Thursday, April 17, 2014

Jonathan rejects transparency clause in 2013 budget; asks N’Assembly not to monitor budget spendings

Published:

President Goodluck Jonathan laying the 2013 budget before the National Assembly

President Goodluck Jonathan has rejected a number of ambitious stipulations in the Budget Act allowing the Senate and the House of Representatives to monitor every kobo disbursed by the executive for project execution, a design federal lawmakers hatched to check the perennial problem of poor budget implementation.

Mr. Jonathan said the unprecedented clauses, inserted by both chambers into the 2012 budget law after repeatedly complaining about their frustration with dismal budget performance, will encroach on his powers and that of the executive.

In a letter to the National Assembly Tuesday, the president called for immediate review.

“The 2013 Appropriation Act includes some clauses which may be injurious to the spirit of separation of powers and which could hamper the work of the executive arm of government. I, therefore, request that these should be reviewed,” the president said.

The lawmakers had included in its approval of the budget clause 6(2), which demands that the Accountant-General of the Federation, AGF, forward to the National Assembly full details of all funds released to Ministries, Departments and Agencies immediately such funds are released.

If effective, Clause 6(2), more than any other, would allowed a very close monitoring of government spending. But Mr. Jonathan has rejected the move citing separation of powers.

A follow up clause directs that the Minister of Finance release funds periodically as due to offices involved, and failures can only be entertained with the due permission of the National Assembly.

The president said that was impossible since revenues fluctuate and might necessitate budgetary defaults.

“This requires the minister of Finance to seek a waiver from the National Assembly each time the ministry of Finance cannot make full fund releases to the MDAs when due. As you are aware, the nation experiences a shortfall in revenue once in a while and if the minister is to seek a waiver on each occasion, the practice would tie down budget implementation,” he said.

It is not clear whether the lawmakers will oblige Mr. Jonathan.

But the president’s request for change, sent alongside a number of amendments to the 2012 budget, appears to highlight the president’s concern about having the executive’s often criticized unapproved spending, curtailed.

In 2012, lawmakers noted several unbudgeted spending by ministries, departments and parastatals-many of the cash used for those spendings came from internally generated revenue.

Under the president, the cost of petrol subsidy surged consistently more than approved by the National Assembly, peaking at more than N2 trillion in 2011 against the N256 billion budgeted.

But most frustrating to the lawmakers has been the consistent poor implementation of the federal budget, and complaints about refusal by the Ministry of Finance to make fund releases to respective government establishments.

The clauses were amongst a number of reviews by the lawmakers to the budget, a reason the president refused to sign the passed document for months. Others were the oil price benchmark and spending adjustments.

Mr. Jonathan recently signed the budget after extracting the assurances of the two arms of the National Assembly that should he sign the budget, the legislators will approve an immediate follow-up amendment he would send to lawmakers.

The president forwarded the amendment on Tuesday. Alongside other requests, he asked the two arms to reverse the zero allocation to the Security and Exchange Commission, SEC, saying withholding the agency’s funds would affect the capital market.

Mr. Jonathan said the decision to withhold the commission’s budget “tantamount to shutting down the business of the commission with a potential negative impact on the capital market”.

In the amendment the president has requested, N273, 522 billion is to be allocated to the Subsidy Reinvestment programme which lawmakers had earlier dismissed as a scam.

Extra N4 billion is for the East-West road increment, N13 billion for Abuja-Lokoja road, N31.5 billion for Benin-Ore-Sagamu road, an additional N7 billion for Kano-Maiduguri dualisation, N7billion for Port-Harcourt-Enugu-Onitsha road, N7 billion counterpart funding for second Niger bridge and N10 billion for Oweto bridge in Benue State.

Proposed allocation to the Ministry of Transport is N77 billion for Lagos-Kano-Port Harcourt-Maiduguri-Kaduna-Abuja rail project, bringing the total to N213,190 billion.

For social safety nets and infrastructure projects, maternal and child health was allocated  N16.9 billion, public works for youth N27 billion, mass transit N6 billion, vocational training N8.6 billion and culture and tourism, N224  million.

Other include N1 billion for the board of Subsidy Reinvestment and Empowerment Programme and N500 million for monitoring and evaluation, bringing the total expenditure to N273,522 billion.

 

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