10 billion. The committee suspected that the huge sum was deliberately hidden under parastatals’ personnel cost.
Thus, education parastatals’ personnel cost rose from N88.1 billion in 2015 to as high as N98.1 billion in 2016 estimate proposals while the personnel budget of universities reduced by as much as N16.245 billion, declining from N227.2 billion in 2015 to N211.0 billion in 2016.
In the same vein, colleges of education budget went downward from N40.2 billion in 2015 to N37.6 billion while polytechnics’ personnel cost which was N61.44 billion in 2015 was reduced to N58.23 billion just as unity colleges’ budget had been cut from N288.7 to N7.588 billion.
However, while the ministry itself has its own budget cut by only N244.9 million from N3.768 billion in 2015 to N3.523 billion in 2016, UNESCO Paris is the worst hit with the drastic reduction of its budget from N288.3 billion in 2015 to N7.588 billion in 2016. The discovery was made by the Senate Chief Whip, Senator Sola Adeyeye, who described a situation where the personnel cost of universities had reduced by as high as N16 billion while parastatals that exist to assist the institutions had their budget increased by about N10 billion was unacceptable.
Asked to provide explanation, Minister of State for Education, Professor Anthony Anwuka, pushed it to the Permanent Secretary, Mrs. Folashade Yemi-Esan, who could offer no defence but only promised that the ministry would go back and look into it. The committee therefore asked the ministry to go back and correct the anomaly and return to it.
Another instance occurred when the Health Minister, Professor Isaac Adewole, announced that the original budget of his ministry had been distorted and loaded with strange figures. Consequently, the minister told the committee to discard the budget before it and await a new one to be re-submitted which he said would reflect the programmes of the health sector in 2016.
The revelation compelled the Chairman of the Senate Committee on Health, Senator Lanre Tejuosho, to announce an executive session with the minister with a view to thrashing out emerging issues on the budget as the minister further disclosed that there were some issues on which conclusion had not been reached by the ministry and yet allocations had been made to them without the ministry’s knowledge.
According to Adewole, the provisions of the budget before the National Assembly was in contrast with the priorities of the health sector as contained in the original budget it prepared adding that some of the votes earmarked by the ministry for some activities had been re-distributed while some important fields in the sector had been excluded.
He said: “In the revised budget as re-submitted, N15.7 billion for capital allocation has been moved to other areas. Some allocations made are not in keeping with our priorities. There is nothing allocated to public health and family health. Over the last two years, nothing has been done on HIV…
“We have to look into the details of the budget and re-submit it to the committee. This was not what we submitted. We’ll submit another one. We don’t want anything foreign to creep into that budget. What we submitted is not there. We have not reached that stage and we find the money there.”
Responding, the chairman had said given the submission of the minister, the budget before the committee was not the proposal of the Health Ministry and would therefore be of no use working on a budget that had already been disowned.
The situation continued to get messier as Minister of Information, Lai Mohammed, also disclosed during the time that N398 million proposal in his ministry’s budget for the purchase of computers was a smuggled figure.
Mohammed who made the remark while defending his ministry’s budget before the Senate Committee on Information had been asked to defend the allocations of N230 million and another N168 million for the purchase of computers for the News Agency of Nigeria (NAN) and Film and Video Censors Board.
Responding, he said: “No, that is not possible. That was definitely not what was proposed. This cannot be.”
An official of the ministry then said it was actually N5 million that was proposed for the items in the original budget of the NFVCB. Responding, Chairman of the committee, Senator Eyinnaya Abaribe, said: “The difference between N5 million and N168m is huge.”
The case of NAN was not different. Managing Director of NAN, Ima Niboro, had expressed surprise about the N230 million for the purchase of computers as captured under “capital votes” in 2016 budget of NAN, which did not originate from the agency.
Steps Taken to Clean up the Budget
The mess which characterised the budget defence compelled the National Assembly to announce a change in its initial plan to pass the budget on February 25.
Briefing journalists on the decision, Goje and Jubrin said the volume of controversies, errors and strange figures trailing the budget did not make the proposed date feasible.
The chairmen said their position had been strengthened by the disclosure by the executive that the budget was laden with errors adding that the situation implied that they needed more time to do a thorough job and simultaneously ensure that the budget was implementable.
According to them, the situation required a good time to clean the budget of all its ambiguities, errors and smuggled figures so that in the end, a budget that is acceptable to all can proceed from the National Assembly.
Thereafter, the National Assembly fixed March 17 for the passage. Again, the parliament failed, saying the errors and mess in the budget were too huge to be cleansed within a short time. But the National Assembly was forced to pass the budget on March 23 because of the traditional Easter holiday to be embarked upon.
Some analysts said the lawmakers could have proceeded on vacation while announcing that the Appropriation Committee would continue with the legislative process instead of hurriedly passing the budget and then creating another impasse.
Jibrin announced last week that the budget would be ready for transmission within a fortnight. Therefore, the nation is left without any option than to give the lawmakers the benefit of doubt whether they will live up to their promise this time or not.
Where the Parliament Erred
Many analysts believe that the parliament erred by merely transmitting highlights of the document to the president without explaining to him why it did so, a development which led to immediate reactions from the Presidency that the president’s assent would not be given to the budget highlights.
It was learnt that the National Assembly could have saved itself the embarrassment if it had sent a note to the president that it was tidying up the budget and would transmit it to him soon.
But the lawmakers were said to have failed to disclose the true picture of the situation to the presidency, thus giving rise to an insinuation that the National Assembly was playing on the nation’s intelligence.
During the week, members of the Senate Committee on Appropriation were seen working on the budget. The committee chairman, Goje, also declined to speak on the issue while his counterpart in the House, Jibrin, dismissed the threat by Buhari that he would not sign the highlights, saying it was not the first time the National Assembly would transmit highlights of budget to the president.
According to him, budget highlights were transmitted to former presidents Olusegun Obasanjo and Umaru Yar’Adua in their days in power without making issues out of it. He argued that the two ex-presidents signed the highlights without crying wolf as it is currently the case.
However, his colleagues such as Leo Ogor, said it was an aberration for the Clerk of the National Assembly, Salisu Maikasuwa, to have transmitted only highlights of the budget to the presidency. They wondered why the clerk would do that against the norm of lawmaking process.
In normal circumstances, when a harmonised bill is passed by the National Assembly, the clerk of the affected committee in the Senate will effect correction on it (if any) and send it to the legal department for thorough examination from legal perspective. After being certified okay by the legal department, the bill will be forwarded to the senate president for his signature.
The senate president will thereafter send it to the clerk of the Senate who will in turn forward it to the clerk of the National Assembly. The National Assembly clerk will then transmit it to the president for his assent.
But in the current situation, the reverse is the case as members of the committee who ordinarily should be on Easter recess were still busy working on the budget during the week. This was a clear deviation from the norm as it only confirmed that the document was an unfinished business at the time it was said to have been passed.
Another Battle Ahead?
Yet in faraway United States, Buhari fired a salvo, threatening that he would subject the budget to intense review after receiving it to ensure that what is eventually passed corresponds with what he proposed. This expression implies that another battle may be ahead even after the National Assembly transmits the budget to the executive.
It is a tradition in Nigeria for the executive and the legislature to be at loggerheads for several weeks after budget is passed as the executive always accuses the legislature of distorting budget proposals in the course of appropriation.
In 2013 for instance, when for the first time, the National Assembly passed the 2013 budget on December 20, 2012 before the takeoff of the fiscal year, its implementation did not begin until July 2013 as a result of accusations and counter-accusations between the executive and the legislature.
The executive had demanded the withdrawal of a number of estimates incorporated in the budget by the legislature, saying they were not implementable. But the legislature said by its constitutional power of appropriation, whatever it did with the budget should be final. This led to a protracted battle which continued till the end of the third quarter.
Eventually, when the battle for supremacy ended in July after an amendment to the budget was passed by the National Assembly, there was no enough time to implement most of the projects in the budget.
Therefore, unless a conscious effort is made to avoid such a scenario, there may be a rekindling of the 2013 budget debacle this year which may compound the already economic hardship being witnessed by Nigerians.
What Analysts Say
Though a good number of analysts, who spoke with THISDAY, predicted that the final budget to run with should be ready in a matter of days, a minority opinion envisaged yet another round of back and forth that may see the final budget not ready until “later in April”.
In reaching its conclusion, the minority opinion considered political reasons, particularly the power play within the ruling party and noted that only strangers to the practice of passing budget in the country will expect that the president will assent to it anytime soon. Though majority opinion maintained that the reasons why the president did not immediately assent to the budget was valid, they added that providing the required detailed information should not take the National Assembly more than days to come up with. They expressed confidence that the presidency was well aware of the urgency that the matter requires as the delay in passing the budget is almost grounding the economy to a halt.
Speaking with THISDAY in a telephone interview, Managing Director of Global Analytics, an investment firm, Tope Fasua noted that, “we are not strangers to budget delays; the back and forth is not new. Presidency’s reasons are valid considering that they’ve been embarrassed enough on the same matter, it’ll be stupid of the president to just sign the budget without thoroughly looking through what was passed by the executive; so I still expect another set of controversy and I see the budget being passed sometime later in the month of April.”
In the same vein, President, Oyo State Chamber of Commerce and Industry, Adegoke Ogunniyi, told THISDAY that, “I think we should have a solution within the next week or two. It is important that the president ensures that all details are in place. There is need to get it right; any unnecessary mistake will be a setback for the whole process.”
Director General of Lagos Chamber of Commerce and Industry (LCCI), Muda Yusuf, noted that the normal thing to do was for the Legislature to have accompanied the budget with detailed information when sending it back to the Presidency for assent adding that, “doing so now shouldn’t be a difficult thing to do.”
However, a government source who preferred not to be named insisted that he feared a “budget crisis” may be looming. Declining to put a timeline to when the final budget will be ready, he hinted that the executive may take some time going through what was sent back by the legislature.
“The executive need to thoroughly examine the budget, they have to be certain that there is no booby trap in the budget that was sent to the Presidency. Of course to do a thorough job requires some time. You are aware of the trial of the Senate President at the Code of Conduct Tribunal, bearing that in mind you will understand why the executive needs to be very careful and meticulous before Mr. President assents to the budget,” the source added.
Even though Senator Jibrin claimed that it was not abnormal to send a passed budget for assent unaccompanied by the detailed information and that there was nothing abnormal for the President assenting a budget before or after seeing the details, Yusuf told THISDAY that, “normally, detailed information should have been sent along with the budget; a summary note is not enough. I expect the president to assent to the budget in a matter of days. Presidency should also appreciate the urgency of the matter and expeditiously assent to the budget if the materiality is not significantly different.
“Of course you don’t expect that because of the urgency of the matter the president should not look at what was sent back to him to ascertain it is in agreement with his plans. What may pose a problem is if the material that was sent back to the president is significantly different from what he sent to the National Assembly,” he added.
According to Executive Director, Corporate Finance, BGL Capital Ltd, Femi Ademola, “if it is taking the NASS so long to get the details ready, it should be expected a lot of changes might have been included in the budget that would require a careful consideration by the president before giving assent,” he reasoned.
“It appears that the nation is in for a budget crisis,” a Port Harcourt-based economist, Ezeh Wordu, told THISDAY on the telephone.