The National Assembly has dashed hopes of an early passage of the 2015 budget as it adjourned till
February 17.
Members, who returned to the two chambers of the
assembly on Wednesday after Christmas and New
Year holidays okayed the second reading of N4.36tn
in their respective chambers but referred further
deliberations on it to their committees on Finance
and Appropriations.
Shortly after giving the task to the committees, the
Deputy Senate President, Ike Ekweremadu, and the
Speaker of the House of Representatives, Aminu
Tambuwal, adjourned.
The action, it was learnt, was to enable members to
go to their respective states to galvanise support for
respective political parties ahead of the February 14
presidential election.
In the House where the action was first taken,
members resolved that their Joint Committee on
Appropriations/Finance should invite the Minister of
Finance, Ngozi Okonjo-Iweala, and the Director-
General of the Budget Office of the Federation, Bright Okogu, for discussion on a realistic oil benchmark for the budget.
The Committee on Appropriations is chaired by a
Peoples Democratic Party lawmaker, John Enoh,
while an All Progressives Congress member,
Abdulmumin Jibrin, heads the Committee on Finance.
They collectively agreed that plummeting oil prices
could only mean a slash in the Federal Government
proposed benchmark of $65 per barrel of crude.
President Goodluck Jonathan officially submitted $65
per barrel as the oil benchmark for the budget on
December 17.
The $65 was a cut down from the $78 he initially
proposed for the budget in the first Medium Term
Expenditure Framework sent to the National
Assembly for 2015-2017.
But, between December 17 and Wednesday, global
oil prices further crashed to around $46, causing
anxiety in oil dependent countries, including Nigeria.
The atmosphere in the chamber on Wednesday was
devoid of the usual tension and rowdiness associated with budget debates in the recent past.
The passage of the budget for second reading
received a unanimous voice vote at the session,
which was presided over by the Speaker, Mr. Aminu
Tambuwal.
House Majority Leader, Mulikat Akande-Adeola, who
led the debate, said the budget had a provision of
N387.1bn for capital expenditure and N2.6tn for
recurrent expenditure.
She added that N411.8bn was budgeted for statutory
transfers and N943bn for debt servicing.
Earlier, members observed that government did not
do enough to diversify the economy.
Abimbola Daramola said, “They should have done a
good homework because annual budgets should not
be omnibus replication of previous ones.”
Two other lawmakers, Joseph Kigbu and Ndudi
Elumelu, suggested that the capital expenditure
should have been further slashed since government
might not be able to raise adequate money to fund
projects in 2015.
A member from Borno State, Mr. Mohammed
Monguno, could not agree less, saying, “The Federal
Government has been professing the diversification
of the economy but this is not reflected in the
appropriation.
“With the discovery of shale oil and the falling price
of crude oil, there is a need to diversify the
economy.”
Tambuwal clarified that while the plenary stood
adjourned, various House committees would call
meetings with Ministries, Departments and Agencies
of government for defence of their budget proposals.
Before the Senate also adjourned, members
lamented gross fiscal indiscipline by MDAs and
vowed to carry out necessary legislative activities to
check them in the current fiscal year.
They also noted, among others, the sharing of
billions of dollars in the Excess Crude Account
without the authorisation of the National Assembly
and the illegal spending of revenues generated by the MDAs as some of the Executive excesses that must be curtailed.
The senators therefore resolved to ensure that all
revenues accruable to the federal agencies were
captured and appropriated by the National Assembly.
The Chairman, Senate Committee on Finance,
Senator Ahmed Makarfi, in his contribution, stressed the need for caution in the treatment of the budget since no appropriation could be done without first determining allocations to various sectors.
He said, “The budget cannot be looked at in a hurry.
This is an austerity period. Money should be
generated. We also need to cut down on cost of
governance by blocking leakages.
“We need to review the earnings and spending of the MDAs while taking into cognisance, the fact that the exchange rate of N165 to a dollar and the oil
benchmark of $65 per barrel, are no longer realistic.”
Senator Abdul Ningi,who described the 2015
appropriation bill as a budget of caution told his
colleagues that the vote for capital expenditure was
less than 10 per cent.
Decrying the lack of information on the
implementation of the 2014 budget, Ningi suggested
the continued implementation of the 2014 budget till
March 2015.
He also asked his colleagues to caution the
appropriation committee against tinkering with the
proposals of the MDAs which had been worked on by relevant Senate committees.
Senator Ayogu Eze suggested the expansion of the
revenue base of the economy by putting it on a solid
footing.
He also suggested the revisiting of the National
Development Plans but faulted the allocation of
N2.3tn to recurrent expenditure and N387bn for
capital projects.
Senator Issa Galaudu noted that there had been
excesses in the nation’s oil revenue since 2011 and
wondered where the Executive put the funds in the
excess crude account.
Also, Senator Olubunmi Adetunmbi expressed fears
that the country might not be able to fund the budget since “the estimates which are based on $65 per barrel are now unrealistic.”
He added, “I don’t know the empirical bases upon
which the projections were made in terms of oil
production and revenue. It is a deficit budget
because there won’t be any money to fund capital
projects or the recurrent expenditure.
“The budget is unrealistic. We should allow the
Federal Government to review the oil revenue
projection and benchmark based on the reality on
the ground.”
Another lawmaker, Ita Enang, said there was no point allowing the Central Bank of Nigeria, the maritime agency and the National Communications
Commission to generate and spend money without
transferring it to the Federation Account.
He said, “I am celebrating the fall of oil so that we can go back and see the amount generated by these
agencies. This will enable us to determine the 20 per
cent they should spend and the 80 per cent they
should transmit to the Federation Account.
“How do countries that do not produce oil survive? It
is through money they generate internally. Where is
the ECA? The benchmark was $73 per barrel but oil
sold for over $100 per barrel. Where is the excess
crude share of the Federal Government?
“We are guilty because I had advised that no money
from the ECA should be expended without the
consent of the National Assembly. My submission is
that since we signed the 2014 Appropriation Act,
there has not been application for supplementary
budget.
“The President should therefore fund the 2015
budget with the reserve in the ECA. The prices of
petroleum products should be reviewed downward
so that labour unions would not go on strike over the issue.”
Senator Victor Lar also said that the 2015 budget
estimates were unrealistic because they lacked a
basic scientific approach.
He said, “The recurrent expenditure is bloated. Any
oil benchmark outside of $30 to $35 is unrealistic.
The budget must be further cut down by 100 per
cent. Revenue from other sources can fund the
budget. Various public officers must make sacrifices
by cutting cost of governance.”
Ekweremadu, who presided over the session, said
the National Assembly would lead the fight against
fiscal indiscipline.
He said, “I do believe that this is the time for us as
Parliamentarians to ensure that while considering
the 2015 appropriation bill , all the revenue items are captured. Our Committee on Finance will help us to do that.
“We need to ensure that all the revenue items are
captured in the budget and determine a pool of
resources to implement the budget when passed.
“The Federal Government should also put on a
thinking cap to be able to develop new areas of
revenue generation that would help us to drive our
economy. We have gone through this way before but
eventually the oil price improved but unfortunately
we did not learn any lesson while we enjoyed the oil
boom.
“I hope that this period, we will learn a lesson that
will help us to be disciplined in our fiscal
management. It is also time for us to think seriously
about our fiscal federalism so that states can adopt
initiatives for increasing their revenue bases.
“For us as politicians, we have to be mindful of our
election expenses and we need to do things within
the provisions of the Electoral Act.
“If anybody thinks that he will spend money and
would recover them after election,he will be
disappointed because there would be no money to
recover.
“A country like Norway also produces oil but at no
time had they predicated their budget on oil revenue.
They save all the money for the future. We can also
do the same thing by managing this time.
“It may be that God has designed it this way for us in
order to make progress in terms of fiscal discipline.
The National Assembly is taking this seriously based
on our comments this afternoon and we are
prepared to also lead the fight to enthrone fiscal
discipline in Nigeria.”
After the contributions and transfer of further
deliberations on the bill to the Committee on Finance and Appropriations, Ekweremadu adjourned further sitting till February 17.
Like Tambuwal, he gave no reason for the
adjournment but a senator told one of our
correspondents that it was to enable them to go back to their respective states to mobilise support for their parties for the February 14 presidential poll.
The senator, who did not want his name in print,
said, “What happened today (Wednesday) is tactical.
It means the passage of the budget can only be
possible after the presidential election . On the
surface, it was to enable members to work for their
respective parties ahead of the next month’s
presidential poll. But the core reason is to enable us
to wait and see in whose direction the victory
pendulum would swing to.
If the President with his party wins, much changes
will not be made to the bill. They will always be a way to make the budget work. But if the opposition
emerges victorious, you know the budget proposals
may become a tissue paper.”