Nigeria: Economists Say $35 Billion Federal Budget Crafted to Drain Country’s Poor for Greedy ‘Failed State’ Politicians
Several Nigerian economists have questioned the national assembly’s decision to increase the federal government’s budget, saying this move speaks to the lack of accountability that is prevalent among officials in Africa’s most populous nation.
President Muhammadu Buhari’s government had in October presented a budget of N13.08 trillion ($34.1 billion). But the National Assembly increased the President’s budget by 3.9 per cent to N13.58 trillion ($35.4 billion), a move that is according to Development Economist, Dr. Chiwuike Uba likely to heap more misery unto Nigerians.
Insecurity has continued to be a teething problem in Nigeria with suspicions growing that gov't is backing Fulani herdsmen (C) The Tablet
Dr. Uba takes issue with the government’s low investment in capital expenditure. The National Assembly allocated N4.1 trillion ($10.7 billion) to capital expenditure, while the rest of the budget will go to things like debt servicing and recurrent expenditure.
“The recurrent expenditure has continued to increase despite the hardship many Nigerians are subjected to by the government. Almost 50 per cent of Nigeria’s 2021 budget will be spent by less than 0.2 per cent of the population. When subjected to further scrutiny and analysis, the amount for recurrent expenditure may even be more, due to classification issues, or, administrative budget manipulations, or smartly inserted frivolous items as part of capital expenditures,” says Dr. Uba.
Dr. Chiwuike Uba
The Development Economist also picks an issue with the budget that the President sent to the National Assembly, where over N200 billion ($521 million) was allocated to cover frivolous items, items such as the purchase of catering materials, computers, purchase of office buildings among others are still included in the 2021 budget.
He says: “Unfortunately, some of the items classified as capital expenditures do not have any direct impact on the citizens. Economic recovery and resilience cannot happen in such an environment”.
Wasteful expenditure is according to Dr. Uba a lot more painful, when the National Assembly and the government have set a revenue collection target of N8.3 trillion ($21.6 billion).
“The revenue projection of N8.3 trillion ($21.6 billion) is unrealistic given the previous years’ revenue performances. Since 2015, the actual revenue of the federal government has only increased from N3.24 trillion ($8.4 billion) in 2015 to N3.86 trillion ($10.1 billion) as of 2019, representing an increase of less than 20 per cent,” he says.
Sulaiman Hussein, a stockbroker based in Kaduna State agrees with this sentiment, saying the revenue collection target that has been passed by the National Assembly is over ambitious and bound to oppress ordinary citizens instead of helping alleviate the poverty caused by the Covid-19 pandemic that has shocked most nations across the world.
“You can see that the revenue target is not realizable at all. They just want to put a bigger burden on citizens at the expense of their own bad judgment. This government is not serious at all. You can see that the whole thing is close to 50 per cent funding gap,” he says.
Agunloye Bashiru Akinade, a public affairs analyst in Lagos is even more offended by the attitude taken by Nigeria’s political leaders during this budgeting process.
In a year when the world over, leaders have been thinking of how to alleviate the deprivation caused by the Covid-19 pandemic, Mr. Akinade is disappointed that Nigeria’s leaders have chosen the business-as-usual attitude.
He says: “I always laugh whenever a budget has been prepared, sent to the National Assembly for passage and assented by the president. Since the inception of this administration, all the budgets passed have never been implemented to reflect the expectations of the people, most especially the ordinary Nigerians who bear the hardship of most of the policies of the government.
“Every year budget is allocated to education, health, housing, food etc. Is there any improvement in our educational system? Is our health care system improved? Is there affordable housing for the common people in Nigeria? The answer is capital NO. Therefore, the 2021 budget is expected like the previous ones to reflect the expectations and aspirations of the people with power because it is not expected to bring development”.
On the plan by the government to finance the budget from proceeds of the sales of public property, Mr. Akinade says it is another avenue for some people to get rich from the commonwealth.
“This is another way to milk the country. Let me ask, where are the looted funds recovered by this administration? I think if all the looted funds are injected into the Nigerian economy, Nigeria is going to experience huge development. For the government to want to sell national assets is another way for these politicians to loot or sell the assets to their cronies,” he asserts.
The budgetary allocation to defence is another area Mr. Akinade faults the government for, saying that there is nothing to show for previous years' allocations as insecurity has entrenched itself in the society even the more.
“Government officials and the politicians are using the Ministry of Defense for looting. Last year millions of dollars were said to have been spent for procurement of ammunition, but insecurity has dominated most areas in North-East Nigeria. Military High Command has been claiming that it has procured ammunitions but why is the military not been able to stem the insecurity problem? How was the 2020 budget allocated to defence spent? if not spent, then where is the money allocated?”, he asks.
“This Government claimed that it had procured military equipment to face insurgency, yet every week for some months now Boko Haram and Islamic State of West Africa Provinces are terrorizing the North-East Nigeria, killing several innocent Nigerians. Where is the effect of all allocated funds for defence? Nigeria is a failed state in all its ramifications,” Mr. Akinade concludes.