President Buhari signs 2018 budget, berates parliament of padding spending plans
By Olumidagreaton June 20, 2018
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President Muhammadu Buhari on Wednesday finally signed the country’s 2018 budget into law, more than seven months after he presented the fiscal policy to the joint sitting of the National Assembly and a month after the parliament approved the spending plan.
The president also hinted he would soon send a supplementary plan to the lawmakers to remedy the inclusion of some unrealistic project in the fiscal policy by members of the National Assembly.
Global Financial Digest had in an exclusive report on Sunday revealed that the government intends to forward to the National Assembly a supplementary budget to address all the padding done by the lawmakers.
Many analysts believed the move by the president could cause another round of row between the executive and the parliament and prolong the efforts by the government to stimulate the economy, using the 2018 budget as a tool.
The parliament has jerked up this year’s spending estimate to 9.12 trillion naira from 8.6 trillion naira submitted by the executive in November and inserted more than six thousand projects into the budget to cater for the lawmakers’ constituency.
Before signing the document, the president has expressed regret that the lawmakers slashed 347 billion naira in the allocations to 4,700 projects submitted by the executive and injected 6,403 projects of their own worth 578 billion naira.
“I am however concerned about some of the changes The National Assembly has made to the budget proposals I presented.
“The logic behind the constitutional direction that budgets should be proposed by the Executive is that, it is the Executive that knows & defines its policies & projects.
“Unfortunately, that has not been given much regard in what has been sent to me. The National Assembly made cuts amounting to 347 billion naira in the allocations to 4,700 projects submitted to them for consideration and introduced 6,403 projects of their own amounting to 578 billion naira,” the president noted.
“As it is, some of these projects relate to matters that are the responsibility of the States and Local Governments, and for which the Federal Government should therefore not be unduly burdened.”
Muhammadu Buhari is pushing to foster growth in Nigeria, which has West Africa’s biggest economy, before an election next February in which he will seek a second term. His economic policies and their impact on Nigerians could sway voters.
The president also accused the parliament of jerking up its own budget from 125 billion naira to 139.5 billion naira and cut back on funding for housing projects by 8.7 billion naira.
“I have decided to sign the 2018 budget in order not to further slow down the pace of recovery of our economy, which has doubtlessly been affected by the delay in passing the budget,” said Buhari in his speech after the signing.
Nigeria, Africa’s top oil producer, emerged from its first recession in 25 years in 2017, helped by higher crude prices, but growth remains fragile.
Budgets under Buhari, who took office in May 2015, have been Nigeria’s largest ever – the latest is up from last year’s 7.44 trillion-naira spending plan. But economists say implementation has been poor and failed to provide the type of capital spending needed to improve infrastructure.
“Despite the approach of elections in early 2019, there is no reason to assume this time around that all of the spending plans will necessarily be executed,” said Razia Khan, chief Africa economist at Standard Chartered Bank.
She added that the plan for a supplementary budget was “likely to be because of some degree of uncertainty as to the value of all the spending projects that were proposed by the Senate and approved”.
John Ashbourne, a senior emerging markets economist at Capital Economics, said next year’s vote, in which some legislators will seek election, may have led to the insertion of some projects by lawmakers.
The International Monetary Fund in February said Nigerians were getting poorer despite the recovery from recession. Inflation has fallen for 16 straight months, slowing to a more than two year low of 11.6 percent in MaMay.