Financial experts and civil society activists have condemned the huge allocations to recurrent expenditure in the 2014 budget presented to the National Assembly last week. When she was appointed in 2011, Coordinating Minister for the Economy and Minister of Finance, Ngozi Okonjo-Iweala promised Nigerians that the percentage of capital votes will gradually increase towards 2015. It has rather worsened with the 2014 estimates.
Many have described the 72 per cent recurrent proposal for 2014 as lacking direction and incapable of addressing critical needs of the country.
Despite proposing N3.7 trillion or 72 per cent of the N4.6 trillion estimates to recurrent and N1.1 trillion to capital, Okonjo-Iweala still insisted the budget would focus on job creation and inclusive growth.
Managing Director, APT Securities and Funds Ltd. Malam Garba Kurfi, said the economy would not grow with less emphasis on capital expenditure.
Kurfi said the challenges of infrastructure would not be addressed with N1.1 trillion earmarked for capital projects.
According to him, the nation needed capital expenditure for the economy to experience meaningful growth and development.
He also said that the oil benchmark of 77.7 dollars per barrel should have been 80 dollars per barrel since there are no indications that prices would drop.
Also, Managing Director, Standard Union Securities Ltd. Mr Sehinde Adenagbe, frowned at late presentation of the budget and called for its quick passage since the national budget is the “road map for economic activities”.
He said companies needed the budget for decision making on investments.
Managing Director of HJ Trust & Investment Ltd. Mr Harrison Owoh observed that the budget proposal failed to address critical sectors of the economy and declared that it was disheartening that the bulk of the nation’s budget would be used for wage payment instead of capital projects.
He said that the federal government should be bothered by the sufferings of the masses by ensuring the provision of basic social amenities.
Executive Director, Civil Society Legislative and Advocacy Centre (CISLAC) Auwal Musa Rafsanjani said there is no way allocating 27 percent to capital expenditure, which is the special area where jobs and infrastructural development will ensure growth.
“It is not a budget that will create jobs; it is not a budget that will alleviate poverty but a budget for sharing money and looting as usual. I cannot understand how sensitive areas like health, agriculture and water resources are not given top priority in the budget,” Rafsanjani told Daily Trust in an interview.
“It is clearly meant for looting; for some people to ‘legitimately’ steal these monies…It is not a budget that will support the economy in any way.”
Aligning with the trend of reasoning, Association of Professional Bodies of Nigeria (APBN) expressed concern that the 2014 national budget was too much skewed to make meaningful impact on the lives of most Nigerians.
President of the association, Mr Bala Ka’oje, said in an interview in Lagos that only seven per cent of the N14.6 trillion proposed in the budget was earmarked for capital development.
“APBN has checked and analysed the whole thing and have came out with a position on the 2014 budget.
With a bench mark of 77.5 dollars per barrel and only 7 per cent of the budget for capital development, it means a whopping 73 per cent is for recurrent expenditure. Budgeting in this way does not give room for any meaningful development of the nation”, he said.
Ka’oje said that setting aside of N13.5 trillion for recurrent expenditure meant that only 2 per cent of the population would benefit from the budget.
He noted that the 2013 budget was also “structured in that way’’.
He noted that continued structuring of the nation’s budget toward recurrent spending will impact negatively on the common man.
“The National Assembly should kindly look into this recurrent issue critically. It has become a recurrent decimal in Nigeria, whereby you have a very huge recurrent and nothing for capital, which is not a good, balanced budget,” he said.
He said that the common man would benefit the more from a balanced budget especially when driven by employment opportunities.
Ka’oje said more funds should be allocated to boost agriculture, housing and health care infrastructure to generate employment and empower Nigerians at the grassroots and advised the Federal Government to block areas of leakages in the system and ensure that revenues accruable into the Federation Account were captured.