Trust Nigerians, they have since been voicing out their concerns not just on the size of President Muhammadu Buhari Budget 2016 but also the contents of the fiscal instrument expected to signpost change. Yes, not a few, have been mystified by its expansionary outlay in a period of vastly declining national revenues. With oil prices showing no signs of imminent rebound, and in the unlikelihood of revenues from non-oil sources making up for the gap in the near time, and now with debt –re-emerging as a principal factor in our public finance matrix –naturally, there ought to be a lot to talk. After all, it is barely a decade after our celebrated exit from the debtor cartel of London and Paris Clubs –subsequent to which we are supposed to suffer the debt allergy.
To suggest that the issues are being properly framed is however a different matter. I do not want to delve into PDP’s characterisation of the N6.8 trillion budget as “a big fraud and executive conspiracy tailored towards mortgaging the future of the nation”. If Nigerians are any bemused by the PDP’s rant especially its verbose dismissal of the budget as “completely unrealistic and duplicitously embellished with impractical predication”, I’ll say that they ought to have better things to do than listen to the tutorials from a party that was midwife to the most profligate administration ever to known to man! Recall that under PDP’s disastrous rule, total earnings not only exceeded those of previous administration combined, yet the party left the country faring worse under all known indices of human development!
And so I speak of well-founded concerns that have been expressed in some quarters about the budget. I start with the rather ambitious revenue projection of N3.86 trillion in a year the federal government plans to spend N6.08 trillion – hence a N2.2 trillion deficit. Much as the idea of a deficit is not necessarily a bad one– no matter that it is a mere 2.16 percent of the debt-GDP ratio – the option of borrowing to fix the gap says pretty little about our experience of fiscal rectitude –or lack thereof. Are we not living witnesses to huge loans contracted on humongous terms which in the end delivered pretty little by way of value? As if the assumption that the managers of the economy have learnt their lessons from past experience of debt management is not dangerous enough, the administration appears to have glossed over capacity issues that have dogged every cycle of budget implementation.
In any case, the key assumptions of the budget must be seen as troubling enough. At a time a record number of our crude vessels are said to be stranded at sea looking for buyers, the Buhari administration obviously did not think it a bad idea to count the chicks before they are hatched. If you ask me – again I’ll say that the administration’s bet on pumping 2.2 million barrels of crude daily is hardly the way to wean the country off its addiction to oil! As for the $38 a barrel benchmark – another key assumption – is it a case of the administration’s hierarchs knowing something about the dynamics of oil price that Nigerians, nay the rest of the world do not know at this time?
Agreed, the options for getting the country out of the cul-de-sac are somewhat very limited at this time. Were the nation’s infrastructural gaps not as wide as we currently have; or the institutions not so broken to such an extent that any talk of putting a foundation for economic recovery on it seems domed ab initio; and the unemployment situation so grave as to constitute a national security issue, we’d probably have enough time to debate on the niceties of massive public expenditure cuts or some modest efforts to align expenditure with revenue – which for all practical purposes seems at the moment the surest route to nowhere. It’s probably one luxury we cannot afford given the dire emergency.
So, I do not think the option is for the country to do nothing as the wailers appear to suggest. In fact, I am willing to endorse the general principles behind the budget in so far as it recognises that some bold, expansionary measures (which the government seems best placed to put in place particularly at this time) are needed to give fillip to the economy. The implementation of the conditional cash transfer of N5,000 to the under-class – a novelty – promises to be interesting just as the school feeding programme is potentially revolutionary. I will aver in the same breathe that the 30 percent planned spend on capital projects, though rather modest, is a positive move given that the need for the realignment of the capital-recurrent component goes to the heart of our budget problem. Although it is still early in the day to make definitive affirmations on outcomes, the mere fact that successive PDP administrations found it impossible to move in any concrete way in that direction for the whole of 16 years obviously makes it a plus for the Buhari administration.
Still, there are many things wrong with the so-called ‘budget of change’. It is broadly, as far as I can see, more of the same. The quest to prune the cost of running the bureaucracy remains largely, unconquerable. Our bureaucratic cart continues to drive (or if you like – drag), the development horse. President Buhari’s wish is therefore one thing; our smart Alec bureaucrats and their allies in the political establishment will almost inevitably have their ways. Talk of assortment of projects with dubious economic utility; a budget stuffed with pork and earmarks – there you have them in plenitude in the budget of change.
Samples. I look at the huge votes for choice toys for officials – the billions to be spent on exotic cars – by both the executive and the legislature; I cannot but wonder if these are meant for tourists or wayfarers as opposed to public servants. I understand why shelling out huge sums in foreign exchange to procure the fancy toys would keep our big men happy; however, for an administration that promises to do things differently, we expected things to at least reflect current moods. It’s hard to imagine that this is happening at a time Godwin Emefiele and company at the apex bank have taken on the drastic measure of clamping down on petty users of foreign exchange like our students abroad; a time when traders in the 41-odd items precluded from access to foreign exchange have become overnight economic refugees. I thought that our lordships would, if only for the sake of symbolism, reflect upon their lust for the exotica and show solidarity with the rest of us for once! The same goes for the residences proposed for the trio of Vice President, Senate President and Speaker, House of Representatives at a princely cost of N5 billion. At this time – and from funds known to be largely borrowed? To the extent that no one has yet told us that these gentlemen sleep in the streets of Abuja, some of those capital projections surely, can wait!
Happy New Year to you all!