If further proof was ever required that the change-promising APC government of President Buhari does not understand let alone start work on its much vaunted change agenda, one needs look no further than the 2016 Appropriation Bill before the National Assembly. Reports that the 2016 budget went missing, compounded accusations that the Presidency submitted two versions of the same budget; one by Buhari himself and the other by his Senior Special Assistant on National Assembly Matters (Senate), Senator Ita Enang. As if that was not embarrassing enough, the President wrote to the national assembly last Friday, formally requesting the withdrawal of the budget for correction. Obviously the figures for operations in the Presidency and the State House were outrageously higher than those of former President Jonathan. Amid public criticisms that went viral on social media, Sen Enang decided to secretly doctor the original budget, which bore none of the attributes of a change agenda and is, very shamefully, an ode to the conspicuous consumption attitude of the political class of Nigeria’s wobbly democracy.
Given Buhari’s austere nature and the change agenda of his party, the budget figures for the office of the president, vice president, and some ministries were a huge embarrassment to the president, who only discovered it from media reports. Lawmakers were shocked to discover that the document Enang distributed was different from what was presented by Mr. President. Ordinarily, the review process should have entailed a written request from the president to the National Assembly calling for the withdrawal of the budget, not a clandestine effort to surreptitiously change the budget figures by Enang. It is very doubtful that Enang decided on own volition to change the budget as an after-thought, without the greenlight from the presidency. This is unacceptable. And it is abominable. This can only happen in Nigeria. What a shame!
The budget is the single most important annual initiative of government and encapsulates all the momentous plans it has for the people. In a country where government has crowded out the private sector, despite bouts of privatization, and the public sector is the biggest business entity, the budget is the oxygen of national life. It, therefore, should embody the vision and bear the imprimatur of the president. Regrettably, Buhari appears to have surrendered the sovereignty of fiscal decisions to appointed officials.
It is a sad comment on the President’s style and an unflattering advertisement of his apathetic approach to the substance of the national budget, and this illustrates another poor dimension of the stature of presidential presence and duties and the amplification of the absence of good personal leadership examples from the person Nigerians elected to the job. The President should be the champion of his budget propositions, but he seems to be a back-seat driver, and this has not been helpful. The President owns the budget and can never delegate that ownership.
The 2016 budget seeks to spend N6.08 trillion ($30.8 billion) in 2016, an increase of about 20% from last year. It is based on an oil price of $38 a barrel. Revenue projection is N3.86 trillion resulting in a more than double deficit of N2.22 trillion, or 2.16% of the overall 14% debt to GDP profile. This deficit is developed by the Recurrent Expenditure (Personnel emoluments, Overheads and consumables), and will be plugged with N1.84 trillion of borrowing, N900 bn from international debt markets, with domestic borrowing of N984 billion. Oil sales will provide N820 billion, less than the N1.45 trillion projected for non-oil revenues such as corporate taxes and customs duties. Almost N1.4 trillion will be spent on debt servicing; that’s more than three times the N370 billion earmarked for education and six times the expenditure on health (N222 billion).
To begin with, the 30% capital expenditure proposed for the budget is too low. Considering the huge infrastructure gap in the country, it should have been 70% capital expenditure and 30% recurrent expenditure. Besides, the oil benchmark of $38 per barrel on which the budget is predicated, is unrealistic, because price fluctuations in the international oil market, have been hovering between $34 and $35. With dwindling government revenue, increasing the budget to N6trn from N4trn is too ambitious since the government had factored in the Treasury Single Account (TSA) which had brought all individual projects being executed by Ministries, Department and Agencies (MDAs) under one umbrella.
The 2016 budget provides barely any reason to expect development of infrastructure and even human capital. Under the very inadequate capital budget provisions are so many self-serving projects for the political elite, provisions for the State House and amorphous Presidency sends no signal of frugality or dwindling revenue. Canteen and kitchen equipment (N89.172m); recreational facilities (N764.671m); welfare packages (N107.252m) are no ways to change the fortunes of a nation! By the way, what happened to all the kitchen and canteen equipment bought under former President Jonathan? Besides, to vote N764.671m for mere recreation facilities at a time many Nigerians are going to bed hungry is not only insensitive but a sign of callousness. What kind of recreational equipment will cost that much?
Just listen to this: the Federal Ministry of Finance gets N500m for special programs to improve efficiency of spending; while the National Planning Commission (Infrastructure Master Plan) gets N500m. The implementation of the Nigeria Nuclear Power Program will get N2bn; while N60 bn is earmarked for Special Intervention/Constituency Projects. To begin with, the Efficiency Unit in the Ministry of Finance is not an agency but a collection of representatives of existing agencies monitoring federal spending to ensure fiscal discipline; which is a duplication of the statutory tasks reserved for the Fiscal Responsibility Commission (FRC) which got N494m. What then does it need N500m for? The Infrastructure Master Plan has already been prepared by the previous administration and therefore does not require N500m for its fine-tuning (whatever that means). Constituency projects (N60 bn) will only make sense if the projects are aligned to national priorities that improve livelihoods rather than massage the ego of legislators.
Against the backdrop of the president’s anti-graft war, whose epicenter has been the NSA, the 30 security votes in the 2016 budget raises awkward questions about Buhari’s commitment to the fight against corruption. The top 10 security votes amounted to about N9.3 billion ($46.5 million). The budget contains a N576 million ($2.9 million) security vote for the NSA, 10% less than last year. The State Security Service (SSS) will receive the largest security vote in 2016: about N2 billion ($10.4 million). The National Intelligence Agency (NIA), will get N1.2 billion ($6 million) security vote in 2016, while the Defence Ministry and the three branches of the Armed Forces will receive approximately N5 billion ($25 million). The inclusion of corruption-prone security votes is an embarrassment to all Nigerians.
