The budget imbroglio

Deep into the second quarter of the year, the 2016 Appropriation Bill is yet to be signed into law and the National Assembly and the Presidency are still involved in accusations and counter accusations while the economy continues to suffer from lack of clear direction and the lives of the people continue to deteriorate. We recall that from the beginning the government’s handling of the budget has been less than impressive. Submitted quite late in the year, the budget has been dogged by controversy since then. At a time, it was alleged to have gone missing and the Senate had to set up a probe panel to go in search of the missing budget.  Then it emerged that the executive did a very poor job of the budget preparation leading to accusations of budget padding. After so many back and forth, the budget was finally passed by the National Assembly and had been transmitted to the president for accent. But apparently, the controversy still continues.

The President’s refusal to sign the budget was on the grounds that the National Assembly mutilated it, removed some capital projects, cut the amount allocated to others and introduced extraneous items into the budget. According to the presidency, some of the capital projects affected include the N60 billion Lagos-Calabar rail project, which was removed by lawmakers; reduction of Lagos-Ibadan Expressway by N24 billion; reduction of Second Niger Bridge by N3.9 billion; Benin-Sagamu Road slashed by N800 million; Kano-Maiduguri-Ngala Rail cut by N260 million, among others.  Reports have it that there’s currently a stalemate between the executive and the legislature and that the legislature has resolved to give the president 30 days within which to consider the request of the National Assembly and sign the budget into law or risked being overruled.

It is sad to see the lackadaisical attitude with which the government is treating the budget and by extension, the lives and fortunes of the country. Currently, everything is at a standstill in the country as a result of none signing of the appropriation bill into law. All capital projects cannot commence, contractors cannot be paid, allocations to ministries, departments and agencies cannot be made and key contractual agreements are breached with huge consequences for the country and the economy. This has led to the sabotaging of key public infrastructure projects at the federal, state and local government level and has consequently increased the cost of doing business in Nigeria.

The private sector is also adversely affected. The budget goes a long way in determining interests and exchange rates and fiscal policies. These, in turn shape socio-economic outlook, a basis on which investment decisions are made. The lack of a budget late into the second quarter creates so much uncertainty that harms the economy. Besides, the private sector does business with the government and its agencies and suffers hugely due to late and non payment for jobs done and disregard for contractual agreements reached as a result of delayed budget. This is not to talk of the problems of dwindling sales, weak consumer demand and the high cost of funds that delayed budgets engender.

But much more worrying is the fact that the non signing of the budget is fast shattering the hopes and expectations of the populace that voted for a government that promised them so much.  Since the budget is the vehicle throw which the administration can deliver its change agenda, it stands to reason how the government intends to deliver on its agenda when it cannot successfully pass a simple budget – a customary government practice and procedure!

We urge the National Assembly and the presidency to be conscious of the damage the non signing of the budget is doing to the country, the economy and especially the lives of poor Nigerians. It is time they work with speed and purpose to resolve any lingering dispute and give the people the budget that they deserve.