Post Views: 499 Professor Kingsley Moghalu, a presidential aspirant of the Young Progressive Party (YPP) for the 2019 general elections, on Thursday s...
Professor Kingsley Moghalu, a presidential aspirant of the Young Progressive Party (YPP) for the 2019 general elections, on Thursday said the 2018 budget signed into law by President Muhammadu Buhari at the mid-week in Abuja, is a continuation of the longer-term dislocation of fiscal policy by the administration so far.
He lamented that Nigeria’s annual budget has risen sharply from N4.4tr in 2015 to N6.06tr in the following year, N7.4tr in 2017, and N9.12tr this year, even as the President announced plans for a supplementary budget in a year when the year is half-way gone.
In a statement by Jide Akintunde, his official spokesman, Moghalu lamented the rise in public debt from N12.1tr at the end of June 2015 to N22.7tr at the end of March, 2018, warning that the administration’s debt-fuelled expansionary budgets are doing incalculable damage to the fiscal future of the country and will impose a hefty debt burden on today’s Nigerian youth in future.
Within the three years and despite the budget more than doubling, Moghalu, a former deputy governor of the Central Bank of Nigeria (CBN), said the nation slipped into economic recession, the worst in 25 year, contracting by 1.5%, followed by sluggish recovery of 0.8% growth in 2017.
This, he continued, represents an 87.6% growth in public debt in less than three years, just as “cost of debt service as a ratio of government revenue now hovers around 60%.
“And not one kobo of allocation for capital expenditure is any longer covered by government revenue. Capital expenditure allocation is entirely funded by borrowing, even as the country’s debt repayment is also being funded by debt.”
The Buhari administration, he continued, has with the 2016 and 2017 budgets spent more than N3 trillion on capital expenditure, which is unprecedented in the history of budgeting in Nigeria.
“The administration flashes this scorecard to Nigerians. But the problem is that infrastructure project delivery in the country in these two fiscal years was underwhelming, without any major improvement in the country’s infrastructure stock.
This is why, he believes Nigeria needs “a competent leader with knowledge and character is what Nigeria needs to steer fiscal policy to support sustainable economic growth and development of Nigeria.
“We also believe that the foreign borrowing binge of the Buhari administration must be curtailed as an inevitable part of recreating our country’s future, a future in which Nigerians of the next generations would not be saddled with crippling public debt.”
He also decried the continued blame-game by the executive and legislative arms over the budget after a six-month delay, with the President Buhari expressed concerns over the alterations made by the National Assembly to the appropriation bill before passing it. Buhari said the alterations will make the budget difficult to implement.
Responding, the National Assembly alluded to its “constitutional power of appropriation,” which empowers it to alter the budget proposal submitted to it by the President. The National Assembly also blames the executive for late submission of the 2018 budget and cited the failure of heads of MDAs to defend their budgets before the lawmakers on time.
“This blame game smack of lack of leadership to make the budgetary process efficient and effective in serving the people of Nigeria.
“At the root of Buhari’s complaint is the putative “constitutional power of appropriation” claimed by the National Assembly. We believe the executive should lay the controversy to rest by seeking judicial interpretation of the 1999 Constitution (as amended), on the power of the National Assembly to alter the yearly appropriation bill. If the power is legally valid, then effective collaboration between the executive and the legislature on the yearly budgets becomes imperative.
“The Buhari administration has glossed over this judicial solution to, once and for all, solve the perennial problem of “budget padding.” The administration is instead relying on its trusted propaganda machinery, which entails blaming everyone else but itself and leaving Nigerian people unserved or underserved with fiscal policy,” Moghalu stressed.