2018 Budget: Another watery soup for a sick giant?

The nation is in darkness. It needs stable Power. Mambila  Hydro Plant is a major plank in our power plans. Our contribution is 15% of the total cost. That contribution is 312 billion naira. We budgeted 18 billion naira for it in 2007. In 2018, we have proposed 9.8 billion naira.  Rome was not built in a day.


But at this rate, Mambilla Hydro may never be built. The second Niger Bridge was promised in 2011. It didn’t make the budget till 2015. The project has a cost of about 117 billion naira. When we released 2 billion naira  a few months ago for the project we blew trumpets. In the 2018 budget proposal we allocated to the project only 10 billion naira.

Evidently the second Niger bridge is a long way away. Four budgets have met local wing of the Port Harcourt airport. They have all left it in its tattered state. The Enugu-Onitsha road has remained impassable after 5  annual budgets. It’s unlikely 2018 would look its way with any real intent. It’s even worse. Only a fraction of these paltry sums  allocated to these important projects will be eventually released before we go into another ritual.

So barely 4 months after he signed the 2017 budget, the president was in the National Assembly. He delivered a speech that lasted over an hour. That was remarkable. That must have felt like a marathon for him. It was  2018 budget proposals. He came with the usual overflowing entourage. He was there in December 2016 to present the 2017 budget of recovery and growth. That budget got lost a few times. By the time it was born, it had spent half its life in the womb. It came with maggots too. It’s one month to its expiration now. The capital projections in that budget have been left  largely unattended to.

President Buhari agrees that budget has literally not been implemented, fundamentally.  Only a paltry 20% of capital votes has been released.  That budget had been praised for its 30% capital vote. President  Buhari  calmed frayed legislative nerves. He promised he would do some magic in what is left of the year. He would get 50% of budgeted capital votes released in the next one month.

The 2016 budget before it suffered a similar fate. By the December of 2016 only  18% of capital votes had been released. The budget was rolled over. It’s life was extended to march 2017.  That extension allowed the budget set a record. It managed to achieve 75% capital projection compliance. The excuse  for non compliance has been the same. Expected revenues could not be realized. Projected loans could not be sourced.

So why the fuss about another budget presentation?  All the budgets have looked alike, watery.  The  2018 budget  of 8.6 trillion naira  looks large. But it’s essentially  hollow.  Its  recurrent expenditure  estimates stand  at a head spinning 3.4 trillion naira. It  has  a provision of a whooping 2 trillion  naira  for  servicing existing debts.  With nothing left for infrastructural development , It had to have a deficit of 2 trillion which will be financed by borrowing, largely. No one is certain loans would be found. The finance minister hasn’t found loans to service the 2017  capital budget yet.

A close look at that budget shows that it plans to  walk on a tight rope. 2017 was a little fortunate, stable. Oil is projected to remain at about 45 dollars a barrel. That’s optimistic.  2018 oil production is projected at 2.3million barrels a day. That could be optimistic too.  There are already rumbles in the Niger Delta. And there is no visible urgency on the part of the Federal Government to check the situation.  The budget leaves no margins for disruptions. Yet 2018 is election eve.

There has been no real attempt to reform the public service. The president announced  the recurrent  expenditure projections of 3.5 trillion with discomfort.  He told the legislators that he has placed an embargo on employments into the ministries and agencies. But it was the same  president who last week announced he would appoint more ministers to placate his party men. He had said that the nation now had the funds to pay more ministers.

The size of  our recurrent expenditure leaves the  nation perpetually malnourished and leaves little hope for meaningful development. It is true we have saved billions by weeding out ghosts. The independent Payroll and Personnel information System has been useful. But the public service needs a radical surgery. Exorcising  ghosts is good , but  pruning indolence,  thousands of workers, is unavoidable. Our systems have to be digitalized

Nigeria seeks to realize over 4 trillion from non oil receipts. That again is optimistic. Independent revenues and recoveries have fallen short in  2017 as they did in 2016. When they fall short,  capital projects bear the brunt. So if these proposals are founded on so much optimism why are we  excited again?  I watched the finance minister promote the 2017 budget. I saw the conviction on her face. Then I saw her lament it’s failed implementation a few weeks ago. She simply said, they couldn’t find the money to finance it.  And that was that.

So why all the fanfare again?  I heard the legislators shelved a protest against non implementation of the 2017 budget. They believe approved budgets are laws that must be obeyed. That’s  too idealistic.  A budget that relies on exaggerated ability to mop up revenues and on the benevolence of potential  creditors cannot be such a binding  law.

That misunderstanding must be why they trample on themselves to infiltrate  budgets with dubious items in the name of constituency projects. Our budgets would be laws the day  we earn more than what we plan to spend.

Rather than these wasteful  ceremonies , the executive and the legislators should sit-down and reconstruct the recurrent expenditure. We have to be clear eyed. These rigmaroles help no one. We should only borrow to fund infrastructural projects that have beneficial multiplier effects on the economy.  We are already  drowning in  wasteful debts. We can’t live prodigally, borrowing to pay salaries.  Let them sit down and make sure there are no maggots in this budget.

We can’t afford to dedicate hundreds of millions of naira  to  the Aso Rock kitchen every year and hope to become another  Singapore. Let them sit down and block the leakages in revenue collection. JAMB remitted 7.8 billion naira recently but it had remitted only 3 million in a whole decade, previously. The government once talked about selling assets. Now it’s just idling while social infrastructure rots.

Categories: News

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