2016 Budget: Need For Thorough Scrutiny

One feature of a corporate
plan is a series of budgets that translate country, state, local government or company intentions into a series of assignment and provide the money to carry them out. The Oxford Advanced Lerner’s Dictionary defines budget  as the money that is available to a person or an organization and plan of how it will be spent over a period of time. Since a budget extends over a period of time, it represents a flow of assignments rather than a stationary approach, and changes can be made rather quickly, especially if the budgets are reviewed monthly or quarterly.
There are two main types of budgets which include capital and expense. Capital spending is investment, merely a change in the form in which assets are held. The money a government or company spends to carry on its day-to-day activities or business, on the other hand, represents the actual out-of-pocket costs that must be recovered through internally generated revenue or sales during the budget year.
In the government circle, budgets are targeted to capture all the projects and activities proposed for the year, hence we have the capital expenditure, recurrent expenditure and the targeted revenue. In every budget, some scheme of priorities for projects must be adopted and there are some projects that simply have to be undertaken regardless of the economic calculations, since they must be budgeted for if the country should live up to its responsibilities or expectations.
There are projects required to meet the provisions of the law and there are numerous regulations by local, state and federal governments relating to security, defence, employment and employees’ welfare, among others that may necessitate new investment or expenditure. If there is pressure on government to tackle a problem that affects generality of the citizenry, it may have to spend a great deal of money for solution even though the project brings in no return in  the conventional sense. Generally, when a government is compelled to restrategise, it has to incorporate improvements.
The controversy that trailed the 2016 Budget would have been avoided if those who prepared it for the President before presentation to the National Assembly were careful and displayed professionalism in that craft. When President Muhammadu Buhari assumed office, on being sworn-in, he told Nigerians that a team of technocrats had been assembled to affect the change philosophy of the ruling All Progressives Congress (APC).
In fact, the circumstances that surrounded the 2016 Budget that was presented to the Senate on Tuesday, December 23, 2015 is a clear indication and manifestation  of incompetency from the Presidency to the Senate. At no time in the history of Nigeria that a documented budget proposal was pronounced missing or withdrawn from the Senate after presentation. A lot of Nigerians were disgusted and disappointed with the intricacies that contrived the budget.
From a 2-week recess, the Senate resumed plenary without the 2016 Budget on the order paper for debate amid heightened curiosity, as to what might have gone wrong. Some senators allged that the budget was nowhere to be found at the National Assembly with other fillers that the budget documents that were laid before the Senate by President Buhari early December 2015 had not been duplicated for distribution to Senators and members of the House of Representatives due to paucity of funds. There was also a wide speculation in some quarters that the documents had been withdrawn or got missing from the Senate. Some lawmakers said they were suspicious that the Presidency might have colluded with the management of NASS to quietly withdraw the documents after detecting some discrepancies in them.
One of them likened it to a kind of national embarrassment. His words, “can you imagine this kind of national embarrassment? Documents that were presented to us with fanfare have been stolen. This is unbelievable as it has not happened since history of Nigeria”. Senators of the PDP accused the Presidency of being behind the theft of the documents, an accusation rejected by APC, who said it was too early to speculate.
On his part, Senate President Abubakar Bukola Saraki later denied disappearance of the budget but disclosed that copies of a version different from the 2016 Appropriation Bill as originally laid by Buhari had been served to senators by the Special Adviser to President Buhari on NASS Matters, Senator Eta Enang. According to him, it was alteration of the doctoring of the original documents, pointing out that the finding of the Committee on Ethics, Privileges and Public Petitions on investigations surrounding the 2016 Appropriation Bill was that Senator Eta Enang printed copies on the Bill and brought to the Senate was different from the version presented by Mr. President.
A former National Chairman of the APC, and one-time governor of Osun State, Bisi Akande while commenting on the 2016 budget controversy in an interview, lampooned the Senate leadership for what he described as an act of indiscipline. He said that his party was mindful of the consequences of allowing wrong people to be at the helm of affairs which was the reason the party wanted disciplined individuals to lead the Senate.
“Nigeria’s budget is huge document and wonders how such a document could be missing in the Senate”, Akande said, adding “the development is a fallout of indiscipline that brought the current leadership of the Senate into the position and as you know, that was not the choice of our party”.
The Presidency had after presenting the budget discovered that some of the figures proposed were increasingly high through a letter addressed to Bukola Saraki and Dogara of the NASS and House of Representatives respectively. The report revealed that the old budget contained major omissions like absence of allocation for the second Niger Bridge while a large sum was allocated for line items which had now been reviewed.
Following the purported missing of the documents, the Senate President Saraki met with President Buhari at the Presidential Villa.
It is traditional that once the budget is laid, it would be referred to the joint  Committee on Finance and Appropriations for section by section analysis. That the differences spotted by the Senate “do not really affect the substance of the budget to the extent that there is serious breach” is not enough to believe that all is well with the budget, even though the Senate went ahead to deliberate on it.
The preparation of the 2016 Appropriation Bill was a litmus test of the Presidency’s efficiency, but the controversy that trailed it on presentation to the Senate shows that no thorough work was done. The criticisms and revelations that followed or emerged in the process and the carelessness of the NASS management in securing the original copy laid before the Senators by President Buhari amply signify that the budget is not perfect. Before the controversies that beclouded the budget, there had been some hard knocks on it in some quarters.
One of such criticisms came from a renowned Nigerian Economist, Professor Pat Utomi, who described the 2016 national budget as ‘a joke’. President Buhari had presented a budget estimate of N6.08 trillion before a joint session of the National Assembly on Tuesday, December 22, 2015. Speaking on Channels Television’s Sunrise Daily, Professor Utomi said, “Putting it in a very awkward position, I consider the budget process a joke”. He said the issue was not about making luxurious budget but argued that the major deterrent was always implementation”.
Utomi emphasized, “we somehow do not have the discipline of the budget process, we go through budget as public relations exercises because they are supposed to be done and decision makers go ahead to do whatever they want to do” . Proffering solutions to the problem of budget implementation in the country, he said “the goal is to achieve an execution premium, but if those who are responsible for the budget really had no plan whatsoever to follow it, then, you are wasting your time”. “I think what has happened to us is that we got to a point of disconnect between the leadership elite, the political class, the bureaucratic elite and development aspirants of the Nigerian people. The major reason the budget is not working in Nigeria is leadership”, Utomi said.
Indeed, there is low energy in the leadership of this country as they are not leading in the right direction. The country is dealing with a huge financing gap, no doubt, and we cannot pretend that all is well, but if we do, then, “we will run into an economic spiral”.
Also bemoaning the 2016 budget, the PDP said, “By all standards, the budget, the first major economic policy outing of this present government, is completely unrealistic and duplicitously embellished with impractical predictions, a development that confirms fears by economy watchers and investors that this administration is obviously ill-equipped for governance”. The PDP, therefore, advised President Buhari to once again involve experienced and well-tested hands in the management of the economy, and budgeting processes.
A very important type of budget to which countries across the globe are giving increased attention these days is the cash flow budget. A country may estimate a certain amount over the period of a year and find itself in difficulty, even if the estimate is accurate. Money seldom flows in evenly. In the meantime, Nigeria needs money to finance projects and provide the welfare needs of the people and not a bogus budget that is not realizable and implementable. Comparison of performance against budget is one of the best methods of determining whether or not the country is spending more or less than it had planned to, and tracing the reasons for overages and underages or deficit and making any necessary corrections.
Budgets are an excellent tool for both planning and control, although they have their shortcomings. Thus, the budget is usually based on historical trends which may not continue as it may be influenced by what the leadership of the country or state would like to happen or do. Naturally, the leaders are interested in larger money and hopefully budget on the basis that this will materialize, even  though the chances of their doing so are not very great. So, the 2016 budget in its final form must be carefully scrutinized and watched to achieve the best result and proper implementation.

President Muhammadu Buhari

Shedie Okpara