Ndubuisi Francis and Udora Orizu in Abuja
The 2018 Budget proposal currently before the National Assembly is replete with frivolous, unclear, and wasteful expenditure items, the Centre for Social Justice (CSJ), has said.
CSJ stated that the N8. 612 trillion budget expenditure which represents a 16 per cent increase over the 2017 figure; retained revenue of N6.607 trillion, being a 30 per cent increase over the 2017 estimates and a deficit of N2.005 trillion lacks what it described as a big picture of the 2018 budget projections.
The Convener of CSJ, Mr. Eze Onyekpere, who unveiled the budget proposals at a civil society organisations summit in Abuja under the aegis of Citizens Wealth Platform (CWP) stated that the budget estimates contain frivolous, unclear and wasteful expenditure that are of no value to the nation and its citizens.
Onyekpere noted that key assumptions include the benchmark price of $45 per barrel of crude oil, daily production of 2.3 million barrels per day (mbpd) and an average exchange rate N305 to 1USD, projected real GDP of 3.5 per cent and inflation rate of 12.4 per cent.
The projected expenditure of N8.612 trillion, although high in naira terms amounts to a paltry $28.24 billion and when divided by 180 million Nigerians amounts to a per capita federal expenditure of N47,844.44, he argued.
“The budget like the Medium Term Expenditure Framework (MTEF) should be anchored on high level national policies and planning frameworks such as Vision 2020 and its implementation plans or the recently approved Economic Recovery and Growth Plan. Virtually all the budget codes start with ERGP which implies that they are drawn from the ERGP
“This is a good development considering that previous budgets of the administration lacked an anchor. However, merely using ERGP code does not necessarily show an anchor. Substantial compliance lies with interrogating the actual provisions to see if they are in tandem with the goals and objectives of the ERGP.
” A big picture is missing in the 2018 budget projections. The first issue is that capital expenditure is to take 28 per cent of the overall vote. While it looks good on paper, previous experience indicates that capital vote is very poorly implemented so it’s imperative for the administration to ensure that a bulk of capital expenditure is developmental rather than administrative.
“Nigeria is faced with massive unemployment and underemployment challenges. At the end of 2017, unemployment stood at 18.8 per cent and underemployment 21.2 per cent, so a budget that seeks to regenerate the economy should tie expenditure and its underlying policies to reducing unemployment and job creation but the budget was entirely silent on how its proposals would reduce the high unemployment figures.
“The budget also needs to be anchored on a robust and realistic economic, fiscal and developmental framework which emphasises domestic resource mobilisation and popular capitalism driven by the commitment of all members of the society, where every ready and willing Nigerian partakes in the baking of the cake and as such, claims right to be at the table on the sharing of the proceeds of national investments,” he argued. The rising debt service, it added, appears to be crowding out expenditure in critical infrastructure and human development, pointing out that the debt service which is 23 per cent of the overall vote when added to the sinking fund for the retirement of maturing bonds adds up to 23.22 per cent of the overall vote.
“So at 23.22 per cent of overall expenditure, the debt service is high. The missing of basic health care provision fund, which the executive and legislature have ignored for the past three years have continued in the 2018 estimates.
“The total sum allocated to health in the 2018 budget is N340.456 billion out of the total national budget of N8.612 trillion. This sum represents just 3.95 per cent of the total budget which shows that the federal government has clearly put the health sector in reverse gear. “Also, the MDAs’ votes are filled with frivolous, inappropriate, unclear and wasteful expenditure items. In the age of “buy made in Nigeria”, most MDAs are insistent on buying foreign products and even have the temerity to put the foreign brands in the budget when there are equally good locally made alternatives,” it noted.
According to CSJ, huge proposal for cleaning and fumigation and subscription for professional bodies which could be done for less than 50 per cent, of the requested sums were discovered while the annual ritual of buying computers and software was common.
‘This tradition is followed by a number of MDAs, voting money in an unclear way that does not tell the story of what exactly the vote is for is not a best practice,” CSJ said.
The faith-based non- governmental organisation explained that the budget and its underlying economic policy needed re-engineering and restructuring through a process that involves changes and paradigm shift.