2023 elections and the Fiscal Responsibility Act
As Nigeria prepares for the 2023 general elections, the tendency for responsible agents of government to shift focus from governance to politics is a possibility. Currently, the political tempo of who becomes the next president and the process of selecting the candidates have taken over the discourse. Little attention is being paid to the implementation […]
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As Nigeria prepares for the 2023 general elections, the tendency for responsible agents of government to shift focus from governance to politics is a possibility. Currently, the political tempo of who becomes the next president and the process of selecting the candidates have taken over the discourse. Little attention is being paid to the implementation of the 2022 budget and the state of the economy.
From the guideline of INEC, the parties have up till the second quarter of the year to conclude the process of selecting their respective candidates. Thereafter, parties are expected to commence high politicking, including amassing of funds for campaign activities.
Historically, pre-election years have been mismanaged by presiding governments to the point of affecting governance and service delivery. During this period, provisions of the Fiscal Responsibility Act are also prone to violation. The Fiscal Responsibility Act, which sets the pace for prudent management of the nation’s resources, ensure long term macro-economic stability of the national economy, secure greater accountability and transparency in fiscal operations within the Medium Term Fiscal Policy Framework, and the establishment of the Fiscal Responsibility Commission to ensure the promotion and enforcement of the nation’s economic objectives; and for related matters can be subject to abuse. For instance, there are usual delays in the implementation of the budget during this period.
The budget was signed by the president early January 2022, the early signing should have been a good reason to attain the macro-economic targets set for the first quarter implementation of the budget. The Fiscal Responsibility Act, in S. 30 provides that the Minister of Finance, through the Budget Office of the Federation, monitors and evaluates the implementation of the annual budget, assesses the attainment of fiscal targets and reports thereon on a quarterly basis to the Fiscal Responsibility Council and the Joint Finance Committee of the national Assembly.
Sub section (2) also states that the Minister of Finance shall, cause the report prepared pursuant to subsection (1) of this section to be published in the mass and electronic media and on the Ministry of Finance’s website, not later than 30 days after the end of each quarter. However, as at the time of writing this article, there is no evidence from the website of the budget office or ministry of finance on the budget implementation.
The BoF does not have a budget implementation report for the last quarter of 2021 and the first quarter of 2022. This could imply a possible delay in budget performance for the last two quarters. Another disruption that might be occasioned by electioneering activities is the late preparation of the Medium Term Expenditure Framework and the passage of the 2023 budget. S. 14 of the FRA provides the time limit for presentation of Medium Term Expenditure Framework to Federal Executive Council, S.14 (1) states that; The Minister shall before the end of the second quarter of each financial year, present the Medium-Term Expenditure Framework to the Federal Executive Council for consideration and endorsement. (2) The Medium-term Expenditure Framework as endorsed by the Federal Executive Council shall take effect upon approval by a resolution of each of the National Assembly. From the provision, the timeline for the preparation of the MTEF is June, this is also the period parties are expected to conclude and submit names of their presidential candidates to INEC. With the refusal of current serving ministers vying for political offices to resign their positions to avoid interference with their duties, the MTEF might experience delay or may not receive qualitative input from the affected ministries.
On borrowing, the federal government plans to borrow to finance the N6.258 trillion 2022 budget deficit. The FRA makes it mandatory for borrowing to be utilised only for capital projects, but with the spate of political activities ongoing and little attention to governance, borrowed sums might be diverted for political purposes thereby increasing the inflation figure which is already at 15 per cent. In the same vein, it has been previously observed that most MDAs channel their unspent funds to the campaign activities of their preferred political parties and candidates. This is in violation of the Fiscal Responsibility Act which mandates the MDAs to return such funds to the Consolidated Revenue Fund. Also most members of the legislature, who are meant to play an oversight role on the implementation of the budget, are also gearing up to return to the legislative chambers and may not dedicate time for such an important role.
Thus, the Fiscal Responsibility Commission takes note of the red flags highlighted and works with necessary agencies of government to forestall the violations of the Act. The Fiscal Responsibility Commission should scrutinise the financial inflows and activities of government owned enterprises to ensure that they do not divert the remittances of their operating surpluses to the CRF for political activities. The exercise of the powers and functions of the Fiscal Responsibility Commission is mostly required at this stage so as to protect the interest of the masses and avert the possibility of economic sabotage in the wake of elections.
By Victor Emejuiwe wrote from Abuja