By Gabriel Ewepu – Abuja
Social justice and non-governmental organization, ActionAid Nigeria, AAN, Thursday, expressed concern over implications of 2020 Budget cut on health, education, and agriculture sectors.
The concern was raised after the critical assessment was made on the budget cut by the AAN as it touches these sectors considered to be critical to the lives of Nigerians and Nigeria’s socio-economic development, which was contained in a letter addressed to the President of the Senate, Ahmad Lawan, with the subject ‘Budget Reality: X-Raying the Implication of the Cuts in the 2020 Budget on Key Sectors, Health, Education and Agriculture Amidst COVID-19 Pandemic’ and signed by the Country Director, AAN, Ene Obi, and made available to Vanguard.
The letter made observations on the budget cut which include; an anticipated loss in revenue from oil due to the Covid-19 pandemic, which may render Nigeria incapable of meeting her 2020 revenue targets. This has necessitated a budget cut; A budget deficit of 5.365 trillion is expected to be funded through loans from the IMF, AFDB, and other institutions.
It is projected that by 2021, 75% of Nigerian revenue will be channeled towards offsetting debts accrued. With the dwindling revenue occasioned by falling oil prices, non-remittances, leakages, etc, the tendency that borrowing will continue in 2020 to fund the budget is likely. This is a major concern as the debt profile keeps pilling and to substantiate this, the Debt Management Office (DMO) showcases the nation’s total debt stock at N27,401,381.29 ($84,053.32b) as at December 31st 20194.
The Health, Education and Agricultural sectors were grossly underfunded in the 2020 budget and further cuts may prove detrimental; The Federal Government has facilitated a 1.2 billion dollars loan from the Brazilian government for the mechanization of agriculture across 632 Local Government Areas in Nigeria; As reported by the World Poverty Clock, Nigeria has overtaken India as the poverty capital of the world and the most vulnerable groups include women and children.
Nigeria currently has the highest rate of maternal mortality in Africa second only to India in the world. 15% of Child Mortality rates in the world accrue from Nigeria also; A worldwide food production disruption for 24-36 months is imminent. There is an urgent need to channel more citizens and resources into food production, through value chain development.
AAN in the letter made some recommendations and reads in part, “ActionAid Nigeria, an affiliate member of the ActionAid International with presence in 45 countries, has been advocating for increased budgetary allocation to key sectors, such as Agriculture, Health and Education sectors given their strategic importance. Agriculture employs up to 80% of the population, especially in the informal sector, where the majority of the small-scale food producers are women farmers.
“Financial incisiveness should be encouraged through increased access to credit by the small scale farmers. Similarly, improved funding of the education sector will minimize the incessant strikes in our public institutions, enhance the quality of education, learning, and provision of infrastructures at our basic, secondary, and tertiary institutions.
“Furthermore, the emergent of the COVID-19 pandemic has really exposed the fragility of our health sector at all levels, signify long years of negligence of investment in public health infrastructure. The health sector requires improved funding, our health centers, maternities, and hospitals lack basic essential facilities and drugs.
“Overall, evidence has shown that increased investment in these pro-poor sectors has a strong impact on poverty and inequality reduction, while simultaneously creating employment opportunities.
“Ministries, Departments & Agencies (MDAs) should adopt a bottom-up approach to budget creation. States and Local Governments should aggregate their own budgets, to exact deeper developmental impact in the rural communities. Above all, the budgetary process should be participatory and encompassing
“The budget allocations in the 2020 budget to these 3 key sectors should not be reduced further in the ongoing budget review, given that they are already very insignificant, falling below the international benchmarks, eg. For agriculture, the international recommended benchmark is 10%, according to the AU 2003 Maputo Declaration.
“Unfortunately for Nigeria, Agricultural allocation is a mere 1.73%, health 4.16% and education 7.54%. Further reduction will exacerbate poverty and inequality in the country.
“The Brazilian model for increased agricultural productivity should be embraced in its entirety. Adequate provisions should be made for small scale farmers, gender-friendly tools should be prioritized, and resources should be properly utilized to increase production, processing, and marketing for smallholder farmers.
“A coordinated framework should be established to ensure that funds allocated to Health, Education, and Agriculture are properly administered, ensuring value for money and an integrated approach.
“The budget should be devoid of vague and abstract terms, the budget information should be complete and concise. All allocations should be channeled towards concrete deliverables, targeting human and infrastructural development.
“The Nigerian Government should enhance its capacity to offset loans before obtaining more of the same. Furthermore, loans should not be used for recurrent expenditures eg. to pay salaries, traveling allowances, etc.
“The allocation to the National Assembly should be reduced and all excesses channeled towards enhancing the Health, Education and Agricultural sectors. This compares the percentage allocation to the NASS, given its size and the allocations to the 3 key sectors in the discussion.
“Key ministries should be part of the ongoing white paper process to be deployed post-COVID-19. It entails a new strategy to be developed on the current reality, looking at the changing environment and dwindling resources occasioned by the COVID 19 pandemic.
“Extra care should be taken to ensure that the amended budget does not contain duplicated expenditures across MDAs. There is a need to ensure that releases are timely, reaching the federal MDAs in the periphery not just those in FCT and the major cities, and simultaneously ensuring that there is a Budget tracking and performance assessment mechanism instituted.”
However, AAN acknowledged the impact of the novel Coronavirus, COVID-19, pandemic has made on global economy life and commended unrelenting efforts by the government at different levels to contain the spread of the virus.