The Federal Government has proposed to spend the sum of N7.298 trillion in the 2017 financial year. At a well attended ceremony by members of the federal executive council and full compliments of the legislature, President Muhammadu Buhari tabled the proposal before a joint sitting of the National Assembly on December 14 last year. Aptly described as budget of recovery and growth, the estimate is projected to navigate the economy out of its current state of recession to a path of steady growth and prosperity. The N7.298trn proposed budget represents a 20.4 per cent increase over the N6.06 trillion of 2016. Some of the assumptions, which underlie the 2017 budget include the benchmark crude oil price of $42.5 per barrel, as opposed to the $38 of 2016, an oil production estimate of 2.2 million barrels per day, same as 2016 and an average exchange rate of N305 to the US dollar as against the N197 in 2016 budget act.
A breakdown of the proposed aggregate expenditure of the 2017 budget shows as follows; capital expenditure N2.24 trillion (representing 30.07 per cent of the budget), non debt recurrent expenditure of N2.98 trillion, sinking fund of N177.46 billion (to retire certain maturing bunds) and statutory transfers of N419.02 billion. The recurrent component of the proposed budget, which account for about 70 per cent of the total estimate comprises mainly payment of salaries and overheads, including N1.8 trillion for personnel costs. The budget is also made up of a deficit of N2.36 trillion, which is about 2.18 per cent of the GDP, which will be financed mainly by borrowing, projected at about N2.32 trillion. Government says it intends to borrow N1.067 trillion or about 46 per cent of the amount from external sources, while N1.254 trillion would be borrowed from the domestic market.
It is good that in the 2017 budget, Government is looking outside of non oil revenues, comprising largely company income tax, Value Added Tax (VAT), customs and excise duties and federation accounts levies, as well as independent revenues and various other recoveries to fund the budget. This is expected to move us away from the traditional dependence on oil as the major source of revenue to fund our national budget. The decision of government to target the rapid development of infrastructure, especially roads, rails and power, including the diversification of the economy through job creation with emphasis on agriculture, manufacturing, solid minerals and services is in order.
Government must also step up its efforts at peaceful settlement with the Niger Delta communities to avoid the recurrence of hostilities in the region with the attendant massive destruction of oil and gas infrastructure, which negatively impacted crude oil production quota last year. We believe that for Government to attain the economic and recovery growth plan, which is the underlying philosophy of the budget, there is the necessity of allowing the private sector to drive the economy, while Government’s role must be limited to facilitating the process through fiscal, monetary and trade policy instruments.
The 2017 budget is in truth, the first wholly-owned budget of the All Progressive Congress (APC) Government and the administration must be held accountable for its failure or success. The APC-led National Assembly must also ensure that it monitors, tracks and oversights the various releases of the budget for proper accountability. There will be no room for excuses or failure. Since coming to power on May 29, 2015, President Buhari had been appealing to Nigerians for patience and endurance to enable his administration fix the country and the economy. Nigerians have suffered enough, sacrificed enough and even endured enough for no fault of theirs order than bad governance. It is our hope that the implementation of the 2017 budget would bring succor and mark an end to our sufferings as promised by the President in his budget speech.
It is our stand that the implementation of the 2017 budget must not be approached by the Government in the usual routine and unserious manner without any measurable impacts and outcomes. So much hullabaloo was made about the 2016 budget and at the year end, not much of its impact and implementation on the citizens can be seen, measured or felt. The purpose of every national budget must be to engender development and alleviate the welfare of the people. If any budget does not meet this basic score, then, it becomes a failure. Unfortunately, as it stands, it is difficult to ascertain the level of implementation of the 2016 budget, not to talk of the impact of it on the lives of the people. This is where we score the legislature very low. In the time past, it was the National Assembly that used to pile pressure on the executive to ensure the implementation of the budget.
As the lawmakers resume from their Christmas and New Year festivities, they must quickly commence due diligence and oversight of the 2017 budget document now before them with a view to passing it into law in record time for early implementation. They must not stop at that, but must also follow through the budget releases and implementation processes to ensure the attainment of the budget’s desired impacts and objectives.