2014 budget: Issues beyond lateness

While it may be admitted that the expectations  that are shaping the government’s financial outlook for the nation’s economy in 2014, have enjoyed some of the most rigorous analytic processes, not a few observers believe that hardly has the complete picture been captured in the exercise. A pointer to this remains the run of public […]

While it may be admitted that the expectations  that are shaping the government’s financial outlook for the nation’s economy in 2014, have enjoyed some of the most rigorous analytic processes, not a few observers believe that hardly has the complete picture been captured in the exercise. A pointer to this remains the run of public misgivings over the twice aborted presentation of the budget to the National Assembly by President Goodluck Jonathan. And that is why a caveat remains justified.
It is easily recalled that on each of the two aborted occasions when the President was to present the proposals of the  budget to the National Assembly,  Nigerians generally had greeted the dispensations with animated anticipation, given the locomotive effect which  government funding traditionally has on the nation’s economy. The effect of the abortion of each of such proposed presentations on the nation’s business community and the rest of us cannot be over emphasized. However, when it was posited that the back-to-back abortions of the exercise were due to the non-passage by the National Assembly, of the statutorily preceding MTEF, and FSP,   the long suffering Nigerians seemingly granted the President a reprieve.
In any case, given that the budget passage exercise in the National Assembly takes an average of five months, and the fact that the same legislature, along with not a few Nigerians had stringently lamented the perennial lateness of the nation’s budget, it was hoped the 2014 budget estimates would set a new mark by coming up early enough, at least not later than October 2013.  But that was not to be.
Indeed, even if the budget is presented to the National Assembly any time in the remaining part of 2013, only a divine, miraculous dispensation can give the nation a federal budget earlier than the end of May 2014. After all hardly will the legislature turn itself into a rubber stamp facility even if it is for the purpose of fast tracking the budget.
And with the stimulus of the budget requiring a minimum of three months to impact the nation’s economy, it is easy to see that August 2014 remains the threshold for the dawn of derivable of 2014 budget for the economy. This would leave only four months left to implement it. That means in unmistakable terms, another failed budget and the traditional explanations over why it failed.
Incidentally, if lateness were the only failure factor facing 2014 budget, the situation would be simpler.  Rather there exists a complement of maladies comprising ambiguities, contradictions and outright paradoxes that feature in the MTEF as well as the FSP, and which qualify for more than a casual attention and hopefully, the scrutiny of the National Assembly during its passage through the portals of that institution.
As had been mentioned earlier,  it cannot be denied that the build-up to and the actual provisions  of 2014 budget are products of painstaking effort by the Budget Office, given the avalanche of details with respect to it, and which is availed the public space. However, given that even past budget exercises which enjoyed similar treatment of painstaking  attention, still recorded abysmal levels of failure in implementation, what guarantee can Nigerians have that the 2014 budget will proceed beyond the point where others before it failed?
This question, mundane as it may seem to some observers, constitutes the kernel of a raging debate among observers in the public and private sectors as well as among international stake holders in the Nigerian economy.  To accentuate  the wide spread concern over next year’s budget is the difficulty which none other than  the Minister of Finance and Co-ordinating Minister for the economy, Dr Ngozi Okonjo-Iweala demonstrated at assuaging fears over  it, at the recently concluded Nigerian Economic Summit in Lagos. It was  not for nothing that she went to great lengths to coat the forthcoming bitter pill of tight fiscal policy and depressed economic fortunes with  what an observer called “sweet talk”.  For instance, while she rightly noted that virtually all economic indices on the country were authenticated by the International Monetary Fund (IMF) as “positive”, the MTEF document from her office admits that the nation could not have survived in 2013 without significant draw-down on the Excess Crude Account (ECA).   According to official statistics the ECA which rose from $4.22 billion in August 2011 to about $9 billion at the end of 2012, shrunk to about $5 billion in June 2013. That was a drastic drop of $4 billion or 44% in just six months.
If within a short period of six months, as much as 44% of the ECA can be drawn down for whatever reason, what happens in the face of further economic crunch as is likely in the coming year? Granted that the ECA was set up ab initio to serve as buffer in the face of financial hiccups, would the rapid draw-down of 2013 not qualify as scooping with a shovel what was gathered with the rake?
It is significant that the MTEF clarifies that the transformation objectives of the nation’s fiscal regime are anchored on four main pillars namely macro-economic stability, structural reforms, governance and institutions as well as investment in priority areas. Without conjecture, it is clear that of the four pillars, that of institutions and governance takes precedence. Given that government’s statutory intervention in the economy can only be applied through public institutions, the quality of service delivery from and by them remains pivotal to the success of whatever strategy government adopts to get its job done.
In this context it is easy to see a link between the growing spate of institutional incontinences, with some assuming catastrophic proportions, even in the face of lament by the government over dwindling revenue to finance its approved projects and programmes.  Of particular significance  is the recent alarm raised by the Central Bank of Nigeria (CBN), over non- remittance to it, of  funds totalling over N8 trillion being for the period January 2012 to July 2013, by the nation’s ‘cash cow’, the Nigerian National Petroleum Corporation (NNPC), and as stipulated by law.
While the two agencies are still haggling over protocols associated with the dispensation for remitting the nation’s monies to proper destinations as well as who does or gets what, Nigerians are hardly bemused over the implications of the drama. The obvious worry is that if such indiscretion can be associated with formal and regular collaboration between the CBN and the NNPC, what would be the situation in other less visible areas of national life?
It is interesting that the Senate has launched a probe into the matter. It remains to be seen how far this would go, given the history of probes of the nation’s oil industry, and in particular the traditional challenges associated with transparency in the finances of the NNPC.
The foregoing notwithstanding, it is crystal clear that beyond its lateness, unless aspects of it are revisited, the 2014 national budget may eventually reach Nigerians with more questions than answers.
 That is whenever it comes.

Daminabo, a former director in the National Assembly, is a member of the Editorial Board of Daily Trust.