Poor implementation of 2017 Budget: Senate tackles executive, says Nigerians will die, if we continue like this
THE Senate, yesterday, tackled the Executive arm of government over the poor implementation of the 2017 budget and the release of about 15 per cent of the N2.177 trillion voted for capital projects. Worried by the huge gap in the capital budget and the actual amount released so far, the senators warned that the trend could cause serious injury to the economy and citizenry.
The Senate spoke while drilling the Minister of Finance, Mrs Kemi Adeosun and her Budget and National Planning counterpart, Senator Udoma Udo Udoma, for over two hours, yesterday. The duo appeared before the Senate Joint Committee on Finance and Appropriations where members of the Committee asked the ministers various questions ranging from revenue profile to what had been released so far to the Ministries, Departments and Agencies, MDAs of government.
For 2017, the Federal Government had a budget of N7.4 trillion of which N2.177 trillion was voted for capital projects. So far, Mrs Adeosun said N341 billion has been released for capital projects. Frowning at the poor implementation of the budget, the lawmakers warned that if not corrected and improved on, it could hurt the All Progressive Congress ,APC, in the next election. Senators at the meeting sharply disagreed with the Federal Government over plans to release only an insignificant fraction of the N2.177 trillion capital vote in the 2017 budget. Answering questions during the meeting, Adeosun and Udoma who told the senators that the government lacked adequate funding for the budget, said the government intends to release over N100 billion this week, in addition to the N310 billion earlier released for capital projects. Senator Danujma Goje, Chairman of the committee said: “If the trend of poor releases continues like this, Nigerians will die off. It’s not good to raise people’s hopes and dash them.
In implementing the January-December fiscal system, we should be careful not to sacrifice half of the 2017 budget.” To roll over 60% of 2017 capital projects to 2018 Adeosun revealed that federal government intended to roll over, at least, 60 per cent of 2017 capital projects to 2018 budget, adding that there is no stoppage in terms of capital releases and projects simply continue. Adeosun hinged the decision to roll over 2017 budget to 2018 on the advice of the Senate Committee to the Executive. N2.3 trillion deficit in 2017 budget The ministers noted that it would be extremely difficult for the government to meet obligations in capital budget, pointing out that there was N2.3 trillion deficit in the 2017 capital budget.
Adeosun, who noted that the 2017 budget was projected mainly on external borrowing, said making further capital releases would depend on how fast the government could push the borrowing process, adding that domestic borrowing would not be enough to fund the gaps in the budget. She stressed that the cost of domestic borrowing was getting too high, noting that borrowing from foreign sources was far cheaper than domestic borrowing.
The Finance Minister stated that even if the funds were to be available, government cannot release the entire N2.177 trillion capital vote within the three months left in the year. Consequently, the Ministers said about 60 per cent of the 2017 capital budget would be rolled over to the 2018 budget, just as that of 2016 was similarly rolled over till May 2017. N340.9 billion released for capital projects She revealed that the federal government has so far released the sum of N340.9 billion to fund capital projects for which the sum of N2.177 trillion was budgeted, adding, “at the end of this week we would have released about N440.9billion on capital budget for 2017.”
Mrs. Adeosun told the senators that the government could only release N440.9 billion of the total amount. N1.5 trillion released for recurrent expenditure The Finance Minister, who told the Senate that cumulative releases on current expenditure was N1.5 trillion, said Statutory Transfers is N128.8 billion; Funds for Pensions, N37.8 billion; Overheads, N92.4 billion; Service Wide, N223.6 billion; Capital Expenditure, N340.9 billion and ‘’we successfully raised a N100 billion to be released this week. At the end of this week, we would have released about N440.9 billion on capital budget for 2017. “Note that there was no stoppage in terms of capital releases and projects simply continue. The administration is focusing on completing prioritized projects that were critical to the administration. So we will keep the capital going to ensure that the projects are not disrupted from completion.” Adeosun said the N100 billion raised from the Sukuk, a non- interest diaspora bond, would be released to the Ministry of Works to enable it carry out some infrastructural development.
Speaking further, the senators, who drew a parallel between Nigeria and Brazil in the handling of economic recession in the two countries, said the Brazilian economy had suffered recession for eight consecutive quarters but came out of it with 2.46 inflation rate and 10 per cent misery rate. The legislators asked the ministers to explain why the Nigerian economy, which suffered recession for five consecutive quarters would come out with 16.5 per cent inflation rate and over 50 per cent misery rate, which thy described as disappointing. In her response, Adeosun said the difference was in the better infrastructure that’s obtainable in Brazil, arguing that the South American country enjoyed 24-hour electricity supply.
She attributed the wide gap in the inflation rates between the two countries to the nature of the two economies, adding that Brazil operates a diversified economy, with emphasis on massive agricultural production. She blamed Nigeria’s slow growth on poor infrastructure and dependence on oil revenues as major source of foreign exchange earnings. On his part, the Director-General, Budget Office, Ben Akabueze, told the Senators that out of the N2.05 trillion earmarked to fund the 2016 budget, only N1.2 trillion has been realized so far. Why we drilled ministers – Senator Goje Speaking earlier, Chairman Senate Committee on Appropriations, Senator Danjuma Goje said the two ministers were at the National Assembly to brief the committees as well as Nigerians on the implementation of the 2017 budget, adding, “it is very important bearing in mind that the budget was passed by the National Assembly in May and was signed into law by the then Acting President, Yemi Osinbajo on June 6, 2017.
“We are now four months into the implementation of the budget. Nigerians need to know how far we have gone and what we are going to achieve.” We have heard from the minister of budget and national planning that they intend to submit the 2018 budget this month. By implication, if they bring it this month, they will expect the budget to be approved before the end of the year.” Also speaking, Chairman Committee on Finance, Senator John Enoh said the seriousness of the session was underscored by the fact the Senate first’s resolution on this matter was for the two ministers to appear at the plenary but ‘’the latter resolution is what has brought us here and the wisdom is that a session like this will be more detailed.’’ Vanguard