My thoughts on the 2011 appropriation bill

My thoughts on the 2011 appropriation bill, tagged: budget of fiscal consolidation, economic growth and employment generation.

You know our people will benefit more with the implementation of the capital budget, and we cannot move forward while we spend the larger part of the budget on recurrent………senator Mamora(deputy minority leader)

The President of Nigeria Dr. Ebele Goodluck Jonathan has presented a budget of 4.22trn to a joint session of the national assembly for debate and approval. Not to sound radical I would categorically say that the president was advised wrongly(not that am saying I no more than them) to have budgeted a whooping sum of 2.48trn naira for recurrent expenditure, to me it is totally unacceptable , in a country that we are in dire need of infrastructures(new roads, Niger delta issue, over head bridges, electricity, hospitals, universities etc), now allocating over 60% of your budget for salaries and allowances is unacceptable. Yes I know you have to pay workers salaries, (ASUU and all other SUs would sill start asking for increase in salary especially as this is an election year), and you have to enter for a first term, but the fact that the way the allowance is structured in this part of the world where just about 500(senators, house of reps) people would take half of that money is the risk Nigerians are not willing to take.

A country where experts for instance have advised that if we are going to achieve the 20:20:20 vision we need to spend 15trn on housing alone(capital expenditure), on his delivery he promised to provide jobs for Nigerians, if you spend more on capital expenditure like building more schools, more power stations. Wont that create more jobs? Instead of wanting to blow money on salaries when senators and alike would take 50% of it.

The recent issue of six universities intended to be created by the federal government one each for the six geopolitical zone, is it out of this 1.005trn(budget for capital expenditure) that Goodluck expects to build it from, what about the issue of 4 nuclear power plants for power generation, the renovation of the Lagos-Ibadan death trap, all other unfinished capital projects, and new ones..basically what Goodluck is telling us is this is an election budget!!!

Another pertinent issue with the budget is a fact that president in the name of winning election, (by blowing off money) intends in his budget ceteris paribus that Nigeria would have a revenue of 2.8trn(oil bench mark @$ per barrel) leaving a huge deficit of 4.22trn-2.8trn 1.42trn(higher than what he planned for capital projects self). How does he intends Nigeria to finance the huge deficit by the year 2012 and beyond regardless of who becomes president….best case scenario is that he increases tax, or best form as best practiced by former president Olusegun Obasanjo is to increase fuel price, and the ordinary Nigerian would still be the one to bear the brunt, not the senators, ministers and  the too much special advisers who collected this money(recurrent expenditure) but the still unemployed/underemployed Nigerian, who as a lack of creation of jobs viz a viz the presidents failure to spend on capital projects would be the one to pay for the hike to cover the deficit.

In summary, this budget as against how President Goodluck described it as “budget of fiscal consolidation…..economic growth and employment generation” it should be called budget of winning an election. Apart from the fact that Mr. President has made a technical error, by calling a budget you intend to be hugely deficit,- fiscal consolidation, I pray there is a meaningful economic growth. People should not here that the fact that last year budget was around 5.1trn…..doesn’t necessary make a budget of 4.22bn consolidation.

My humble way forward

As we all know, the ball is now in the legislative, if “possible” they should review the salaries they are earning,  so that if the money remains, we can still be hopeful on the deficit side.

But more importantly is the implementation of the budget, I once said if just  1billion naira was spent to the last kobo on any sector of the economy, ordinary Nigerians would feel it. If the senate through her committee monitors this budget implementation to the letter, bearing in mind that the political situation(elective and appointed posts) of the country would change in May, hence any ministry presenting her budget now, should only be given money for 2 quarters.