Although the National Assembly passed the 2018 budget yesterday, May 17, 2018, six months after President Muhammadu Buhari presented the document to the National Assembly, the delay in the passage of the Appropriation Bill will, no doubt, have dire consequences on the nation’s economy.
The Minister of Finance, Mrs Kemi Adeosun, said in Abuja on Friday that the delay in passing the 2018 budget would cause some adjustments in implementation which would have some impact on the nation. Adeosun, who said the impact was due to changes in the market and in the cost (value) of money, however, assured that the federal government would try to mitigate the effects of the delay. Adeosun said: “Honestly, we may need to realign some of the priorities now because what we thought we would be doing in January is now different from what we are going to do
So, we are going to have to look very closely to see where we would realign and re-prioritise, but we will carry on because most of the capital projects are multi-year projects, so we will just continue.
“We are going to try and mitigate that impact as much as possible and focus on completing projects,” she said, adding that the fact that the 2017 budget cycle began late in the year had helped a great deal. What has helped us is the fact that the budget was passed late last year, and what we did was (that) we just carried on with those projects. We will close this year’s budget with capital expenses in excess of N1.5 trillion, which is higher than last year.
Many of these projects are multi-year projects, so, hopefully, there will not be too much disruptions.’’ Adeosun noted that the financial systems were not closed on December 31, 2017 in order to allow for projects implementation to continue.
The National Assembly, which had earlier promised to pass the 2018 national budget on April 24, later shifted the date to May.
According to reports, the date was postponed as the legislature said some ministries were yet to defend their budget proposals. This is not surprising because the delay in the passage of the budget has almost become a norm in Nigeria. In 2016, the National Assembly passed the budget in March.
However, padding allegations by the President delayed the final sign off till May 6. In 2017, the Senate alleged that the Nigeria Police had taken 18 files needed to fully assess the budget. In the end, the National Asembly passed the N7.4trn budget on May 11, and the then Acting President, Yemi Osinbajo, signed it into law on June 12. Every year since 2014, the national budget has been passed and signed into law around May/June.
Blueprint is particularly miffed by the fact that despite the unusually early presentation of the 2018 budget to the Joint Session of the National Assembly on November 7, 2017 by President Buhari, the lawmakers refused and/or neglected to work on the document but instead resorted to use it as bait to blackmail or arm-twist the executive on several mundane issues.
Chief among the issues raised by the legislators are refusal of chief executives of some ministries to defend the budget estimates contained in their proposals, the recent invasion of the Senate, “abduction” of the Senate mace, mishandling Senator Dino Melaye by the police, and refusal of the Inspector General of the Police to honour Senate summonses.
Notwithstanding the claims by the legislature over the 2018 budget delay, we are of the view that the National Assembly ought to have applied the principle of utmost national importance in dealing with the Appropriation Bill.
This is borne out of the fact that passing the budget deep into the year postpones the multiplier effect of government spending. While recurrent expenditure boosts injections, capital spending reduces the country’s infrastructure deficit. The latter will also support activity in the construction sector, which grew by 1% in 2017.
In order to resolve the seemingly intractable delay in the passage of the Appropriation Bill as well as its signing into law, due to alleged padding by legislators, we call for the setting up of a Budget Office at the National Assembly to harmonise budget themes, details, and figures with the executive branch year-round.
This will go a long way to reduce the timeframe used in the trade-off on the budget between the two relevant arms of government, which is likely to further push the signing of this year’s budget into law to an unprecedented June/JulyNo tags for this post.