Government spends N753.6b capital votes without evidence of implementation

Government spends N753.6b capital votes without evidence of implementation

Seven months into the implementation of the 2016 fiscal plan, the Budget Office of the Federation, and the Ministry of Budget and National Planning are yet to furnish the nation with how the sum of N753.633 billion, released to Ministries, Departments and Agencies (MDAs) was deployed, and for what projected.

The implementation of, particularly capital votes of the 2016 spending plan, which commenced in earnest in May this year when the Appropriation Bill was signed into law, is expected to continue till May 2017 as the Presidency had sought, and obtained the approval of the National Assembly to extend the implementation to achieve a full year cycle of implementation.
The Guardian at the weekend exclusively obtained the breakdown of the capital votes releases to MDAs as at the end of October this year, which was the last time funds were released to them.

However, there is no implementation report so far to indicate the projects and the level of their implementation, as it is always the case.

Lead Director of the Centre for Social Justice [Censoj], a non-governmental agency with focus on equitable distribution of the nation’s commonwealth, Mr. Eze Onykpere, described the development as “absurd and a contravention of the Fiscal Responsibility Law 2007.’’
According to Eze, “This is unacceptable and goes a long way to show the lack of capacity and the level of dereliction that the team, which our affairs are consigned in their hands are made of. It’s a serious matter because they are violating the 2007 fiscal Responsibility Law, which demands that the financial activities of every quarter must be published and widely circulated in both print, electronic media as well as hoisted on their websites. It’s a serious infraction,” he insisted.

Eze added that the implication of the lack of transparency in spending so much sums funds in the absence of an implementation report is a veritable platform for corruption to fester, just as he called on the National Assembly to get serious with its oversight functions to check the drift.

A table of the 2016 budget disbursements from the Office of the Accountant-General of the Federation (OAGF) indicates that of the amount released so far, the Ministry of Works, Housing and Power received the lion share, totaling N209.246 billion, out of the N422.964 billion votes approved in the budget.

The other MDAs that got funding include : Defence Ministry, N69.512b; Transport Ministry, N30.540b; Agriculture Ministry, N29.578b; Ministry of Water Resources, N25.201b; Ministry of Interior, N21.210b; Ministry of Health, N18.472b; Education Ministry, N16.743b; Ministry of Niger Delta, N8.161b, while the Ministry of Science and Technology got N6.681b. Ministries of Mines and Steel and that of Petroleum, got the sum of N3.360b and N2.413 billion respectively.

The rest MDAs shared a consolidated sum of N312.511b.

The Ministry of Budget and National Planning, was not forthcoming with reasons for the absence of an implementation report.

Spokesman of the minister, Mr. James Akpandem, told The Guardian that: “What you should do is take the figures released and matched them with ministries and projects indicated against them. That would give you a more convincing answer than relying on my response, which may be seen as “ throwing” figures around the releases..”

Adeosun details fiscal roadmap to reset Nigerian economy to growth

Adeosun details fiscal roadmap to reset Nigerian economy to growth

The Minister of Finance, Mrs Kemi Adeosun, on Friday outlined a 10-point fiscal roadmap to reset the Nigerian economy to a path of growth.

The Minister, who represented His Excellency the Vice President, Yemi Osinbajo, at the annual dinner of the Lagos Business School, itemised fiscal policies and actions being rolled out to tackle the key barriers to growth.

Speaking at the session which was attended by industry leaders across key sectors of the economy including oil, banking and telecoms, Adeosun said “The Federal Government’s Fiscal Roadmap is addressing barriers to growth that will drive productivity, generate jobs and broaden wealth creating opportunities to achieve inclusive growth”.

She stated that the President Muhammadu Buhari administration is determined to convert Nigeria to a productive economy rather than one that is consumption driven. To do so, Government would tackle the infrastructure deficit to unlock productivity, improve business competitiveness and create employment.

She stated that Government would actively partner with the private sector to achieve this by use of a number of new funding platforms. These include the Road Trust Fund, which will develop potentially tollable roads, and the Family Homes Fund which is an ongoing PPP initiative for funding of affordable housing.

In addition she detailed a revision to the Tax provision that allows companies to receive tax relief for investment in roads on a collective basis. She explained that the existing provision that enabled companies to claim relief for road projects had only been taken advantage of by two companies, Lafarge and Dangote Cement. This was because few companies were large enough to fund roads alone.

The revision would now allow collective tax relief such that companies will be able to jointly fund roads, subject to approval by FIRS and the Ministry of Works, and share the tax credit. This would be particularly attractive to firms in clusters such as industrial estates, many of which are plagued by poor road conditions.

She emphasised the role of infrastructure in creating inclusive growth, explaining the current barriers to growth in agriculture, solid minerals and manufacturing. She stated that the drivers of inflation were structural and were being addressed through the focus on power, rail and road infrastructure.

The Minister also outlined measures planned to deal with the problem of hidden liabilities, which were affecting the banking sector and efforts to revive the economy. The Minister explained that the conversion from cash accounting to IPSAS (International Public Sector Accounting Standards) had unveiled unrecorded debts owed to contractors, oil marketers, exporters, electricity distribution companies and others.

These liabilities were estimated at N2.2 Trillion and would be addressed with a 10 year Promissory Note Issuance programme in conjunction with the Central Bank of Nigeria. This measure would be subject to a rigorous audit process of all claims to ensure validity and mitigate against fraud and the impact of past corrupt practices.

Henceforth, the Minister said that measures would be put in place to prevent recurrence of such a problem by ensuring that contracts are managed in a manner that firms have assurance over when they would be paid.

She cited the fact that many contractors were owed as a reason that many of those recently paid by Government were slow in remobilising to site: “Some contractors had not been paid in the past 4 years and in some cases the banks they were owing refused them access to the funds released, causing delays”.

She explained further that those receiving the Promissory Notes would be expected to provide a material discount to government. The issuance was a solution to a long term problem that was ‘a drag on economic activity’.

Adeosun concluded her remarks by assuring that, despite the current economic challenges facing the Nigerian economy, the outlook is positive due to the strong fundamentals of Nigeria and the ongoing reform programme.

She reiterated that Government is determined to create an enabling environment and put in place supportive policies to return to growth in 2017 including greater alignment of monetary and fiscal policies.

The fiscal roadmap is detailed in the attached 10-point plan