Addressing Citizenry Extensive Concerns on the 2017 Budget Proposal

Addressing Citizenry Extensive Concerns on the 2017 Budget Proposal

On 23 February 2017, the Director-General (DG) of the Budget Office of the Federation choreographed a media briefing on several issues surrounding the 2017 Budget Proposal. The DG also used the briefing to make certain clarifications on public outcries over several budget items on the proposal. Most of these outcries were on many frivolous items (especially on electricity and utility bills of MDAs; several humongous expenses on the state house budget on utensils and feeding, electricity bills, travel expenses etc.); repetitions of budget items; budget cycle crisis; the budget preparation expenses; lack of details on some of the items; budget padding etc.

In attendance at the briefing were the media and Civil Society Organizations (CSO). In responding to some of these concerns, the DG took his time to counter some of the claims:

1). He stated that there was no sort of budget padding on the 2017 budget proposal.

2). That there were no frivolous items. That most of the extensive increments such as state house proposed expenditure on utensils and utility bills; electricity bills, security and cleaning services payments in MDAs etc. were either as a result of arrears of such bills/expenses or because funds were not later provided for them on the 2016 budget (meaning they were not implemented.)

3). He stated that there were no repetitions on the proposal, unless the repetitions being referred to were budget items on the 2016 one that re-reflected on the 2017 proposal, which was as a result of the fact that funds were not provided for such items on the former.

4). He reassured the audience of his liaison with the National Assembly to ensure that budget cycle would be from January – December of every year, which was clearly stated on the constitution, as against the culture of having a previous budget being implemented in another fiscal year.

5). He also explained that the details-deficit on some of the budget items were as a result of the perspective to keep the budget simple, for public consumption. That however that his agency would ensure further details on budget items when preparing subsequent budgets.

Representing Connected Development (CODE) at the event, I further engaged the DG and raised concerns over the NGN305/$ calculation on the budget proposal (while $1 is valued at NGN 520 at the contemporaneous market); if there are extensive plans for enhanced transparency and accountability in the 2017 budget implementation; our expectancy to lay hands on the 3rd and 4th quarters’ reports of 2016 budget implementation; his plans to ensure that revenue realization deficit would not frustrate the 2017 budget implementation drawing on the country’s experience with the 2016 one; and getting access to an extensive version of the budget that had further details on some of the line items. For the latter, I mentioned the ‘Talking Sanitation’, as well as ‘Afforestation’ and ‘Tree Planting’ budget items on the proposal, under the Ministry of Environment, which all lacked details such as where and how. Lack of such specific details has frustrated the works of CSOs that are into governmental capital expenditure tracking.

In addressing my concerns, the DG made commitments that were all in line with Nigeria’s commitments on the Open Government Partnership. He stated that the 3rd quarter 2016 budget implementation report would soon be in public domain while the 4th quarter’s would soon be out too. He further stated that there would be increased transparency, accountability and citizen engagement in the 2017 budget implementation. On this, he cited plans to have a digital platform for 24/7 citizen engagement on the budget. He also mentioned that there would be a breakdown on project basis subsequently when funds are released to MDAs. In addition, he promised a quarterly media briefing on the 2017 budget implementation. These were all good news and great outcomes for nonprofits that are into Open Governance advocacy. He mentioned categorically that the revenue realization plan on the proposal is quite realizable and that the FOREX regime crisis would not affect the budget implementation.

This media engagement is a step in the right direction as bringing all stakeholders involved and addressing public concerns on the budget proposal have boosted citizen participation in governance and also provided a platform for clarifications on several portions of the budget, as well as for stakeholders to make suggestions. It is hoped that the Director keeps to all the new commitments he made at the briefing and ensuring extensive open financial governance in the budget implementation. From our part, we are sending an FOI request for an extensive version of the budget, which he promised CODE would be provided with. And before I forget, he commented that he likes our name, ‘Follow The Money.’

 

Chambers Umezulike is a Program Officer at Connected Development and a Development Expert. He spends most of his time writing and choreographing researches on good and economic governance. He tweets via @Prof_Umezulike.

A Reflection on the Legacies of Murtala Muhammed

A Reflection on the Legacies of Murtala Muhammed

General Murtala Muhammed ruled Nigeria from 1975 until his assassination in 1976. In a short time, his policies, pro-activeness and decisiveness won him broad popular support. He swiftly initiated a comprehensive review of the 3rd National Development Plan and created economic strategies to address rising inflation rate. He also immediately announced that his government would encourage the privatisation of government corporations. To fight corruption and over-bloating of the civil service that was legitimised by the Gowon government, he also dismissed more than 10,000 public officials and employees without benefits, on account of age, health, incompetence, or malpractice.

To some, this later became the single biggest policy error in the development of Nigeria by damaging the public service both in capacity and through encouraging corruption. This was because, the dismissals brought public servants to the reality that security of tenure was something that could be swept away with a stroke of the pen. Consequently, since one does not know how long a public service might last, it was considered better to feather the nest while one had the opportunity. In addition, the mass sack had an adverse effect on socio-economic development because Nigeria lost skilled and trained manpower that would have strengthened its institutions.

While his critics leverage on this and his role in the civil war in criticizing him; his admirers focus on his personality, decisiveness and the sort of populist actions in took while in few months in office, as part of his legacies. In the midst of such mixed reactions over his legacies, the Murtala Muhammed Foundation (MMF), on 13 February 2017, organized the 2017 Murtala Muhammed Memorial Lecture, with the theme, ‘Humanitarian Crisis and Response in a Plural Society: What Role for Leadership,’ at Shehu Yarádua Centre, Abuja.

In attendance were the acting president, Prof Yemi Osinbajo; former president, Chief Olusegun Obasanjo; Cardinal John Onaiyekan; Board Members of MMF; Mrs Ajoke Muhammed, widow of Murtala; and HE Kashim Shettima, governor of Borno State; as well as other dignitaries and participants. The acting and former presidents all gave their remarks, highlighting the ideals of Murtala Muhammed. The governor was the keynote speaker, in a lecture titled, ‘Managing the Boko Haram Crisis in Borno State; Experiences and Lessons for a multi-party, multi-ethnic and multi-religious Nigeria.” In the lecture, Mr Shettima took his time to narrate the emergence of Boko Haram which he married with the incompetence of his predecessor, Ali Modu Sheriff, to settle some disagreements that arose between the police and members of the then budding sect in 2009.

However, what was paradoxical was that Mr Shettima was also in the government of his predecessor as a commissioner in 5 different Ministries, and has a great share in any blame with that government, over the latter’s inability to crack this sect while it was budding or harmonise the political instability the disagreements led to. In the lecture, he also went ahead to narrate of how several unnecessary conspiracy theories have been created out of the Boko Haram crisis especially during the immediate past regime, which were not necessary for the unity and development of the country. He commented that such theories prevented the past government from finding immediate measures in rescuing the missing Chibok girls. The lecture also highlighted his disagreements with several NGOs and INGOs involved in managing the humanitarian crisis in the north-eastern part of the country, and a briefing on his efforts on education and agriculture in Borno State. He ended by saying that his government is liaising with other stakeholders to make sure that the IDP camps in the north-east would be closed in May this year.

This was another shocking paradox considering that hundreds of thousands of IDPs are all over the sub-region. As at now, the war on Boko Haram just went into a transition of what could be near permanent crackdown on the sect. There is no sort of reconstruction efforts in these communities and the governor wants the IDPs to return to Borno. There are no hospitals, schools; farmlands are devastated; no alternative sources of livelihood. There are no sorts of reconstruction, reintegration and rehabilitation plans on-going. Such mass return by such a deadline that ain’t feasible is not realistic. There should be efforts to make sure IDPs are living fairly well in their camps while the government concentrates on re-building their communities and creating a conducive environment for them, before they return home.

 

Chambers Umezulike is a Program Officer at Connected Development and a Development Expert. He spends most of his time writing and choreographing researches on good and economic governance. He tweets via @Prof_Umezulike.

The Denouement of Primary Export Dependence – Nigeria’s Economic Recession

The Denouement of Primary Export Dependence – Nigeria’s Economic Recession

Photo Credit: post-nigeria.com

According to Nigeria National Bureau of Statistics, the country’s Gross Domestic Product contracted by 0.36% in the Quarter(Q) 1 of 2016, the first negative growth in many years. Successive contractions in Q2 and Q3 of the same year by 2.1% and 2.24%, respectively, officially chaperoned Nigeria into an economic recession. Even before the country’s general elections in March 2015, the country had already started encountering a considerable number of pre-recession prodromes such as wages crisis, Foreign Exchange (FOREX) scarcity, compressing governmental revenues and domestic savings, rising inflation, job losses, a depreciating national currency, depleting foreign reserves, escalating poverty, while the country’s capital market started losing billions of Naira.

These prodromes gradually worsened in succeeding months after the Muhammadu Buhari led administration came into office in May 2015. Between Q4 of 2015 and Q3 of last year, inflation rose from 9.5 to 18.3%. Similarly, unemployment grew from 10.4 to 13.9%; Naira depreciated at the contemporaneous market by around 100%, from around 225 to 450 while it remained officially pegged at 305 per US$1. For the latter, last year, the country’s Central Bank adopted a partial flexible exchange rate regime and consequently, the feeble national currency has been valued at the aforementioned rate upward. Through this, South Africa overtook and undertook Nigeria as Africa’s biggest economy in dollar terms. In addition, foreign reserves depleted from US$29 billion to 25 billion.

As a primary export dependent country, Nigeria has been an unblushing subject of international oil prices’ oscillations. Its current economic crisis is an echolalia of the early 1980s scenario which subsequently led to the country’s adoption of the Structural Adjustment Program to circumvent the economic crisis. The 1980s economic crisis frustrated economic growth in the country even till the 1990s. Between 1981 and 1985 in the country’s 2nd Republic, crude oil prices fell by 25% to US$30 per barrel from US$40. As a result, the economy went into a recession as FOREX earnings remained at US$52.78 million, away from the estimated $79.449. External debt rose to Naira 17.3 billion from an estimate of 3.7 billion. By 1985, Nigeria’s external reserves had run close to a level that could hardly finance more than one and half month import bills.

Similarly, after the sudden crash in global oil prices from $112 per barrel in the Q4 of 2014 to $43 per barrel in the Q2 quarter of 2016, the country experienced reduced FOREX earnings and governmental revenues. This then affected most sectors of the economy. Oil revenues constitute 90% of the country’s FOREX earnings (2013 estimate) and around 80% of sources of government’s revenues. Previous efforts to diversify sources of these earnings such as the 2nd, 3rd, and 4th National Development Plans and other economic regimes of successive leadership since the country’s 4th Republic have achieved contracted results.

In addition, through several apocalyptic economic tactics, the country’s topical administration also contributed to the recession, albeit they are in the process of commissioning an economic blueprint to contain it. First, from Q3 of 2015, its indecisiveness on devaluing the Naira to reduce the pressure on it skyrocketed the black market premium and incentivised arbitrage. Secondly, over the inability of the administration to keep paying oil marketers in foreign currencies so as to import refined crude into the country because of FOREX scarcity, the administration was forced to remove petroleum subsidy in early last year. This had an immediate and terrible impact on inflation. Thirdly, over previous efforts to protect the Naira, the Central Bank placed a ban on the importation of 41 items. This alone worsened the situation by creating scarcity of the products, precipitating job losses and closure of businesses.

However, a good attempt by the administration to implement an expansionary budget in the 2016 fiscal year and increase its capital expenditure component by 30% was partly hampered by ceaseless oil pipeline vandalisation by the Niger Delta militants. This deeply affected the administration’s ability to fully implement the budget as a result of drop in oil output from 1818 barrels per day in the Q4 of 2015 to 1270 in the Q2 of 2016. Also, President Buhari’s delay in appointing ministers and the resultant padding of the budget saga affected a timely implementation of the budget.

Till today, while the government has promised to release a report of the 2016 budget performance analysis by the end of January 2017, they have not. Furthermore, efforts by the administration to diversify the economy by expanding agriculture and amplifying solid minerals exploration have recorded nanoscopic results over the lack of coherent strategies to achieve such. Finally, limited results from the administration’s efforts to improve the ease of doing business and boost investors’ confidence have further imperiled the attraction of foreign capital into the country.

The economic recession is largely Nigeria’s choice and not just oil price shock because it was predictable and largely avoidable. It remains imperative that Abuja make sure that it’s Economic Recovery and Growth Plan is a comprehensible economic blueprint that could address the recession with strategies, projections, targets, programs to cushion its effects etc. They should swiftly devise ways to keep pumping money into the economy, without the commensurate inflationary tendencies it can bring. Following this, the series of jocose frivolous items on the 2017 budget have to be clinically jettisoned while the fund rather goes into capital expenditure. They should also lift the ban on the importation of the aforementioned items. Import led industrialisation strategy has always failed outstandingly when it’s not backed up with coherent or backed up with anomalous tactics. Ultimately, there should be further sound strategies to aggressively attract foreign capital, position the country for industrialisation, diversify exports; and reduce poverty and unemployment.

 

Chambers Umezulike is a Program Officer at Connected Development and a Development Expert. He spends most of his time writing and choreographing researches on good and economic governance. He tweets via @Prof_Umezulike.

Climate Change Mitigation, Adaptation and Trigger-Factors on the 2017 Budget Proposal

Climate Change Mitigation, Adaptation and Trigger-Factors on the 2017 Budget Proposal

(‘Talking Sanitation’ –  an unclear and questionable budget item under an agency of the Environment Ministry)

On the 30th and 31st January 2017, the Centre for Social Justice (CSJ) in partnership with the German Embassy organized a Workshop on Climate Change and the 2017 Budget Proposal. In participation were over 30 participants drawn from relevant government’s Ministries, Departments and Agencies (MDAs); Civil Society Organizations; the academia; and the private sector. Connected Development was invited in recognition of our works in Sustainable Development and I represented the organization.

The workshop was a product of a CSJ’s project on devising templates for a low carbon budget framework in ten key sectors of the Nigerian economy. The sectors involved are agriculture, energy, environment, finance and national planning, housing, labour and productivity, mines and steel, transport, water resources and works. The project is also geared to mainstream mitigation and adaptation measures on climate change into the budgeting process.

The workshop was for an intensive analysis of the 2017 federal budget in the aforementioned ten sectors on climate change mitigation and adaptation budget lines, as well as budget lines that would lead to the emission of more greenhouse gases into the atmosphere. A key component of the workshop was a policy brief which would be used in engaging various federal legislative committees in the approval of the 2017 federal budget.

The first day of the conference started with paper presentations on the budget of several ministries, representing the aforementioned sectors. Post these interesting presentations was then the segmentation of the participants into several groups to further analyse segments of the budget and make policy recommendations on how the budget could further and effectively influence  climate change mitigation and adaptation. These recommendations would be forwarded to the National Assembly.

Key observations from the workshop include that most of the budget lines on the 2017 budget were deeply ambiguous, questionable and lack-specificity. This has occasioned a scenario where the public cannot be able to analyse these items thoroughly or even understand what they mean (see the image above). It is expected that moving forward, several ministries should make these budget items specific with some details even if a budget item could take three lines.

I was really impressed by this workshop, with the great team of CSJ that did beautiful work in organizing the event, embarking on such great research and having the papers ready for review during the workshop. I also met interesting participants and elemental stakeholders from several MDAs whose group contributions were so helpful, and offside discussions during tea and lunch breaks, I learnt so much from. I so much hope that through the post workshop strategies that were identified at the end of the conference, CSJ would be able to initiate extensive debates on the National Assembly during deliberations on the 2017 budget proposal.

Chambers Umezulike is a Program Officer at Connected Development and a Development Expert. He spends most of his time writing and choreographing researches on good and economic governance. He tweets via @Prof_Umezulike.

This present National Assembly is not entirely useless

This present National Assembly is not entirely useless

Thoughts on the Interrogation of the NGN 9.2 billion Women Clean Cook Stove Project Saga by the Federal House of Representatives

 

I have been involved in several dialectics on the practical importance of the National Assembly (NASS) since 1999. Most of such dialectics have ended with the conclusion that the institution has been a gross waste while levying the country so much. The foundation of this conclusion is rooted on several actualities. First, since 1999, the NASS has been used as a compensatory platform to settle former politicians and a mechanism for accentuating a post-1999 outbreak of political patronage in Nigeria. In short, the institution has directly supervised the proliferation and culturalization of contemporary corruption in the country. Secondly, the leadership crisis the Senate experienced from 1990 to 2003 started occasioning some elements of incertitude on the minds of Nigerians on what could be the real essence of such institution. Thirdly, one cannot remember any bills from the National Assembly that has had any impacts on the lives of ordinary Nigerians.

Fourthly, since 2007, despite a peroration of leadership crisis in the Senate, the NASS then became a traditional resort and relaxation point for failed and grossly corrupt governors, who siphoned all their states had, and were seeking ways to get covered with some sort of immunity from prosecution. To some of the lawmakers, it was a tool of still being relevant and in the political game. Fifthly, what irritates most Nigerians also encompass the fact that over 5 per cent of our national budget goes to the National Assembly. Conversely, such expenditure has been immersed in extensive secrecy with even pedestrian knowledge-deficit on what they do with such percentage. Sixthly, the NASS has gross-transparency and accountability deficit. The Nigerian lawmakers are the most paid all over the world, with humongous amounts of constituency allowances for implementing projects in their constituencies which they do not account for.

I am personally an exponent of this narrative that NASS has been a colossal waste up to this point, since 1999. I am part of those advocating that law-makers remuneration should be grossly cut to de-incentivize the transposition of clueless politicians to either of the chambers. While law-making should be a part-time activity. I am also part of those advocating for the eradication of constituency allowances since there are no monitoring and evaluation regime to ensure project implementation. I am also part of those advocating for the concatenation of the two chambers. Ultimately, I am part of those strongly advocating for #OpenNASS.

However, despite the inadequacies of the NASS including the present one, and the fact that it is still business as usual, one would be sincere of the fact that this present NASS ain’t that entirely useless. If you could remember, they were the ones that stopped the government from borrowing $30 billion while there were no plans on what to use it for. They were the ones that suspended the sale of national assets. They were the ones that suspended the increment on phone data tariffs. They have indeed made some critical interventions whether they did this in the interest of Nigerians or for political intricacies.

Consequently, just few days ago, the Federal House of Representatives (HOR) commissioned its committees on Anti-Corruption, Environment and Habitat to carry off an investigation over the last administration’s “Clean Stove For Rural Women Project,” which was under the Ministry of Environment. The project was at NGN 9.287 billion and initiated in 2014 to supply 750,000 units of clean stoves and 18,000 wonderbags to rural women. If you could remember so well, the project was chaperoned by a saga, resultantly from ambiguity in its contracting processes, cause celebre on the number of stoves that were procured and dynamics of the 2015 political transition.

This is a project that Connected Development’s Follow The Money (a grass-root anti-corruption movement) has been tracking its spending since 2014. The organization subsequently found out that only 45,000 clean cookstoves were provided and exhibited at the Velodrome of the National Stadium in Abuja. In addition, it also revealed that out of the 9.2 billion Naira, Federal Ministry of Finance only released N5 billion to the Federal Ministry of Environment for the execution of the project, and the Ministry of Environment only released 1.3 billion Naira to the contractor of the project – Integra Renewable Energy Services Limited. Till today, no one has seen any single beneficiary of the cookstoves.

It’s beautiful that the present NASS has also intervened in another great area through this investigation. I hope the investigation would not be compromised but would rather springboard appurtenant sanctions for those that compromised the rule of law in the process of the project.  I also wish to call on the Committees involved to implement this investigation in an open manner so that all relevant stakeholders (civil society and the media) can witness it to share findings, narratives and ensure transparency in such effort.

 

Chambers Umezulike is a Program Officer at Connected Development and a Development Expert. He spends most of his time writing and choreographing researches on good and economic governance. He tweets via @Prof_Umezulike.