BY UDEME CLEMENT
After what could be described as exhaustive debate and thorough scrutiny, the Senate and House of Representative finally endorsed N4.6 trillion budget, being the total financial package proposed by the Federal Government for 2010 fiscal year. Approval for the much-talked about budget came on the heels of the declaration by government to grant refineries autonomy to operate independently with a view to enhancing capacity utilisation to boost crude oil production in the country.
TOTAL BREAK-DOWN OF
The total financial statement of N4,608, 676,276, 213 trillion, for the economic year is made up of capital expenditure of N1, 853,906,761,420 trillion, while recurrent expenditure is put at N2, 077, 358, 560, 347 trillion.Â N497,071,797,452 billion is the amount appropriated for debt servicing while N180,279,158,994 billion is reserved for statutory transfers.Â The budget is pegged on a benchmark of $67 per barrel of crude oil production capacity of 2.35 million barrels per day with an exchange rate of N150 per dollar.
Accordingly, the 2010 budget also gives priority for infrastructural development in the country, with N1.85 trillion, which is 40 per cent of the total budget for capital expenditure. Thus, going by the previous records on financial appropriations in Nigeria , the current budget is the highest proportion earmarked for capital development since the return to democratic rule in 1999.
This financial document shows a great disparity between what the present government wants to achieve in terms of social-economic development and what was obtainable in the past. But the questions begging for answers are, can N1.85trillion boost infrastructural development in the country, considering the level of deficiency in the industrial sector of the economy? When would budget for capital expenditure be higher than what is required for other services in Nigeria ?
Judging from the above financial analysis, the 2010 budget, with N1.853,906,761,420trillion for capital expenditure, is a clear indication that government would spend more money in paying salaries and other services than capital investments in the economy.
This, according to experts, has serious economic implication because economic growth and development, especially for a third world country like Nigeria requires huge investments in various sectors.
The experts believe that tangible investments must be on ground for government to achieve more income flow in the economy and relative full employment, since absolute employment is not attainable in any economy no matter the level of growth. They are also of the opinion that more money ought to have been appropriated for capital expenditure to foster industrial development with a view to propelling economic growth in the long-run.
A member of the Upper House, Senator Abubakar Umar Gada, also the Vice Chairman, Senate Committee on Downstream Petroleum, told Sunday Vanguard that immediate passage of the budget became imperative to boost infrastructural development and continuity in governmentâ€™s policies. â€œWe want the nation to move forward. Ultimately, we want economic growth and development. So, for us to achieve these objectives, the budget must be passed on time to ensure projects execution at the three tiers of governmentâ€, he enthused.
However, most manufacturers are of the opinion that sufficient funds should be put into the energy sector to solve the perennial power crisis that is almost crippling every sector of the economy, especially manufacturing. This implies completion of power projects across the country and adequate gas supply to power the plants.