Monday, January 18, 2016

Nigeria's 2016 budget of fraud and self-aggrandisement

As at the time of writing this piece last Thursday, the Federal Government 2016 budget presented to the Nation­al Assembly on December 22, 2015 have been reported missing by the Senate. My initial re­action is that this must be a crude joke. Howev­er, when Senate President had to set up a com­mittee to find the missing document, reality dawned on me. This is incredible and prepos­terous! How can a sensitive document like a nation’s appropriation bill develop wings and flew away from the hallowed chamber of the Senate? On Wednesday, January 13, House of Representatives Speaker, Rt. Hon. Yakubu Dogara asked Clerk of the House to display the House’s copy of the budget.
The FG 2016 budget has been a subject of intense controversies since it was presented late last year. For me, the document is a mixed grill of the good, the bad and the ugly. In par­agraph six of his budget speech delivered by President Muhammadu Buhari, he stated: “This Budget proposal, the first by our Gov­ernment, seeks to stimulate the economy, making it maore competitive by focusing on infrastructural development; delivering in­clusive growth; and prioritising the welfare of Nigerians. We believe that this budget, while helping industry, commerce and investment to pick up, will as a matter of urgency, address the immediate problems of youth unemploy­ment and the terrible living conditions of the extremely poor and vulnerable Nigerians.” Re­ally?
In paragraph 17, PMB said his government adopted “a zero based budgeting approach, which ensures that resources are aligned with government’s priorities and allocated efficient­ly. This budgeting method, a clear departure from previous budgeting activities, will opti­mise the impact of public expenditure.” We shall soon see if this is true.
Some of the good things I found in the budget proposals are as follows: pursuit of macroeconomic stability by achieving a real GDP growth rate of 4.37 per cent and man­aging inflation. This is to be done by align­ing fiscal, monetary, trade and industrial pol­icies. Ratio of capital to recurrent expenditure is also reported to be 30:70. This is unprece­dented!
Am also thrilled by FG plan to partner with State and Local Governments to recruit, train and deploy 500,000 unemployed grad­uates and NCE holders. Equally laudable is the intention of the FG to provide financial training and loans to market women, traders and artisans, through their cooperative soci­eties. Also, the plan to work through the of­fice of the Vice President with various devel­opment partners to design an implementable and transparent conditional cash transfer pro­gramme for the poorest and most vulnerable.
Many public commentators, including my­self, have since queried how the FG intends to fund all these laudable programmes. Pay­ing 500,000 teachers alone will almost con­sume the entire budget, let alone the free meal for public primary school pupils and payment of the N5, 000 social security benefits to the unemployed as promised by the APC during the presidential campaign. Another poser to the president is: when is the commencement date of these goodies or freebies? What will be the cost sharing formula among the three tiers of government and have the states and lo­cal governments made provisions in the 2016 budget for their share? How are we sure that these laudable programmes will not be abused by those to be saddled with implementation? These are genuine fears as N1.84tn will be sourced from local and foreign borrowings.
Indeed, the N820bn oil re­lated revenue ex­pected in 2016 was based on wrong assump­tion that oil will sell at $38 per barrel. A barrel of crude oil at present sells below $30. Even the non-oil revenues of N1.45tn comprising Company Income Tax, VAT, Customs and Excise du­ties, and Federation Account levies, as well as N1.51tn from independent revenues may altogether not be realised unless the leakag­es in the country’s revenue system is proper­ly sealed.
The ugliest and most painful thing about the 2016 financial estimates is the waste and ostentatious lifestyles it tends to guarantee for ‘people in government’. My friend and fellow columnist, Eze Onyekpere who is also the Lead Director of Centre for Social Jus­tice, Abuja in an article entitled “Of Buha­ri’s 2016 budget of frivolities (1)” published in The PUNCH of Monday, January 11, 2016, exposed some of the ridiculous spending fed­eral government intends to make in this year.
At the State House Headquarters: the sum of N107.252m is earmarked for welfare pack­ages; N89.172m for the purchase of Canteen/Kitchen Equipment and N764.671m for con­struction/provisions of recreational facilities. Furthermore, the sum of N1, 652,416,807 is provided for rehabilitation and repairs of elec­tricity; N326, 084,876 is for wildlife conserva­tion while N268, 900,000 is for computer soft­ware acquisition. Again, N387, 980,200 is for general renovation of “the guest house” while a princely sum of N45m is for complete fur­nishing of the entire rooms in the guest house.
The sum of N272, 646,891 is for the upgrad­ing of mechanical and electrical underground power line supplies to the State House whilst N322, 421,971 is for linking of cable to driver’s rest room at Villa admin. N213, 873,953 is for linking of cable from guest house No.9 Gener­ator House to Gate. The sum of N618, 604,265 is for the installation of electrical light­ings and fittings in the State House, whilst N191, 592,132 is for electrical installation of distribution boards and other cables. N3.63bn is set aside for the purchase of BMW saloon cars; N158m is for the purchase of 33-seat­er coaster buses, while N204m is for the pur­chase of 16-seater Toyota Hiace coaster buses.
For the SGF, the sum of N823, 267,218 is for welfare packages; N1, 710,322,610 for the purchase of security equipment whilst N396, 795,997 is for rehabilitation and repairs of electrical components. N115bn (no break­down) is earmarked for the National Assem­bly. All the above did not include the billions to be used to maintain the 10 aircrafts or more in the Presidential Fleet.
This government is setting aside humon­gous amount for welfare packages, wildlife con­servation and recreational facilities as well as wanting to buy exotic cars at ridiculous sums of money thereby depleting our lean foreign exchange. Given the above scenario, can it be said that this current administration is differ­ent from the past ones?
•Jide is the Executive Director of OJA De­velopment Consult, Abuja. Follow me on twitter @jideojong