Buhari presents 2018 budget estimates today
However, due to the extension of 2016 capital budget implementation to May 5, this year as a result of the late passage of the budget implementation became a huge challenge.
The government intends to roll over about 60 percent of this year’s budget to 2018 in order to align with the JanuaryDecember budget period.
Besides the delay in passing the 2017 budget, there is huge deficit of funding of the capital project as estimated.
A document from the Ministry of Budget and National Planning seen by Daily Trust shows that the 2017 Fiscal Framework projected a quarterly fiscal deficit of 589.19 billion to be financed through earnings from Privatization Proceeds of 2.50 billion, Foreign Borrowing of 266.88 billion, Domestic Borrowing (FGN Bond) of 313.57 billion and Sale of Government Properties of 6.25 billion. However, none of the financing items materialized in the second quarter of 2017.
The sum of 5.08 trillion was projected to fund the Budget, translating to a quarterly share of 1.27 trillion. A total of 506.39 billion, excluding other funding sources, was received in the second quarter of 2017.
This amount was 764.71 billion (or 60.16 percent) lower than the quarterly projection and 126.38 billion (or 33.26 percent) higher than the 380.01 billion reported in the first quarter of 2017.
The aggregate revenue in the second quarter of 2017 was also 123.60 billion (or 32.29 percent) above the 382.79 billion recorded in the second quarter of 2016, the document shows.
The sum of 221.59 billion received in the second quarter of 2017 from oil sources was lower than the quarterly estimate of 530.54 billion by 308.95 billion (or 58.23 percent) for the period. Likewise, all the non-oil revenue items fell below their quarterly budget projections.
A total of 7,441.18 trillion was appropriated for expenditure in the 2017 Budget. Of this amount, 2.99 trillion (or 40.19 percent) was for Recurrent (Non-Debt) Expenditure, 1.84 trillion (or 24.75 percent) was for Debt Services, 434.41 billion (or 5.84 percent) was for Statutory Transfers and 2.17 trillion (or 29.22 percent) was for Capital Expenditure.
Challenge of Separation of budget and finance ministry
The separation of the Budget and Finance ministry by the Buhari administration has been one of the key sources of delay of the budget implementation, sources said.
According to insiders, there is no alignment between the two ministries in terms of releases and coordination of the budget.
The regime didn’t debate the idea thoroughly before separating the budget from the finance. It created a lot of vacuum. By law, the minister of finance is responsible for signing warrants while budget office is responsible for preparing the proposals. At different occasions the releases of the fund are not tied to the needed projects, because the ministry of finance is not in the picture of the projects that urgently need fund at the particular period. So there is lack of proper consultation between the two ministries.
FG to release more fund this month
The federal government will soon release more fund for the capital budget in the next few weeks, a source at the finance ministry said.
The fund will help close the capital vote gap in the 2017 budget before the possible roll over to the 2018 budget the source said.
December target: Passage of 2018 budget not feasible Lawmakers
Lawmakers yesterday ruled out the possibility of passage of the 2018 budget next month as proposed by the executive to kick start the implementation of the January to December fiscal calendar in the country.
President Muhammadu Buhari will this morning present next year’s budget to the joint session of the National Assembly. The early presentation is to kick start the January to December fiscal calendar.
However, the House of Representatives said yesterday it was not possible for the federal legislature to approve the budget between now and December.
House spokesman Abdulrazak Namdas (APC, Adamawa), told Daily Trust on phone last night that the budget process could only be fast-tracked this time around because of its early presentation.
“No, no, no! It’s not possible to do it this year. Budget isn’t something that you’ll rush. Remember it has its own processes that must be followed.
“One, it has to be debated after the president lays it tomorrow (today). From there, it’ll be divided and referred to committees for them to handle their respective areas. The committees will do their work, visit MDAs to ascertain the level of implementation of previous budget, then come back to host the MDAs on budget defence.
“The circle continues up to the time the committees finish their work, do their reports and submit to the appropriation committee. In fact, the committees’ chairmen will defend the various reports before the appropriation committee, before everything will be collated and presented to the whole House for consideration.
“As we speak, we’re yet to approve MTEF, so how do you finish budget this year? It’s not feasible, to be candid. But what I can assure is that we’ll work on the proposal much earlier than the one of this year, because if you look at it, they’re presenting the budget earlier than they did last year.
Asked if it is possible to run subsequent budgets from January to December of each year, Namdas said: “Yes, it’s possible for the National Assembly to be through with subsequent budgets before December. If they (executive) can present it at least three months to the end of the year, it’s very feasible.
“But the issue now is that what is the percentage of the implementation of this year’s budget? Even if you approve the 2018 budget before year end, the one for this year is still running because it’s to be implemented up to next June.”
Also, the Senate Leader Ahmad Lawan last week said that the January to December budget calendar should not be practised at all cost, saying proper implementation is the most important.
Responding to a question on whether the 2018 budget could be passed by December 31, Lawan said: “Well, it depends on how it goes; you know we are supposed to be working on the same page, working for the same people of Nigeria and we will like to see the National Assembly working in tandem with the executive arm of government.
“You know these things will be determined by what the budget looks like, the estimates presented to us because naturally we always try to do a very thorough job, a very patriotic job to ensure that the budget is implementable, to ensure there is equity, fairness and justice in the distribution of projects across the country.
“The 2017 budget took effect from June this year. If it is possible for us to complete the implementation of the budget in six months from June, so be it. But that also requires that we implement the budget properly because these are projects that are supposed to bring development, relief and succour to Nigerians, and if it is not possible we shouldn’t force it on ourselves that we must terminate it.”
Checks by our correspondents revealed that the lawmakers have 21 more legislative days this year as they are likely to proceed on Christmas/ New Year break by December 21st.
Between presentation, passage and assent, the 2016 and 2017 budgets took six months to be completed. The 2016 budget which was presented December 22, 2015 was passed on March 23, 2016 but it was not assented to until on May 6, 2016.
The 2017 budget faced similar delays. It was presented on December 14, 2016, passed in May, 2017 and assented to by the then acting President, Yemi Osinbajo in June.