Monday Column By Hameed M. Bello, PhD
hamdbelo@yahoo.co.uk
The National budget of Nigeria, just as of many other countries of the world, is the strongest fiscal tool that the executive arm of government uses to bring about national growth and development, the economy being a central focus. Accordingly, any delay in the budget for a fiscal year will not only retard the economy, but will slow down overall national growth and development. The percentage of the budget that is implemented, out of the total budget figure signed for a given fiscal year, is a yardstick for the measurement of the integrity of the budget cycle.
The first tenure of President Muhammadu Buhari administration between 2015 and 2019 recorded huge amounts of budgeted funds returned to the coffers of government because the Ministries, Departments and Agencies (MDAs) of government could not execute the projects for which the monies were meant. One of the reasons for that is the late passage of the Appropriation Act. For instance, the President had signed the 2018 budget on Wednesday June 20, 2018, six months into the fiscal year. The total budget for 2018 was N9.1 trillion, up from the N8.6 trillion estimates he submitted to the Assembly on November 7, 2017. As for 2019, he signed the appropriation bill into law on Monday, May 27, 2019, five months behind schedule. The two chambers of the National Assembly had passed the budget on May 16, six months after it was presented by the President and raising the total figure by N500 million.
As a consequence, the Presidency and some MDAs had reportedly returned the sum of N118 billion to the national treasury as unspent capital budget for the 2017 fiscal year. That amount represented 8.1 percent of N1.4 trillion which was the total capital budget released, almost four times the size of the Federal Capital Territory Administration (FCTA) budget in 2017, which was put at N30.3 billion.
Out of the N10.9billion released to the presidency as its capital budget, only N10.7 billion was utilized leaving a total of N200 Million as unused which was returned to the treasury according to a document titled, “2017 capital performance for ministries, departments and agencies (MDAs) as at June 12, 2018” from the office of the Accountant-General of the Federation. By the document, as cited in news reports, Mr. Babatunde Fashola, then of the Ministry of Works, Power and Housing topped the list of Ministers with highest amount of capital budget balance returned to the government coffer.
While Ministries of Works, Power and Housing had N66.9billion, Ministry of Trade and Investment returned N22.8 billion as unused capital budget.
Other MDAs of the Federal Government in the category of top ten unused capital budget included Office of the National Security Adviser with N6.1 billion, Ministry of Finance, N4.3 billion, Ministry of Health N3.5billion, office of the Secretary to the Government of the Federation N3 billion.
Also, Ministry of Education had N1.8b, while Ministry of Solid Minerals and Water Resources had N1.4b and N1.1b respectively. The National Population Commission (NPC) had N33.4 million, Ministry of Environment with N24.8 million and Head of Service, N13.1 million.
The Ministry of Youth Development had N1.9 million followed by Ministry of Foreign Affairs which had N2.5 million and Ministry of Labour and Employment had N3.2million,
Others were Ministry of Interior, N4.5 million, Fiscal Responsibility Commission N5.7 million, Niger Delta Ministry, N5.9 million and Defence which had N6.9 million. This amounted to N101.5 million. However, the National Emergency Agency (NEMA) with issues around its emergency preparedness had returned as much as N193 Million unused capital budget. Out of the total releases which stood at N266 million, only N72.5 million was utilized leaving a balance of N193.5 million at a time the agency’s air ambulance and rescue helicopters were reportedly grounded over expired insurance policy that cost between N20million and N17 million for the two aircraft respectively.
The document also showed that the National Pension Commission (PENCOM) did not utilize the entire N375 million released to it for capital project while the National Hajj Commission of Nigeria (NAHCON) also failed to use its allocation of N298 million. This trend continued up until 2020 in the second tenure of the Buhari administration when concerted efforts were made to reverse the ugly trend.
To that effect, Buhari demonstrated commitment in restoring the January to December budget cycle, to be able to deliver more tangible projects and ensure that monies budgeted for infrastructure and growth plans were spent for those purposes, if at least to make governance more meaningful to the people.
Beginning from 2020, Nigeria returned to the January-December budget cycle after President Buhari signed the N10.59 trillion Appropriation Bill for that year into law. Buhari’s assent to the budget then, less than one week after it was transmitted to him by the National Assembly, marked the third time since Nigeria’s return to civil rule that the country would begin its fiscal year in January. Except for 2001 and 2007, Nigeria since 1999 up till 2019, had had the signing of its annual budgets delayed into a new fiscal year, leading to poor implementation of the budget, with the capital component of the budget worse hit. The delay consequently restrained business leaders and operators from investing in order to know the budget direction before spending their monies.
In what seemed like a build up on the progress of 2020, President Buhari signed the 2021 budget into law on Thursday, December 31, 2020. The signing of the budget came exactly ten days after both chambers of the National Assembly passed the N13.6 trillion budget for 2021 and three days after, it was transmitted to Buhari for assent. The implementation began promptly in January 2021. The legislators had approved N13.6 trillion (13,588,027,886,107) against the N13.08 trillion earlier proposed by the President, after they had added N505 billion to the proposed budget.
And on Friday December 31 2021, the President signed the 2022 Appropriation Bill titled “Budget of Economic Growth and Sustainability” into law. The N17. 126 trillion budget was earlier transmitted to the President by the National Assembly on Friday, December 24 2021. The executive/Legislature synergy that exists in the second tenure of the Buhari government helped to smoothen subsequent budget passage. The President had submitted the proposed 2022 Budget of N16.391 trillion to the joint session of the National Assembly on Thursday, October 7, 2021, calling on the legislators to give it a speedy consideration which they obliged.
As for the 2023 Budget, the Senate President Ahmed Lawan last week said that barring any last-minute changes, President Buhari will sign the appropriation bill on Tuesday, January 3, 2023. Lawan confirmed that to State House correspondents last Friday after a closed-door meeting with Buhari at the Presidential Villa, Abuja.
He said: “We are looking forward to Mr President signing the Appropriation Bill 2023, by the grace of God, on Tuesday.
“This is because we signed the document yesterday (Last Thursday), having lost some time because of some anomalous figures we had in the bill presented to the National Assembly (NASS).
“But thank God, the NASS in both chambers have passed the Appropriation Bill 2023 on Wednesday, and I’m sure that Mr President and his team, on the executive side, will work on what we have done.
”And the first thing on Tuesday, the first official working day of the year, I believe that Mr President will be signing the Appropriation Bill 2023.”
Lawan lamented that the NASS would have passed the bill a week earlier but for irregularities spotted in the bill.
“We are very pleased that we have been able to, in the last four years, ensure the passage of the appropriation bills in record time before every Christmas, and Mr President had always signed before the end of the year.
“This year, particularly, is because of the anomalous, very undesirable and unfortunate situation that we had to delay a little bit.”
He said the cordial working relationship between the executive and the legislature has regularized the signing of the appropriation bills since 2018, resulting in a “predictable January to December” budget for our country.
The Executive and the Legislature can indeed collaborate more on the issue of budget passage without compromising on their core mandates. A way to achieve that is for each of the two arms of Government to treat the other with mutual respect and be more open and honest in their joint dealings to reduce the margin of conflict. Although we cannot rule out conflict in governance, they could be resolved by telling each other the truth and have the courage to abide by them. One of the reasons for the conflict in budget consideration, just as the Senate President suggested, is padding which could be done at the Executive or the Legislature end. Either way, National interest must prevail against individual or group interest to pave way for better budget performance.
