Legislative Approval for 2014 Federal Budget

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Maccido

At last, both the Senate and House of Representatives pass  the 2014 budget after waltzing through many hurdles and  political landmines laid for the budget by some members of the opposition

|  By Vincent Nzemeke  |  Apr. 21, 2014 @ 01:00 GMT

AFTER months of dilly-dallying,  both the Senate and the House of Representatives have finally passed the 2014 Appropriation Bill of N4, 695, 190 trillion . The Senate passed the bill on Wednesday April 9 and the House concurred the following day, on Thursday, April 10.

According to budget, N2,454,887,566,702 trillion was for recurrent expenditure, N1,119,614,631,407 trillion was for capital expenditure while N408,687,801,891 billion was for statutory transfer and N712 billion for debt servicing.

Jonathan
Jonathan

There is also a Subsidy Reinvestment Programme component of the budget to the tune of N268,370,000,000 for the year 2014, which did not form part of the aggregate budget figure of N4.6429 trillion but was captured in the final compilation of the Bill.

Presenting his lead debate on Wednesday, Ahmad Macido, chairman of the Senate joint committee on finance and appropriation, explained that in preparing the details of the Bill, his committee adopted a benchmark price of $77.50 per barrel of crude oil, a crude oil production of 2.38m barrels per day and an exchange rate of N160 to $1.

Macido said his committee observed that the 2014-2016 Medium Term Expenditure Framework and Fiscal Strategy Paper, upon which the 2014 budget was based, just like the previous editions, would require being refined and re- tooled both in procedure and process. He noted that a major issue was in the planning required and the engagement processes with all stakeholders which would have added effective value to the budget process, with obvious multiplier effect on the economy.

He also said that the drop in oil production volume as reflected in the budget estimates of the past two years remained a disturbing phenomenon and that the obvious reason was traced to the obstruction to oil production as a result of pipeline vandalism and crude oil theft.

He described the appalling state of budget implementation in the country as still a worrying recurring decimal for the economy. For instance, he said ,the unspent funds that were being rolled over into the economy only make a mockery of development which is a dire necessity across the nation and that the government must be seen to be taking steps to improve it. He said the 2014 budget, which is described as one of job-creation and inclusive growth, deserves to urgently rise to the occasion to defend itself, in view of the yawning gap between employment created and the army of the unemployed.

After the passage of the Bill, David Mark, Senate president, commended his colleagues for the timely consideration of the budget of the ministries, departments and agencies of government at their various committee levels. He, therefore, appealed to the executive arm of government to ensure efficient and effective implementation of the budget.

Mark
Mark

The passage of the 2014 budget had been a long journey laced with many challenges. The presentation before the National Assembly was shifted several times mainly because of the disagreement between the Senate and the House of Representatives over the crude oil benchmark.

The budget presentation was originally scheduled for November 12, 2013 but President Goodluck Jonathan requested the legislators to reschedule it for November 19, due to circumstances beyond his control. The request was granted by both chambers and the lawmakers looked forward to receiving the president a week later. But the president failed to show up again on that day.

This time, Jonathan cited the inability of the two arms of the National Assembly to reach an agreement on the benchmark price for oil revenue for next year as contained in the medium term expenditure framework, MTEF, as his reason for not showing up. The president explained his absence thus: “Please recall that I had written requesting the Honourable House of Representatives to grant me the slot of 12 noon on Tuesday, 19th November, 2013 to enable me address a Joint Session of the National Assembly on the 2014 Budget. However, considering the fact that, whereas the distinguished Senate has approved the Medium Term Expenditure Framework MTEF, based on a benchmark of $76.5 per barrel, the honourable House of Representatives has used a benchmark of $79 per barrel, it is infeasible for me to present the budget in the absence of a harmonised position on the MTEF. In the circumstance, it has become necessary to defer the presentation of the 2014 Budget to a Joint Session of the National Assembly until such a time when both respected chambers would have harmonised their positions on the MTEF. It is my hope that this will be in the shortest possible time.”

But unlike what happened on the previous occasion, Jonathan’s second excuse did not go down well with certain lawmakers from the senate and the House. Perhaps, because it happened at a time when the country’s political atmosphere was charged, some of the lawmakers read political meanings to the excuse. They alleged that contrary to the issues of MTEF, the real reason why Jonathan did not come was because of the crises rocking the Peoples Democratic Party, PDP, the ruling party. They said he was trying to avoid an embarrassing reception from some aggrieved lawmakers, especially those loyal to the Kawu Baraje-led faction of the party.

Okonjo-Iweala
Okonjo-Iweala

However,   the lawmakers got over their disagreement to peg the crude oil benchmark at $77.5, thus paving the way for the executive arm of the government to present the 2014 budget to them. Again, the lawmakers expected Jonathan to present the budget himself, but the president delegated Ngozi Okonjo-Iweala, minister of finance and supervising minister for the economy, to stand in for him. Okonjo-Iweala was accompanied by Bright Okogu, director-general of the budget office and some of her colleagues in the cabinet.

In the budget proposal, the government presented N4, 642,960 trillion to the National Assembly for consideration and passage. After a lot of debate, the Senate increased the budget by an extra N52, 230, 000 billion to bring the total figure to N4, 695, 190, 000, 000.

 Before passing the Bill, the Senate debated its general principles and read it the second time on January, 23 before referring it to the committees on appropriation and finance for further legislative action. The committees subsequently referred the schedules of the Bill to the appropriate standing committees on money and bills for further legislative action.

The executive proposal submitted by President Jonathan was N4,642,960,000,000 which included, N399,687,801,891 (statutory transfers) N712,000,000,000 (debt service), N2,430,665,361,597 (recurrent, non-debt expenditure) while the balance of N1,100,606,836,512 would be for contribution to the development fund for capital expenditure. The committee subsequently referred the schedules of the bill to the appropriate standing committees on money bills in line with Order 92(4) (a) of the Senate standing order.

The Committee drew up a work plan which gave Standing Committees a time line within which to submit their reports. This was extended to the end of March, 2014 to enable them to conclude engagement with Ministries/Departments/Agencies and report back to the Committee. A total of 51 committees submitted reports and defended same before the committee.

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