Ime Akpan
BudgIT Foundation said the government of President Bola Tinubu would continue in the borrowing trajectory of its predecessor as the national assembly appears to be a rubber stamp of the executive.
The senior research and policy analysts at BudgIT Foundation, Mr Vahyala Kwaga, stated this at the ‘Budget 2024 conference’ organised by the Finance and Business Online Publishers (FiBOP) in Lagos.
“It is sad to see that the previous national assembly appeared to just rubber stamp a lot of requests for loan facilities by the Buhari administration and with the nature of the relationship that we see between the current senate president and the president of the Federal Republic, that appears to affect the practice of Constitutionally required “checks and balances.” It is likely that it will be business as usual and there will be far more debts incurred in the coming fiscal years.”
He said the onus is on the media and civil society organisation to senitise the citizens to be on their guard.
“If we can, though I do not have very much optimism in that regard, Nigerians can put pressure on their representatives in the national assembly to review these loan requests. Perhaps, there can be some reductions. This is a very complex problem because while we are borrowing too much, we also have to remember that we are actually not spending enough,” he said.
On the current budget, the policy analyst said the government’s N28 trillion budgeted for the 2024 fiscal should have been about N50-N60 trillion if the government was serious.
“So, there is a contradiction; on one hand, we are not spending enough and it is inefficient. On the other hand, we are spending it very poorly. So, there is need for reconciliation on how we spend and how much we even budget for spending”, he said.
Explaining that budgets help government to actually know how much it intends to spend, Kwaga said: “What this should mean to a layman is the road that you use to go from one state to another to sell your shoes, the money that is spent, the cost of goods that you buy in the market, the security or lack of security that you enjoy, among other things are directly going to be impacted by how much the government spends or does not spend on the budget.
“But Nigerians need to understand that budgets are just statements; they are not really worth anything unless the government goes ahead to spend efficiently and effectively.”
While recalling that the federal government had in the past, been releasing reports on how well it had carried out its spending for every quarter in what was called the budget implementation report, he regretted that such reports were either no longer available or the government decided to be silent on it where it is available.
He emphasised that Nigerians have got to a point where they have to take the budget seriously and understand that their livelihoods and future, their existence as human beings depend to a very large extent, on how efficient and effective the government spends its money.
“It is not just even about having a budget, is the money even available?”
“If you recall the issue of deficit, when the government says we want to spend twenty trillion, but we are only going to earn ten trillion, that means there’s ten trillion naira missing. Where is the government going to get that money from? If it is going to get that money through loans, it means that it is Nigerians through their taxes that will pay for that deficit.
“Why is it that it is an average Nigerian citizen that will bear the brunt of those debt payments? These are the things that the budget should show. So, in more ways than one, the budget is very crucial and important and Nigerians only need to take it more seriously going forward,” he stressed.
Kwaga further said it is politics that influences economic decisions, recalling that there was a body called the Joint Planning Board where the federal government and state governments would meet to plan.
He said last time the board met was in 2021, one year after the Covid 19 pandemic.
“So, what is the alignment between what the states are doing with what the federal government is doing? …Businesses in my state want to move their goods from point A to point B, but to a very large extent, the roads that they drive on are federal roads. At that Joint Planning Board meeting, I can table this request to the authorities and say, these are my needs. With the fixing of these roads, business will go up by this amount, companies will pay this amount of tax, VAT will bring in this amount and you see the federal government and the state will then be earning more. But there’s no alignment between the federal government and the states.
“When you look at the issue of energy, the minister of power was saying that the reason the national grid has collapsed is because there’s low gas output. Why is there low gas output? Were they just looking at the gas until it finished? No one raised any alarm that gas is about 70 per cent and so on? People were just folding their hands looking and this has direct impact on the cost of doing business.
“So, if businesses are spending 50-60 per cent of their operating expenses on diesel, there is no way they are going to make money. The government will not even have anything to tax.
“So, you ask yourself, is it government incompetence or is it plain wickedness that prevents them from seeing that they have a direct influence on the very taxes that they want to earn?
