Matters arising from 2018 budget

The disagreement between the executive and legislative arms of government over the Federal Government’s budget is understandable. It is part of the checks and balances of a democratic government. It is, therefore, not surprising that President Muhammadu Buharil has expressed some reservations over the 2018 budget. The President had, while signing the N9.12trn 2018 budget into Law, accused the legislature of making fundamental alterations in the original budget proposal he submitted in November 2017.

The President said that when he submitted the budget proposal to the National Assembly, he expected that the legislative review process would be quick and move Nigeria to a January-December financial year. The importance of this, he explained, would have had a “significant accelerator effect on the financial plans of other tiers of government”, and impact the private sector of the economy, which operates on a January-December financial year cycle.

He claimed that the alterations made by the lawmakers on critical projects may make the budget “difficult, if not impossible to implement.” The cuts in the allocations of the critical projects, he noted, amounted to N347bn affecting 4,700 projects. Instead, the President said, the lawmakers introduced 6,403 projects of their own, totaling N578bn. Some of the projects affected by the cuts include the provisions for the Mambilla power plant, the Second Niger Bridge/ancillary roads, the East West Road, Bonny-Bodo Road, Lagos-Ibadan Expressway, Itakpe-Ajaokuta Road project, among others. Also, a total of N11.5bn was cut from these projects, the President claimed, stressing that some of the new projects inserted by the lawmakers have not been properly conceptualized, designed and evaluated, and will be difficult to execute. He said that some of the new projects introduced into the budget had been added to the budgets of most Ministries, Departments and Agencies (MDAs), with “no consideration for institutional capacity to execute them or the incremental recurrent expenditure” that may be required. Nevertheless, the President reluctantly singed the budget into law.

Swiftly, the National Assembly refuted most of the claims, describing the figures he reeled out in respect of the key projects, as incorrect and misleading. The National Assembly also said that the adjustments and the number of projects approved were made in order to address geopolitical imbalances that came up with the executive proposal. Such alteration, it said, was done to promote the principles of federal character as contained in Section 14 (3) of the 1999 Constitution (as amended), which states that “the composition of the Government of the Federation or any of its affairs shall be carried out in such manner as to reflect the federal character of Nigeria…”.

Also, the lawmakers debunked the President’s claim that the total cuts of the projects was N11.5bn. Rather, the reduction was less than N3bn. The lawmakers refuted the President’s claims on the 2nd Niger Bridge and the Enugu Airport rehabilitation, insisting that the President misinformed the public on the two projects in question as there was no “existing contract” for the 2nd Niger Bridge, while the outstanding payment to contractors for the upgrade of the Enugu Airport was increased by N200m.

They also defended the increase in the budget of the National Assembly, and argued that it was necessitated by drastic inflation of the last four years and maintained that what it did in respect of the 2018 budget was within its powers as provided in Sections 4, 80 and 81 of the Constitution. The lawmakers said that they acted in good faith and that their decisions benefitted the three arms of government and were mutually agreed on with the Ministry of Budget and Planning.

Beyond the disagreement between the executive and the legislature, it is high time the blame game stopped. It is clear to the public that both the executive and legislative arms have not adopted the right attitude and sense of responsibility towards budget matters. Their disagreements have led to the delay in the budgeting process as well as implementation.

It has become a perennial problem for the heads of MDAs to avoid appearing before the relevant committees to defend their respective budgets. Sometimes, they wait until they are compelled to do so. That has been the alibi used by the lawmakers to delay the budget.

We urge the executive and the legislature to work in harmony to restore the January- December budget cycle. Working at cross purposes in budget matters is not in the best interest of the economy. Going by the provisions of the Fiscal Responsibility Act 2007, the budget estimates should be with the National Assembly around September of the year. But the 2018 budget, like the previous budgets, got to the legislature not earlier than November. With this delay, key economic policies and programmes are likely to be adversely affected.

The National Assembly should focus on its constitutional mandate and not overreach its powers. There is need for the legislature to fast track the passage of the Organic Budget Law still pending before it. The law will give the President the power to propose estimates at anytime in the financial year. But for that to happen, Section 81 of the Constitution should be amended. The president must sign the Constitutional amendment Bill that will realise the January-December fiscal cycle. Let the lessons from the 2018 budget be used to improve future ones.