These are critical times. Nigeria has never been in a situation like this in my life time. Apart from the period of the civil war, this is the most critical time to be a Nigerian. Our resources have been mismanaged and now we are broke! Our people are being killed not just by extremists but also by the very government that swore to protect lives and property. This piece is about the 2012 budget and its sad realities.
1. The budget of N4.749 trillion assumes an oil price benchmark of $70 a barrel, oil production of 2.45 million barrels per day and zero deduction from Federation Revenues for the fuel subsidy.
2. Despite the above assumptions, the budget contains a deficit of 2.77% of GDP. (The nominal GDP has been estimated by National Bureau of Statistics (NBS) to be about N36 trillion in 2011), so essentially about N1 trillion of the budget is to be borrowed, or relies on exceptional income like privatization proceeds, loans and grants-in-aid.3. Accordingly, out of the capital budget proposal of N1.32 trillion, only about N300 billion will be available from our federal revenues. If the “subsidy” is not withdrawn, the deficit will be even higher and the FG would then contravene the 3% cap on deficit in the Fiscal Responsibility Act 2007.
4. None of the so-called SURE projects have any NEW source of revenue to finance them other than what have been described above UNLESS:
(1) the oil price benchmark is raised above $70 or
(2) the Naira-Dollar exchange rate allowed to slide thus raising more Naira for the government.
The above assumptions are far-fetched in the current global economy.
Some examples of wasteful spending decisions are itemized below:
5. A review of the budget provisions of 21 out of 50 Ministries, Departments and Agencies revealed the following amounts for some recurrent and capital expenditure items:
• Travel – local and international N13 billion
• Stationery, Magazines, Newspapers, etc. N4.5 billion
• Maintenance of vehicles, furniture, etc. N17 billion
• Training N5 billion
• Fuel and Lubricants for cars, generators, etc N4 billion
• Miscellaneous: welfare packages, refreshments, meals, etc N9 billion.
• Acquisition of Computer Software N2.5 billion.
• Research and Development: whatever that means! N27 billion.
6. The actual provisions in the budget would be at least twice these amounts, and total about N160 billion of waste. This amount is equal to the amount budgeted for the power sector!
7. Some examples of some of the wasteful spending under “Research & Development” are N2.498 billion for “citizen’s call centres” under the Ministry of Communications & Technology, N1.2 billion in the Ministry of Agriculture to incorporate commodity marketing companies! The Ministry of Foreign Affairs wants to spend N322 million to acquire “computer software”. This is very expensive software indeed!
8. A lot has already been written about the budgets in the Presidency. The following are some weird examples of what has been included in the State House (Villa) budget.
9. Overhead is about N7.2 billion, or about N20 million per day to keep our President and VP happy. Their local travel budget is N724 million or N2 million per day, including weekends, while their international travel budget ix N951 million or nearly N3 million per day.
10. The president’s office has N285 million to hand out as “welfare package”, N265 million to buy computers, N150 million to buy scanners, N161 million for buses, N295 million for new furniture, and N1.8 billion to “maintain existing furniture, office and residential quarters”.
11. They intend to buy desktops for N300,000 each, laptops for N314,000 each and scanners for a whopping N190,000. The public address system in the President, VP’s office and Banquet Hall will cost N150 million! The SGF wants to spend N65 million on tree planting. Note that planting a million trees in Abuja over 4 years cost the FCT Administration less than N50 million then!
Conclusion: There is a lot of waste, and misplaced spending priorities in the Budget which can be reviewed to free more funds to finance subsidies, capital investment and improved governance. Do you remember #budgetscam? This is worse than that!
Now you know why government doesn’t mind killing all of us because they will not free funds from the loots of their corrupt friends, they will not cut their salaries and allowances and they will not reduce their number of aides. Instead of all that, they’d rather hurt Nigerians by all means possible.
You can share this information with as many people as possible. Information has proven useful in this struggle.
#OccupyNigeria we will not tire, we will not falter, we will not fail.
Originally posted on omojuwa.com