Will Timely Submission, Quick Passage End Cycle of Low Budget Performance?

president’s loan request.

The Buhari government has done a lot of borrowing in the last two years in what it explains to be an effort to execute its infrastructural and economic recovery programmes.The National Bureau of Statistics said last month that Nigeria’s total domestic and foreign debt stocks as at June 30 was about $15.1 billion and N14.1 trillion, respectively.

The total foreign debt profile of the federal and the 36 states governments and the Federal Capital Territory rose from $10.718 billion in 2015, to $11.406 billion in 2016, and $15.047 billion in 2017. The federal government accounts for $11.106 billion (about 74 per cent) of the current total figure of $15.047 billion, while the 36 states of the federation and the FCT owe $3.94 billion, or about 26 per cent.

The federal and state governments’ shares of the debt stock grew from $7.349 billion and $3.369 billion in 2015, to $7.84 billion and $3.568 billion in 2016, and $3.94 billion and $11.106 billion in 2017, respectively.

There have been reservations about the rationality of the government borrowings, especially considering recent increments in the excess revenue (crude) account, with crude oil sales above the budget benchmark price of $44.5 per barrel, as well as rise in tax revenues and other revenue sources.

Need for Effective Strategy The federal government blames the poor implementation of its budgets on revenue shortfalls. But experts say the problem is not so much the lack of funds as sloppy budget formulation.

“A budget is not a public relations statement,” says Professor Pat Utomi, a professor of political economy and former presidential candidate. “A budget is a document that matches resources to targeted goals.

If you say the problem is resources, it means that you didn’t have a budget. A budget must have where the resource is coming from and where it is going to.You cannot project what you are going to do without the resources. You can’t call that a budget, that is a joke.”

To overcome the effect of uncertainty in revenue sources, which is often adduced to explain the poor implementation of government budgets in the country, Utomi recommends the zero-based budgeting method.

Under the current incremental budget approach in the country, the budget is prepared using a previous year’s budget or its actual performance as basis, with incremental amounts added for the new budget. But zero-based budgeting justifies all expenses for each new budget year starting from a zero base.

t analyses every item for its needs and costs and then builds the budget around the needs for the forthcoming year, irrespective of whether the new budget is higher or lower than the previous one.

In September 2015, during a courtesy visit by the Nigerian Economic Summit Group, Vice President Yemi Osinbajo was quoted as saying that the government was planning to adopt the zero-based budgeting format for the 2016 budget to overcome the lapses of incremental budgeting. It is hard to determine how far that intention was pursued.

Related to the zero-budgeting strategy, according to Utomi, is the “repetitive budgeting” method recommended by Naomi Caiden and Aaron Wildadavski in their book, Planning and Budgeting in Poor Countries.

Here, countries are advised to deploy resources to their budgets as they come in, so that periodically, within the budget year, the budget is revised according to the availability of resources.

It does seem Nigeria needs to move away from the current incremental budgeting method to a more effective budgeting strategy that would help to eliminate the recurrent problem of poor budget implementation. Stakeholders Involvement Utomi also advocates involvement of critical stakeholders in the entire budget making process.

“In recent times, there is a team they are putting together to work out of the office of the national planning minister to drive the economic recovery programme implementation. I think that is the way to go,” Utomi says.

“However, ministers need to be educated to give room for their senior special assistants to help in the coordination, monitoring, and mobilisation of stakeholders for the attainment of the goals that have been set.”