Editorial

Finally, budget 2018 is passed

Last week Wednesday the National Assembly passed the 2018 Appropriation Bill of N9.120trillion. This amount is the highest in the nation’s budget history. The figures is N50.8 billion higher than what President Muhammadu Buhari presented on November 7, 2017. This new estimates was jacked up by 6 per cent as against what the president had presented. The approved budget also came with fiscal deficit of N1.955bn, representing 1.73 per cent of the Gross Domestic Product, GDP.

Furthermore, the budget is predicated on oil benchmark of $51, crude oil production of 2.3mbpd and exchange rate of N305/$1USD. A further breakdown of the budget shows that N530.4bn is voted as Statutory Transfers, N2.2trn for Debt services. Out of this amount, N1.766trn is budgeted for domestic debt servicing, N254bn for external debt, and N190bn for Sinking Fund to retire matured loans. Also, N3.5trn is for Recurrent Expenditure and N2.8trn for Capital Expenditure. The Ministry of Power, Works and Housing, received the highest allocation of N682bn, followed by Transportation, N251bn, Defence, N149bn, Agriculture and Rural Development, N147bn, Education, N102.9bn, Health sector.

Lessons from the process that led to the passage of the appropriation bill this time are many. Although there were no wild open confrontations, however, it was sad that the neglect and sometimes refusal of heads of some Ministries, Departments and Agencies, MDAs to honour invitations to defend their budget proposals have been reported as one of the causes of the delay and the late passage of the 2018 budget. This is shocking considering that these MDAs are supposed to be defending their own budgets. Was it a case of willful sabotage or what? This must be avoided next time. Indeed we recommend that such officials must be reprimanded.

It is heartwarming that in spite of the drawbacks, the budget was eventually passed. Unarguably, both the executive and the legislature share the blame in the recurrent delays in the passage of the budgets. Besides, the frequent disagreement between the National Assembly and the presidency has taken its toll on the budget process and even implementation. Lessons should be learned from this to avoid a repeat occurrence. This has become necessary because the budget addresses growth in spending on critical areas relevant to the welfare and security of the people.

It is incumbent on both arms of government to be a bit more patriotic in handling the budgeting process. Especially so with the fact that the governing party controls the National Assembly; so whatever the issues maybe, both arms must be tolerant of each other rather than continue in this ego trip. Budget 2019 will be ready soon. The delay that attended this 2018 must be avoided, that’s how we learn lessons. There must be communication, especially in the formulation and passage of the budget and define the boundaries of responsibilities. This will minimise delay and other stumbling blocks in the budgetary process. In future, government should think deeply on how to reduce spending in areas where the private sector is better placed to handle. This will help free up funds for critical sectors like health, education, water and environmental/sanitation services, among others, that have not been receiving adequate allocations.

Of critical importance is the implementation of the budget. Before then is the expected delay and bickering that will attend the signing by the president. We are hoping that this normal delay will be minimised. All the dramatis personae in both arms should lock themselves up and deal with the ‘Ts’ and cross the ‘Is’ so that the document do not begin a yoyo movement. This is the year before election!

It is heart rendering that over the years, successive budgets had never achieved more than 50 per cent implementation, in particular, the capital components. Early this year, the Minister of Finance, Mrs. Kemi Adeosun, disclosed that only 21 per cent of the capital component of the 2017 was achieved as at December 2017; although it must be acknowledged that between then and now capital expenditure has been scaled up. Nonetheless, It will be a rare feat if the current budget will surpass that mark. Government and the various MDAs should strive to achieve about 70 per cent of the capital expenditure for once.

We urge the government to steer our economy and the nation’s revenue generating capacity away from just oil revenue as it is doing presently. With the current surge from oil prices going much higher than budget estimates, saving for the rainy day has become very critical.

Show More

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button