2020 budget in focus as Reps resume Tuesday

President Muhammadu Buhari presents budget

The 9th assembly of the House of Representatives, since inauguration on June 11, 2019 has through, its Speaker, Hon. Femi Gbajabiamila, repeatedly promised Nigerians lot of reforms. JOSHUA EGBODO takes a look at the 2020 budget as key legislative instruments that would be in focus when the House resumes Tuesday.

History of budget disputes

The national budgeting process has been, for a long time, a subject of disagreement between the legislature and the executive arm of the federal government. Besides, the argument about which of the two has the absolute power over what should be in the budget, there are usually issues of buck-passing occasioned by politicking, and resultant delay in budget passage, ultimately leaving the citizens at the losing end.

In the recent years of democratic governance in Nigeria, the practice was the roll-over of unimplemented allocations, especially the capital component of the budget, leaving such to run alongside the appropriation of the coming year. The practice, no doubt, produces challenges for those interested in tracking budget implementation, including the parliament.

However, with the advent of the current National Assembly, promises of reforms were made, especially in the House of Representatives. The speaker of the House of Representatives, Femi Gbajabiamila, recently gave assurance that the country would return to the January-December budget circle. He vowed there was no going back in achieving that.

Is the executive ready?

By conventional practice, the executive arm of the government is responsible for drawing up the budget estimates, which the National Assembly takes time to review and adjust as it deems fit. In a move that appeared to be in sync with each other at the moment, the presidency has taken steps that suggested a possible early presentation of the 2020 budget estimates on the resumption of the parliament today from its annual recess.

Through the Minister of Finance and National Planning, Zainab Ahmed, the federal government last week disclosed that it would be proposing close to N10 trillion for approval of the National Assembly as aggregate expenditure in the 2020 fiscal year. The budget figure was put at N9.97 trillion.

Speaking at a public consultation forum, where the 2020-2022 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) was discussed, Ahmed disclosed the expected proposal, which represents an increase of about 9.7 percent from the 2019 budget estimates totaling N8.916 trillion, would be on its way to the National Assembly as soon as possible.

Key assumptions

According to the minister, the estimates were predicated on revenue assumption of N7.64 trillion and a fiscal deficit of N2.142 trillion, while crude oil production was assumed at 2.18 million barrel per day at an international projected price of $55 per barrel, against the $60 benchmark used in the 2019 budget. Exchange rate of naira to the US’ dollar is retained at N305.

According to her, inflation rate is projected at about 10.81 percent, with nominal consumption figure of about N122.75 trillion and nominal Gross Domestic Product (GDP) of N142.96 trillion, at a growth rate of 2.93 percent.

Also, debt service is projected to increase from N2.14 trillion in 2019 to about N2.45trillion; and statutory transfer of N526.46 billion, from N502.1 billion in 2019; as well as sinking fund of N296 billion, from N110billion as budgeted in 2019, while recurrent non-debt expenditure was put at N4.57trillion against the N4.39 trillion in the running year appropriation.

Giving assurance on how ready the executive arm was on the 2020 budget, Ahmed disclosed that the Federal Executive Council (FEC) approved the 2020-2022 Medium Term Expenditure Framework and Fiscal Strategy paper.

“The 2020 budget has a debt service estimated at N2.45tn and a sinking fund to retire maturing obligations issued to local contractors and other creditors in the sum of N296 billion. So, there is a total sum of N3.43 trillion that is provided for personnel and pension cost inclusive of N218 billion for the top 19 government-owned enterprises in the country”, she explained.

The challenge of MDAs responding to budget defence

Granted that the promises from the minister painted a very good picture of what Nigerians should expect, it is doubtful to analysts on whether government ministries, departments and agencies (MDAs) were on the same page with her.

Delays in budget passage have been repeatedly blamed on failure of the MDAs to appear before relevant committees of the legislature, to defend their proposed budgets. MDAs demonstrate disdain for the legislature, especially during the immediate past assembly, when leaders of the parliament were not in good terms with the presidency.

How different this time?

It appears, however, that the leadership of the current National Assembly is more disposed to doing the government’s biddings. Also, the speaker of the House of Representatives recently read the riot act to MDAs, that the current house would ensure that government officials respect parliament’s invitations. The speaker said that the 9th house would do everything possible to ensure that government officials respect the invitations of the house.

He lamented a situation, in the past, where officials from different government agencies flagrantly disrespect the invitations of committees of the house.

Speaking when he received the Director-General of the Bureau for Public Service Reforms, Dasuki Ibrahim Arabi, and his management team, during a courtesy call last week, Gbajabiamila said he would personally meet President Muhammadu Buhari on the matter.

Though the expression was not specifically on budget related matters, experience has shown that one of the major subjects of parliamentary invitations is on budget issues. The speaker, who said he was disturbed by attitudes of such agencies, noted; “For me, a situation where the National Assembly summons an institution of government, and they don’t show up doesn’t benefit anybody. This 9th assembly in its legislative agenda will do everything possible to make those things become a situation of the past.

“If this assembly summons whoever, whosoever, I believe they should come. Where do you come in? Since yours is about public service reforms, you should make sure that government agencies respect the invitations of the National Assembly.

“I intend to meet the president on this matter so that it can be addressed once and for all”, he said.

‎The agency’s DG had earlier assured the speaker of the willingness to work with the house, as he explained how the body’s mandate have helped in bringing in several reforms in the public service sector. “We hope we will be able to work with the various committees that you constituted towards the upliftment of public service in Nigeria,” he said.

Smooth sail expected

With the Bureau of Public Service Reforms’ pledge of collaboration, and recent pronouncements by actors in the budgeting processes, as well as the current House of Representatives’ disposition to a new realm of relationship with the executive arm of government, it is in many people’s opinion that the 2020 budget would have a smooth sail.

Also, Gbajabiamila’s promised return to the January-December budget plan, which is the norm around the globe, has been welcomed by experts as the way to go, but succeeding on that is the litmus test the 2020 budget presents before the house as it gets back on regular plenary today. To such pundits, if such could be achieved, it is expected that President Muhammadu Buhari should in coming days, announce a budget presentation day for the parliament to work with.

Meeting the January-December circle 

To analysts, the burden of achieving same still lies with the presidency, which by law, is to present the MTEF/FSP to the National Assembly as prerequisite to laying the budget estimates. Without the approval of the document, the parliament would be acting out of the Fiscal Responsibility Act should it makes attempt to consider any budget for the 2020 fiscal year.

As the house resumes today, therefore, hopes are high that no much time should be wasted in delivering the MTEF/FSP, which after approval would create the way for laying of the 2020 Appropriation Bill. Doing so would make the parliament achieve the return as so far pledged, especially that the Yuletide break would in no distant time beckons.

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