2013 budget: Experts worry about implementation

Posted by admin Budget, Latest Politics Thursday, October 11th, 2012

Economic and budgeting experts have expressed worries over the ability of the Federal Government to successfully implement the 2013 budget, which was presented to a joint session of the National Assembly on Wednesday, saying its performance on the current fiscal year leaves room for concern.

According to the experts, the government must ensure that it implements the 2013 budget in a way that will be felt by Nigerians.

The Chief Consultant, Supreme Management Training and Consultancy Services Limited, Mr. Yinka Fasuyi, said, “In presenting the 2013 budget, one would have expected an explicit performance review of the 2012 budget in terms of the projected outputs and outcomes.

“Even though the third quarter of the year has just ended, a good reporting on the performances of the 2012 budget as at the end of third quarter of 2012 will go a long way to build the confidence of the populace in whatever the President is presenting for 2013.”

“The issue of performance of the 2013 budget is very vital. Government should put in place a participatory budget performance monitoring and evaluation system, which will involve all critical stakeholders to periodically appraise and report on its performance,” Fasuyi added.

Jonathan, while presenting the budget estimates, said the Nigerian “economy had done relatively well,” despite the complaints from various quarters to the contrary.

The Chief Research Analyst, Stakes Capital, Mr. Sanyaolu Kehinde, said the size of the budget was not as important as what it could offer.

He said, “Like every budget, it is just a proposal. However, the size is not the basis; the most important thing is the things that constitute it. Another important thing is implementation. Just like the 2012 budget, can we say implementation has reached 50 per cent?

“Meanwhile, that budget is in favour of government spending. What we are likely going to see is a budget that is capital starved and more in favour of expenditure.”

On the crude oil benchmark price, Kehinde said the price could go either way.

“The lawmakers believe revenues received must be available for spending and harvesting. They believe it is raining today, so why keep the umbrella folded when there is a storm.

“The Presidency believes savings are essential for the rainy day. I think it is important to save more because it improves the sovereign credit rating of Nigeria.”

An economist and former Vice-Chancellor, Onabisi Onabanjo University, Ago Iwoye, Prof. Afolabi Soyede, said, “I may not be able to make informed comments on what was presented because I have yet to read what was contained in his (Jonathan’s) presentation.

“But the truth is that we still see a lot of people looking for jobs. Our roads are still not fair enough and many things are not working as expected. So, if I am to speak from this point of view, I will be downright castigating, but I don’t want to castigate.”

A former acting Head, Department of Economics, University of Lagos, Prof. Kayode Familoni, told one of our correspondents that the previous budget had not impacted enough on the masses.

He called on the government to put adequate measures in place to ensure the implementation of the 2013 budget, stressing that it would be a thing of shame if the government continued scoring itself high while Nigerians thought otherwise.

“There is nothing to celebrate when you consider the impact of the 2012 budget on the masses. The poverty level in Nigeria has not improved; so, the government should continue to try harder to make sure the 2013 budget is focused and is implemented to the letter,” Familoni said.

Meanwhile, the Regional Head of Research, Africa, Standard Chartered Bank, Ms Razia Khan, said on all the key metrics, markets were likely to interpret the budget positively.

She said, “First, spending is set to rise to N4.93tn in 2013, from N4.697tn previously. This five per cent year-on-year rise in spending is relatively modest and compares extremely favourably with the magnitude of spending increase that we had seen. In real terms, it signals the ongoing attempt to achieve fiscal consolidation.

“Second, the make-up of that spending is more encouraging as well. The share of recurrent spending falls to 68.7 per cent of the budget, from 71.47 per cent previously. It is a further step in the right direction and indicative of the authorities’ desire to gradually boost the share of capital expenditure.

“Third, the adoption of a $75 benchmark assumption is still relatively positive. Of greater concern is the suggestion that there might be an attempt by the House (of Representatives) to raise this to $80. In our view, given global risks, and Nigeria’s ongoing fiscal and export dependency on a single commodity, the priority for Nigeria has got to be increasing its rate of savings. Were oil prices to fall, Nigeria would currently be left very vulnerable, with no sound mechanism for being able to smooth spending, let alone provide a counter-cyclical boost to the economy.”

-Punchwp_posts