Budget Of Deceit

 Huge sums of money may once again go back to government coffers as unspent funds of 2008 budget as a result of delay in the release of capital votes to ministries, departments and agencies, MDAs

 By Onu Okorie

 One thing the opposition cannot take away from President Umaru Musa Yar' Adua is his frugality. As governor of Katisna State, Yar'Adua had more money in the state treasury than any of his colleagues. In fact, it is said that this is what attracted him to former President Obasanjo to nominate him as his successor. In this regard, Yar'Adua has not disappointed his benefactor. 

At his independence broadcast to the nation on October 1, Yar'Adua said he has saved over N400 billion from unspent capital releases to ministries, departments and agencies, MDAs in 2007. This is the first time Nigeria will be announcing such huge recovery in the 48 years of nationhood. Analysts have however forecast that the figure might unarguably be higher next year.

Since he assumed office in May 2007, the president has demonstrated uncommon commitment to transparency and accountability in the conduct of government businesses. Mike Uzo, CEO Data Trust Ltd praised the existing cordial relationship between the executive and the legislature in budget making and implementation. “The environment for planning the budget and impressions coming out of the review processes in the legislature were beaming a ray of optimism about government fiscal conduct. The spirit of openness and transparency in government finances that departed from the nation since the mid 1980s seems to be reappearing. There is apparently a reasonable chance that the overall quality of government could improve, as law makers join force with the executive to submerge personal interests in agreeing the budget numbers.”

There is fear that this attribute of the president is taken to the extreme, and is fast robbing off on the nation and its people. For instance, the huge amount quoted as unspent fund in last year's budget is as a result of the delay in the release of funds to government agencies. The allocation for the National Assembly in last year's supplementary budget was released to the leadership only on December 31. This was promptly returned to the treasury as to spend it would run foul of the new rule. It was also argued that much of the money retrieved from the MDAs was probably released to them late in the year and so could not be actually utilised before the end of the year. The result was that many projects listed in the budget only ended up as paper work. Is there any lesson learnt in this? It appears the status quo ante remains.

Investigations by this magazine revealed that most MDAs were yet to receive their capital votes two months to the expiration of the 2008 financial year. By the new rule, any money unspent before December 31 this year will be returned to government coffers. That is why pundits are predicting higher figures next year when the president will be taking stock of unspent funds for the 2008 budget. In the alternative, it would be logical if the MDAs could represent their capital votes to the presidency for appropriation in the 2009 budget.

The president could be excused in 2007 because he took over the reins of government at the middle of the year and because that budget was not initiated by him. But the same excuse cannot be given for the 2008 budget. Many analysts see the 2008 budget as a platform for assessing the impact of the new administration on the economy, as the planning and implementation rest squarely on his shoulder. 

Yar'Adua has encapsulated his government progamme into a 7-point agenda. Transportation, health, energy, education, agriculture, housing and security form the major thrust of the administration's progamme. The budget was as well hinged on this policy thrust.

In the 2008 budget, President Yar'Adua proposed to spend the sum of N94.36 billion to improve and develop the transport sector. Some of the projects that would occupy government attention in the sector include the dredging of the River Niger from Lokoja to Warri and the construction of the second Niger Bridge at Onitsha. There would also be a bridge across River Benue at Bagama.

The N89.95 billion voted for agriculture and water resources in the budget was for the rehabilitation of Gurara water project at the cost of N7.2 billion. The project is to supply water to Abuja and its environs. The government also voted N3.4 billion for cooperative and community tractor service in 200 centres nationwide.

In order to meet the need of the human capital development, government made provision of N210.45 billion in the budget for education. Part of the plans was to upgrade infrastructure and technical facilities in primary schools across the nation.

Government also voted N114.4 billion for the completion of the 32 on-going power transmission projects and rehabilitation of key power stations nation wide. The aim was to achieve an increase in national grid to reduce the epileptic power supply that has become endemic.

Despite the huge sum of money voted in the budget for road rehabilitation and maintenance, the state of the nation's roads are appalling while the supply of electricity remained epileptic. The level of unemployment is rather getting worse as some companies which could not operate in the difficult terrain of the Nigerian environment are closing shops. At a time many manufacturing industries in Nigeria have relocated to smaller African countries that  offer a better operating environment than Nigeria. It is believed that many Nigerian entrepreneurs are relocating their industrial concerns to these other African countries. For instance, Michelin Tyre Manufacturing Company which operated in Nigeria for over 48 years, have closed their manufacturing plant and laid off thousands of Nigerians on their pay roll. Also, Dunlop Plc on August 23, 2008, laid-off over 300 workers in an effort to minimise operation cost. The company's public relations manager, Mr. Abiona Babarinde said that the affected workers did not lose their job on ground of incompetence but due to the present situation of high cost of production occasioned by defects in infrastructure.

Analysts have scored the implementation of this year's budget very low. Director-General, Manufacturers Association of Nigeria, MAN, Mr. Jide Mike said that the problem of infrastructure has placed the Nigerian manufacturers on a serious competitive disadvantaged position in the global market place, leading to huge dumping of goods from countries with lower production costs.

As the financial year is coming to an end, there is no doubt that most of the projects mentioned in the budget would become pipe dreams. For instance, the second Niger Bridge may enter the next budget plan as work is yet to start on it. During the recent inspection tour of the bridge, members of the senate committee on works could not hide their shock at the current state of the bridge, which links many parts of the country. The committee chairman, Senator Julius Ucha said there was no shred of doubt that the bridge was about to collapse.

Despite the skepticism that surrounds the implementation of the budget, one person who believes that the budget is doing fine is the minister of finance, Dr. Shamshudeen Usman. Usman said recently that Nigeria’s economic indicators point to a brighter future, arguing that the government of President Yar'Adua is moving on a good pace contrary to the opinion of many. He said government is taking its time to clear the rot of the past, while laying a solid foundation for the future. According to him, “our 23008 budget focused on the completion of on-going projects, while the supplementary budget focused on power, and transportation is being planned.

“Nigeria's economic performance has continued to be favourable, recent gross domestic product, GDP, growth has averaged 7.3 per cent over the last four years. This is bright prospect going forward.

“We are trying to go back to the basics, to do things right. We are getting back to fundamentals, getting to do things properly. Things were not done properly before. We are not slow; fiscal restraint has been the most underlying and supporting factor of the administration.”

However, President Yar'Adua seems to realise the underperformance verdict of the people, as he tried to access the effort of government in his independence day speech. According to him, “we are aware that our physical infrastructure deficit cannot sustain the level of economic development which we envision for Nigeria. This brings to the fore the imperative to rapidly rebuild, maintain, upgrade and expand our critical infrastructure. In our quest for practical solutions to our endemic energy problems, we have set in motion far-reaching reforms which have started to yield positive results.”

President Yar'Adua also admitted that rebuilding our national economy crucially demands reinventing and expanding the critical infrastructure and evolving sound policies that will clear the path to optimal socio-economic development, a step which he argues the government is already taking. He said, “We have commenced tackling the challenges in the energy, transportation, human capital, and security sector in a structured manner in order to make enterprises flourish in the country.”

But some Nigerians argued that the verdict of the president on improved infrastructure and strong economy may probably be existing in the government books only as it is not reflected in the economic welfare of the people.

Public analysts have continued to decry lack of adequate attention in the agricultural sector which seems to be the only solution to the problems of high cost of food items. Though the cost of food items seem to be at the front burner in public comment, high cost of accommodation is also a major factor affecting cost of living of ordinary Nigerians, which the budget has failed to address. Again, the increasing cost of transportation is a factor which cannot be undermined as it affects other aspects of the economy especially the food items and other household items.

Reaction of the Nigerian Labour Congress seems to reflect the mood of the masses. NLC President, Abdulwaheed Omar said the “organised labour shares the frustrations of the majority of Nigerians over the patent lack of progress in virtually all aspects of Nigerian life, relative to the outstanding accomplishments of other countries with which we started the journey towards nationhood. Those nations have accomplished remarkable feats in governance based on sound ethics, first class technological and industrial development, excellent infrastructures and high standards of living. To explain the Nigerian backwardness, we must again engage the vexing issue of poor leadership.”

Pundits are of the opinion that for the government to demonstrate readiness to develop infrastructure and impact on the life of people, it must start with diligent implementation of budget so that it would not sound like another beautiful hypothesis that ends up in furthering the frustration of the people.

Budget implementation has become a different ball game in recent times. For the eight years former President Olusegun Obasanjo superintended at the Aso Rock, the problem of non implementation of budget assumed a recurrent decimal, often resulting into stalemate between the executive and legislature.

 

We're Monitoring The Budget

 House Leader, Hon. Tunde Akogun, spoke to SAM UWODI on the performance of this year's budget

Three month's to the end of the 2008 financial year, how would you assess the performance of this year's budget?

Well, we in the House of Representatives, we followed the 2008 budget closely and ensured that, all ministries and parastatals carried the details of the budget. Also, we ensured that our committee on appropriation and finance monitors the operations and performance of the budget closely, and made sure that all arms of governments adhered strictly to the dictates of the budget. We had initial problems with the ministries and parastatals over their non-submission of their ministerial details on the budget. We complained to the minister of finance and the presidency directed the parastatals and ministries to comply with our requests, and they did. On the issue of non implementation of the budget,  three months to the end of the year, I want to categorically say that, most of the problems bothers on the fact that, being a new government, and coming out with its first budget, there has to be these teething problems associated with budgeting for a new government; most especially, for the fact that the government inherited some super structure from the former government and there is need for blending between a new government and the old one. Our initial problems over the lack of cooperation by heads of ministries and parastatals have been resolved.

There was this allegation of self-budgeting and budget padding levelled against the members of the National Assembly by the presidency. For instance, it was alleged that the law makers injected fictitious projects into the budget, thereby making the implementation difficult. How true is this?

No, there is nothing like self budgeting in all that we did in the budget for this nation. We did our best to streamline what the executive brought in terms of capital outline for the fiscal year. What we simply did was to look into the areas where there is under budgeting and we adjusted the expenditure portfolios of ministries and parastatals, and where there is over budgeting, we levelled it up, in other areas where there is insufficiency of funds. The same thing we did for other ministries and parastatals, we also did for the National Assembly. There were areas where we saw that what was allocated in these areas were not sufficient to carry out the demands of the organisation, so we made some adjustments.

The National Assembly members are committed and dedicated Nigerians who believe in the working of Nigeria. We are patriotic people, who came here to represent our people, and we can't appropriate the money that belongs to the people for selfish ends. We did our best to give the nation a working budget in 2008. We cooperated with the presidency to see to it that the dreams, aspirations of the people of Nigeria and that of President Umaru Yar'Adua is achieved for the nation. He is a very dedicated and committed person, who wants to build this nation on a solid foundation. We share his dreams and aspirations so, we didn't appropriate any money to ourselves.

 Many Nigerians have expressed frustrations over Nigeria’s patent lack of progress in virtually all aspects of living, relative to the outstanding accomplishments of other African countries. How have we fared as a nation?

We have fared well, judging from our circumstances and situations. You see, we have come a long way. We have seen several crops of leaders pilot the affairs of this nation since independence. But let me tell you that, the present crop of leaders will take us to the Promised Land. I believe that, with Yar'Adua on the saddle, slowly and steadily, the attitudes of Nigerians towards governance will change. This government has introduced cost-cutting and waste prevention measures, which resulted into the realisation of the N400 billion unspent funds, which was returned to the federal coffers. This money will boost the growth of the economy and the workings of the 2008 budget. The president has also said that, there will be no short cuts or a quick fix to the nation's problems. He is conscious of the importance of the generality of Nigerians, who are usually in a hurry to see their leaders take a hasty actions which often turn out counter-productive. So, we need patience with this government so as to turn around our economy and improve the lots of the citizenry.