How Rivers 2019 Budget Sailed Through RSHA


There are high expectations following the passage of the 2019 Appropriation Bill by the Rivers State House of Assembly, and its assent by Governor Nyesom Wike.
The expectations are equally coming from the legislators who in majority believe that the budget needs no further delay in approval and implementation since there are lots of projects at hand to be completed.
As expected, the budget got the required attention; even on the day of presentation, the lawmakers gave it a quick look as it passed the first reading.
Speaker of the Assembly, Rt. Hon. Ikuinyi-Owaji Ibani, described the budget as a balanced one. Ibani’s view was formed on the basis that the appropriation bill addresses all sectors of governance, even though the capital expenditure is almost triple the recurrent expenditure.
A breakdown of the budget indicates that about N157 billion was earmarked for recurrent expenditure, while over N323 billion was set aside for capital expenditure.
Sectoral allocations shows that the social sector had the largest chunk of N170 billion. This is followed by the economic sector with N99.2billion trailed behind by allocation for roads infrastructure totaling N72billion.
While expenditures for administrative purposes N17 billion, the security sector had N18 billion, Law/Justice got 4.3 billion and health N50 billion.
Provisions were made for staff promotion arrears, pensions at the sum of N33 billion, while grants and subventions to tertiary institutions in the educational sector got N500 million each.
Last Friday, while debating the report of the House Committee on Public Finance and Accounts, some legislators sought for increment in the budget proposal. One of such is the member representing Ogba/Egbema/Ndoni II, Hon Nathaniel Uwaji. He believed that there is a lot of huge projects that requires higher funding.
The member representing Obio/Akpor Constituency II, Hon Michael Chinda harped on the need to focus on key projects. The legislator sought for addition of projects that would affect his constituents.
Chinda observed that inclusion of more projects would make the budget more expansive in the area of addressing vital needs of constituents.
The same view was expressed by Hon. Bariene Deeyah of Khana Constituency 1. He said, “This budget will affect Ogoni area positively. For me, the Sakpenwa-Bori Road project is a support service for Ogoni area”.
While commending the budget, the Khana 1 Constituency representative argued that the project will open up Ogoni land, adding that, “Let us not waste time to pass this budget into law”.
In the same vein, Hon. Eremi George Alabo representing Asari-Toru Constituency 1 opined that, “this is one budget that will move our state forward. About N23billion provided for a contingency fund is very crucial, so I will support for the quick passage of this budget”.
Calling for the inclusion of more projects into the budget, the legislator representing Etche Constituency 1, Tony Ejiokwe, observed that his constituents at Umuebule/Ikwerre Ngwo and Chokota would want their roads to be completed.
As more project request continued, the speaker intervened when he gave assurance that the budget would address all their requests. However the request made by Hon Chinda stood out.
Chinda requested that pedestrian bridge should be built on Aba Express Road for leisure seekers at the Pleasure Park. The lawmaker expressed fears that the bridge was needed to avert accidents, as people going to the park have to cross the expressway to access the facility.
While analysing the 2019 budget proposal, a professor of economics at the Rivers State University, Prof Ayodele Momodu, had described the budget as a promising one.
“A situation where the capital expenditure is higher than the recurrent expenditure is encouraging,” he said, “I am happy because when the roads are built, and contractors are paid, it trickles down to the common man”.
Momodu who is an expert on econometrics further opined that the state budget is more realistic than that of the federal government. For instance, the state budget was made with projections more moderate than that of the federal.
One of such projections, was in the oil price put at 12 dollars and at a daily output of 2million barrels per day. The federal projection was put at 2.5million barrels per day.
On the projections, Momodu observed that, “we have never made 2.3million barrels per day and that is why, I believe Wike is more realistic considering the situation in the oil market”.
The university don also commended the state governor for sustaining the usual capital budget for three years running. He carpeted critics of the Wike administration, arguing that capital expenditure would trigger economic development.
In his words, “Capital expenditure will drive the economy. In short, recurrent expenditure should be derived from capital expenditure. Once you are not developing your infrastructure, other sectors will remain stagnant.
On the other hand, Momodu pointed out that there is need to also give attention to manpower sustenance. The professor was of the view that accumulated promotion arrears can be demoralising to the workforce.
“If you don’t address welfare it kills morale of workers, so there should be effort made in that direction, and I think the budget had taken cognizance of that”.
The varsity don was pessimistic over the impact of the new minimum wage, “Once the civil servants get new wage there would be inflation because, as far as I am concerned, there is something fundamentally wrong with our economy. It would affect the cost of production because the private sector would be forced to raise wages of its workers as well.”
The major disconnect or factor destabilising the system in the view of Prof Momodu is lack of production. “We are not producing anything so the prices of foodstuffs will automatically go up”.
He believes that the situation may hamper the positive effect of the state budget, “you cannot take out Rivers State from Nigeria. Our state is not independent of what happens at the federal level”.
On how to cushion the effects he suggested the need to stimulate employment, “We should, as a state, look into areas of comparative advantage like fishing and farming.
“We need to begin to develop the culture of diversification. I think government should provide the facilities. All those moribund state-owned companies should be sold off, it’s not the business of government doing business.
It is the private sector that will generate jobs, but government will provide the drive and atmosphere,” Momodu emphasized.