Four months after the budget proposals were submitted to the National Assembly and one month after the lawmakers passed the estimates with adjustments, the 2012 Appropriation bill has now become law.
President Goodluck Jonathan yesterday signed the 2012 Appropriation Bill into law, but
He threatened to sack any head of parastatal who engages in lobbying the National Assembly to increase the 2012 budgetary provisions which he said distorts budget implementation and therefore, attainment of targets and development.
The 2012 budget is to the tune of N4.7 trillion.
President Jonathan said security reports at his disposal indicted some heads of parastatals whom he promised to use as scapegoats to prove to others that government would no longer tolerate a situation where people branzenly influenced the inclusion of figures not considered and captured during budget preparations.
He warned that no family, organisation or country can develop or make progress without planning, pointing out that since his stint in office, he had realised that the greatest impediment to development was the fact that the federal government budget was not always based on proper planning, as figures released by the ministries of planning and finance end up being distorted along the line.
The President said: “I will continue to plead with the National Assembly that if there are heads of parastatals that come to you to lobby, drive them away. This year we clearly frown on it and I am going to use some heads of parastatals, because I got security report that they came to lobby for their budgets to be increased, as examples.
“I will ask them to leave because we cannot run a country without planning; we cannot run a budget that is not based on planning. These figures don't just come from the blues, people sat down and compute and see how it fits into fiscal responsibility and other issues. So we will not allow a situation where one person, because of personal interest, will distort the budget of a nation.
He explained that the late passage of the 2012 budget was due to the changes in the cabinet, the appointment of new ministers and other programmes that he described as choking.
Jonathan said to guard against late budgeting; MDAs will have to defend their 2013 budgets between May and June so that between July and August they would have been through while he would be submitting the appropriation bill to the National Assembly in September.
That way, he explained, the National Assembly would have sufficient time to have robust debates and inputs into the budget and have it passed on time to make implementation to commence in January and end in December.
He said he would no longer allow extension of budgetary periods into the New Year.
He recalled submitting a budget proposal of N4.479 trillion on December 13, 2011 for the 2012 budget with the oil benchmark set at $70 a barrel.
The initial budget, he continued, had a capital budget of N1.32 trillion and a recurrent of N3.429 trillion in the hope that the planned full deregulation of the downstream petroleum sector would commence. However, he said this had to change as he listened to the protesting voices of Nigerians and a partial removal of subsidy on petrol was adopted.
Even at that, Jonathan said his administration had to review the revenue and expenditure profile of the budget to make provision for N888 billion fuel subsidy in the budget.
He said on March 15, the National Assembly adjusted the benchmark to $72 dollars and passed a budget of N4.697 trillion with N1.34 trillion capital for capital and N3.357 trillion for recurrent expenditure, a situation that he admitted led to lengthy discussions that produced the budget.
“The budget has an aggregate expenditure of N4.697 trillion (excluding the appropriation of N180 billion for programmes and projects encapsulated under the SURE progamme). The total Federal Government revenue forecast is N3.561 trillion based on a benchmark oil price of US$72 per barrel, which is US$2 higher than the initial proposal of US$70 per barrel. The additional resources were used to increase the capital and to reduce the deficit to a manageable level that we can finance without excessive borrowing.
Jonathan gave the details of the expenditure as follows:
“Capital Expenditure is N1.34 trillion, which is 28.5 per cent of the aggregate expenditure. One of the main goals of this administration is to complete and exit the large stock of on-going projects and programmes. Thus, the 2012 budget is focused on completing viable on-going projects, in accordance with the Transformation Agenda, which will quickly deliver tangible and significant added value to Nigerians.
“Non-debt Recurrent Expenditure is at N2.425 trillion, which is 52 per cent of the total budget compared to 54 per cent of the aggregate budget in 2011. This is in line with Government’s determination to correct the structural imbalance in our expenditure profile where recurrent spending has outstripped the growth of spending on capital projects in recent times. Statutory Transfers is N372.59 billion.
“Based on the above and in line with Government’s medium-term strategy, the share of the recurrent spending in aggregate expenditure has declined from 74.4 per cent in 2011 to 71.5 per cent in 2012. The deficit is 2.85 per cent of GDP, which is in line with the provisions of the Fiscal Responsibility Act, 2007, which pegs this at 3 per cent of GDP.”
He said the gains so far made in the economy through strict implementation of policies had led to improved living standards of the people and that his drive was to focus on investments that will lead to sustained economic growth and create jobs.
By Ahamefula Ogbu in Abuja