October 15, 2015

Salvaging the 2015 budget

ANXIETY over the economy has not abated even as both the Presidency and the Senate appear to be ready to put in place the federal cabinet and by extension the economic team of President Muhammadu Buhari’s government.

Economy analysts heaved a sigh of relief when the first batch of ministers was submitted to the Senate on Thursday, September 30, 2015 after four months of long-drawn anxiety as to the direction and character of the economy being contemplated by the new regime.

A key factor of interest is the regime’s lacklustre attitude to the budgetary and fiscal policy 2015/2016 left behind by the previous regime. While most stakeholders appear to have resigned to fate that 2015 budget is lost, every one of them is worried that 2016 is also looking bleak since nothing is being said by government less than three months to the new year.

Due to the long processes involved in the making of the federal annual budget, actions on the upcoming year’s budget usually start as early as July culminating in the presentation of the Appropriation Bill to the National Assembly by latest November.

Economists are concerned that at the pace of the current regime, the 2016 Appropriation Bill may not get to the National Assembly this year; a development which would worsen the economic decline recorded in 2015. No one even knows when the ministers in charge of the economy will start work.

Both local and foreign investors have blamed the currently depressed macro-economic indicators on the inability of the government to define its economic direction. They are waiting anxiously for the government to clarify the fate of this year’s budget and pave the way to that of next year. We expect that this should be the first things the next ministers in charge of the economy must attend to.

We expect the Budget Office and the Finance Ministry to be on this assignment as we await the resumption of the minister in order to fast track the process.

Budgetary pronouncements would galvanise positive sentiments in the minds of investors and the commercial class and stimulate economic activities as soon as possible.

It is noteworthy that a similar swift statement by the Ministry jointly with the Central Bank of Nigeria (CBN) and the Debt Management Office (DMO) in the wake of the withdrawal of JP Morgan Index had saved the economy massive cash run.

The economy has grown weary of tension and depending mainly on speculations and the president’s “body language”.

We want the federal government to be up and running, and see what it can do to salvage this year’s Appropriation Law. Otherwise the year might pass without the budget being implemented at all.