After being initially stigmatised in the “missing budget” saga, the 2016 Appropriation Bill, which is being tooth-combed for passage by the National Assembly, if properly implemented, could revive the economy and rapidly exit Nigeria, for the first time since the civil war, from being a hostage to crude oil.
Most economic analysts see Buhari’s first budget as an elected President as a recourse to the Keynesian model, whereby instruments of bailouts and massive spending are used to snatch sagging economies from the mouth of recession and possible depression.
The People’s Democratic Party (PDP) administration rode the 2008 economic meltdown by creating the Assets Management Company of Nigeria (AMCON ) to bailout heavily indebted banks and businesses but wound up being owed over five trillion naira. Buhari seeks, instead, to “bailout the poor and most vulnerable” with the N500 billion voted for conditional cash transfers, school feeding programme and training of 500,000 teachers to put new life in our educational system.
Government hopes, through this spending, to inject money into the system and create opportunities for those who will provide goods and services for the programmes.
Another ambitious aspect of the budget is the proposed heavy investment in infrastructure. The sum of 433.4 billion is allocated to the Power, Works and Housing Ministry to execute capital projects, while its Transport counterpart will spend 202 billion, part of which could involve the floating of a new aviation national carrier.
The FG also intends to liberalise the solid minerals sector and allow states and private individuals, within the limits of extant laws, to participate in the exploitation of abundant resources in that sector.
These are quite innovative, but a lot depends on how the approved budget will look like when the legislature is done with it, and how closely the Federal Government will implement it. Fears are being entertained that the steep drop of oil prices could go against it. Federal lawmakers from the opposition PDP have also argued that this budget might plunge this country back to the era of heavy indebtedness from which the Obasanjo regime exited the country through debt swap.
W e call on President Buhari and the ruling APC to eschew unnecessary distractions, which have bedevilled governance since they came to power over eight months ago. The 2016 budget carries a lot of innovations and it will take a focused regime to successfully deliver it.
Happily, the war on corruption is proceeding apace. The Treasury Single Account (TSA) is being smoothly implemented, while the Integrated Personal and Payroll Information System (IPPIS) is being used to plug corrupt revenue drain.
Successful implementation of the 2016 budget is a major test for Buhari which, we hope, he will pass.