By Oscarline Onwuemenyi & Inalegwu Shaibu
Chairman of the House of Representatives Committee on Finance, Mr John Enoh, has said the National Assembly has a lot of lessons to learn from the on-going controversy over comments by the Governor of the Central Bank of Nigeria, CBN, Mallam Sanusi Lamido Sanusi, on the rising costs of overheads incurred by the legislators.
This is against the backdrop that President Goodluck Jonathan will next week, present the 2011 budget estimate to the National Assembly.
Enoh, who spoke Thursday at the 2nd Economic Policy and Fiscal Strategy Seminar organised by the Centre for the Study of the Economies of Africa, CSEA, in Abuja, said although the National Assembly members found it “hard to believe the figures bandied in the public space, however, it was a wake up call on the general society to change their ways and their attitudes.
“There are lessons to learn on both sides from the recent controversy between the CBN governor and lawmakers, and the country will be the better for it.
“I personally do not believe what the CBN Governor said about the amount of overhead and other recurrent expenditures of the National Assembly, but I hope that it would mark a new beginning in our relationship with the Executive as regards what role we play in the preparation of the budget.
“We agree that there is every need for a review of our systems, and I have been talking to my colleagues in the House on how we can sustain the present system.”
Enoh argued that the National Assembly was not only to blame over the purportedly bloated pay package it receives, but that it was a collective challenge for every citizen.
“The budget process is a challenge that everybody must appreciate. The National Assembly is not the only challenge. It is systemic matter. The process stipulated in the fiscal responsibility law is not followed closely,” he said.
He noted that the figures quoted by the CBN Governor were “incredulous and incorrect,” adding that at Sanusi’s presentation to the joint House Committees, “N536 billion changed to N814 billion.”
If at N536billion it is 25 percent, if it is N814billion, the figure would be different,” he argued.
According to him, “The 2010 budget has an aggregate expenditure figure of more than N5trillion, and if the memorandum items are included, it will get close to N6trillion. It has capital component of N1.7trillion, and a recurrent figure of N1.3trillion as well as overhead of N536billion and service_wide votes of more than N600billion.
“It is not the percentage of the allocation, as much as the structure of the budget and how well the operators are doing that is important. If N1.7trillion is allocated for capital projects in 2010, and by the end of the year N1.7trillion is spent in the economy, we will do better as a country.
“The real problem, in addition to restructuring the budget is that even the capital should be spent well to create impact in the lives of the people,” Enoh added.
Enoh noted that investigations by the House committees over the course of five years revealed that about N3trillion has been collected by various agencies and not remitted to the coffers of government.
“What we found out was that the more agencies of government are able to generate revenues, the more they increase their expenditure,” he stated.
He noted that last Wednesday the House of Representatives passed the Medium term expenditure framework that would guide the preparation of next year’s budget
“We had agreed with the Ministry of Finance that oil price benchmark for 2011 should be $65 per barrel, and when members saw that oil price rose to about $90 per barrel, they could not understand, because of the requirement in the Constitution that all oil revenues must be paid in the Federation Account.
“The indiscriminate way the money in the Excess Crude Account is spent does not help matters. It is not about the issue of the National Assembly alone, but about all stakeholders and Nigerians to amend the constitution to take care of the fine point on how to manage such matters.”
He noted after 12 years into the practice of democracy, the nation was come to terms with the question about who owns the budget process between the Executive and the legislature.
He said, “The issue is to what extent is the National Assembly engaged by the Executive in the process of preparing the budget, though the lawmakers sometimes unprofessionally add or drop figures in estimates submitted for appropriation without regard of what it takes to do the project in the next year.”
The House Committee Chairman said the issue was not about the expansionary figure, but whether it is being used for the work it was supposed to be done. “If such monies have been put into productive purposes, there would be an impetus for growth of the economy, which will make up for a GDP ratio that is unsustainable.
“We must get these things right. If in a particular year, the budget is before the NASS as required, members would have enough time to look at all issues before passing.
“The Budget office, Ministry of Finance and all those involved in the budget process need a lot more engagement to get the NASS to appreciate what damage they could be causing the budget if the rules are not followed.”
Meanwhile, the Director General of Budget Office of the Federation, Dr. Bright Okogwu, has blamed state governments for the
He said, “Fiscal federalism is a difficult to operate in an environment such as ours. We conceptualized the Fiscal Responsibility Bill, which eventually came into law. Under that process more robust legislation was drafted
“Unfortunately at the National Assembly, the state governments said the Federal Government could not make a law for the states, and they watered down several sections of the Bill, such that what was eventually passed was significantly different from the original conception.
“The deterioration in the fiscal discipline in recent times could be attributed partly to the insistence by the states on the constitution; that all monies collected must be paid into the Federation Accounts. They even said the Excess Crude Account was an illegality, because the money belongs to them, and they should be allowed to share it as and when they feel they needed to.
“But, what we have resorted to over the period is to try to talk to them to appreciate to understand the need to comply.”
He noted there was need for a comprehensive amendment of the constitution to make the budgeting process more efficient and performance based.
“There is a section that says that if the executive is not happy with the budget that comes from the Assembly after appropriation, after 30 days, they can override that section in contention by simply going ahead to consider the budget as properly appropriated, and it will become an Act of Parliament.
“In the 2010 budget, it was submitted up to a certain limit of spending (N4.2trillion), which government thought was already too high. When it came the Budget Office, N4.6 trillion was in the Bill.
“When we saw the details of the budget, the figure became even higher at N4.85trillion. we had to work with the National Assembly to try to restructure and reconcile the figures. When one has that kind of situation or environment, it is inevitable that one would have some of the expansionary numbers referred to. By continuous consultation, we believe we will get it right.”
Okogu also lashed out at MDAs, noting that they pay too much attention on how much money is allocated to them for their sector, rather than attention to what they would do with the money and the value they would deliver to the people.
According to him, “The budget process has been delayed over and over again, because the MDAs say they do not like the envelope system, which promotes the principle of prioritizing projects and programmes based on available resources. MDAs, Ministers, Permanent Secretaries, Directors often go ahead to seek a bigger allocation from the National Assembly.”
Although President Jonathan in his letter to the Senate president, David Mark requested the National Assembly to grant him audience at 12 noon of Tuesday, 14th December, 2010 to present the 2011 budget to both the Senate and House of Representative at a joint session, it was gathered that the final decision on when the session would hold lies with the two chambers of the national assembly.
The letter reads, “I crave the indulgence of the National Assembly to grant me the slot of 12:00 noon, Tuesday, December 14, 2010 to formally address the Joint Session of the National Assembly on Budget 2011.”
President Jonathan’s letter is coming on the heels of worries expressed by the senate over the delay in the presentation of the 2011 budget by the President.
Spokesman of the Senate, Senator Ayogu Eze had expressed reservations on the delay in the budget presentation saying it may delay the implementation process.
He had said on Wednesday that ‘We are surprised that this is December, we have not received the budget for 2011. When this budget process starts and we try to do a thorough job to examine what the MDAs are going to spend the money on, I am sure Nigerians will come on us and start shouting that the National Assembly is delaying the budget.
“But nobody is asking question why not the budget has been presented. this budget ought to have been here but it is not here and we cannot speak for the Minister of Finance on why they have not brought the budget and when they bring the budget we will start working on it.”
In another letter to the senate, President Jonathan urged the Senators to expedite action on the Nigeria Sovereign Investment Authority bill which is meant to provide savings for future generation of Nigerians.
The letter reads, “I forward herewith, for your kind consideration and passage into law, a Bill for an act to establish the Nigeria Sovereign Investment Authority to build a saving base for future generations, enhance development of the infrastructure sector in Nigeria, and assist fiscal stability in certain circumstances.”