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In the last few years, the unreleased budget allocation has become the undoing of the government in terms of its several laudable initiatives. Many transformational projects have been abandoned in the past due to this menace perpetrated by the Federal Ministry of Finance, under the guise of strict adherence to due process and the late passage of budget by the National Assembly. Consequently, this often leads to poor budget performance. Some analysts have alleged that it is treasonable not to allocate fully what has been passed by the National Assembly. The Co-ordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala has come under fire from members of the National Assembly over repeated poor implementation of the budget.
Indeed, budget performance has averaged 50 percent since the return of democratic rule. “..the release of capital budget implementation is less than 50 percent considering that not all the releases were cash-backed and not all cash-backed amounts were spent because of capacity problems of MDAs and late enactment of the Appropriation Bill,” says Mike Obadan, Economics professor at the University of Benin. The irony, according to experts, is that while the federal budget has tended to increase, budget implementation has seen a woeful decrease; with the attendant socio-economic consequences. Poor budget performance heightened under the late Umaru Yar’ Adua administration which directed that unused capital allocation be returned to the treasury. The delay in passage of the budget by the National Assembly has equally worsened budget performance.
The recent revelation by the Minister of Works, Mike Onolemenemen during the 2015 budget defence in the Senate that only N11.2 billion was allocated for capital expenditure by the Finance Ministry has sent tongues wagging. To worsen the matter, of the N98 billion allocated for capital projects in the 2014 budget, less than half, which is about N45 billion was released as at end December. Little wonder abandoned infrastructural projects litter the country. “…abandoned capital projects littered all over the country amount to over $50billion,” Professor Charles Soludo, former governor of the Central Bank of Nigeria (CBN) recently wrote in a critical piece that drew the ire of the government.
Even the works minister confirmed recently that several on-going projects in the country will suffer as only about 33 projects as against about 210 on-going projects were considered in the 2015 budget. According Onolemenemen, important projects such as the rehabilitation of the Lagos-Shagamu-Ibadan dual carriage way, Apapa-Oshodi Expressway, Enugu-Port Harcourt dual carriage way, dualisation of Obajana-Benin Expressway and Kano-Maiduguri expressway among others would stall due to the paltry capital allocation. Most disheartening is the zero allocation to the Federal Road Maintenance Agency (FERMA) which has the responsibility of fixing failed portions of federal roads in the country.
Indeed, as stated by the Works Minister, the budget performance of the ministry would have improved if the outstanding N53 billion had been released. He dropped the bomb-shell saying: “More importantly, if the cumulative outstanding budgeted funds of N203.29 billion for the period spanning 2011 to 2014 had been released, the total indebtedness would have been brought down from N230 billion to N27 billion.”
Senator Ayogu Eze, Chairman Senate Committee on Works wondered how a paltry N11 billion would be allocated to works when, in actual fact, several multiples of the allocated sums should have been budgeted annually to bridge the huge infrastructural gap in the country.
By Osaze Omoragbon
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