Budget of ‘Renewed Hope’ or business as usual?, by Ola Emmanuel

by · The Eagle Online

Nigeria is counted among the least-developed countries where poverty and hunger is ravaging without let or hindrance. 

Heading into the year 2024, Nigeria is counted among the forty least-developed economies in the world. 

According to the piece written by Sana Ijaz, several factors continue to hinder economic development in some of the world’s regions of which Africa is one. These least developed countries are where to find half of the world’s extremely poor, a group of people that are experiencing moderate or severe food insecurity. 

The Ijaz piece, titled: “40 Least Developed Countries In The World Heading Into 2024,” identifies the evils bedeviling the countries to include activities of global financial system that often impose on the countries unsustainable external debt burdens, which have not really help any of the countries (or only helping a few) to climb the economic ladder; and weak governance, political instability, conflicts, health crises, and unfair international trade practices also playing active roles in the least-developed countries’ regression to underdevelopment, and struggling with resource allocation needed for development. This is in addition to “substantial obstacles to economic progress, including limited access to technology, finance, and opportunities”.

With Republic of Congo and Burundi occupying the extreme ends of the least 40, Nigeria is ranked the 32nd least-developed country, heading into 2024. With  GDP Per Capita of $2184 and Human Development Index (HDI) ranking of 163, it is written of Nigeria in the Ijaz Report that despite having the strongest GDP in Sub-Saharan Africa, the country remains one of the least developed countries on the march into 2024. The country’s economic challenges “are characterised by long-standing macroeconomic imbalances and the urgent need for policy reforms. To achieve sustainable and inclusive growth, Nigeria must implement targeted cash transfers to protect the poor from rising living costs. Additionally, adopting a comprehensive reform approach is crucial to break the cycle of low growth and high poverty, as recommended by the World Bank”. 

However, I have said it before on this page that Nigeria should first be concerned about economic development before worrying about economic growth. Growth cannot be possible where development is missing. The massive population should first be gainfully engaged in production activities and value-giving services, then we can be talking about economic growth.

Year after year, Nigeria is fond of making budget estimates  whereby recurrent expenditures and debt servicing swallows almost 70 percent of the entire budget estimates and capital expenditure never rises beyond 30 per cent. Despite this lopsidedness, the budgets are never implemented 100 per cent, with capital expenditures that directly touches the citizenry at the receiving end. 

Nigerians no longer trust any of the governments, whether at federal, states or the non-existent local government. Many are of the opinion that this democracy is government for the few politicians who are smart enough to ‘hijack’ the government to use the resources of the entire population to take care of themselves in the form of jumbo allowances and perks of office. Can Nigerians be blamed for not trusting the country’s leadership any longer? The so-called dividends of democracy are being received by very insignificant few people. 

Not only are many being thrown into squalor by the hour, the ballooning cost of governance is a major cause for concern. While the government functionaries are calling for the masses sacrifice in the face of massive debts the country has been plunged into by gross mismanagement of assets, the flamboyant lifestyles of the politicians and the allocation of borrowed funds to recurrent consumptions in terms of emoluments has not shown the government is ready to join to make sacrifice but only playing lip service to the cause. 

Besides the alleged N160 million SUV cars to the national assembly members, the amount requested in the 2023 Supplementary Budget for vehicle purchases and renovation of offices in the executive arm of government is a cause for concern. Likewise in the 2024 Budget of Renewed Hope are recurrent items with humongous allocations just to pander to the whims of the few office holders and their hangers-on. It is like the belt tightening is only for the already-impoverished millions of Nigerians, the ever-increasing multi-dimensionally poor. 

The 2023 COP 28 delegates from Nigeria lend credence to the non readiness of the government functionaries to join the call for sacrifice and it is going to be business as usual, if not worse. Over a period of 10 years (between 2013 and 2022, the Nigerians delegation to the annual climate conference range between 49 and 120 participants in 2022. However, the number of participants jumped phenomenally from the highest of 120 participants a year ago to 1,411 participants at a period the government is calling for sacrifice and a few months after another jamboree to UNGA.

Is year 2024 expenditure really going to be that of renewed hope, as being touted? Where are the tools or measures put in place to check agencies that are in charge of revenue generation who spend the revenue by themselves as expenses and allowances? What measures are being put in place to check leakages in realisable revenues as in crude theft, looting of capital projects fund through bloated contract sums, culture of audio budgeting for infrastructures and other capital projects, and such like? Will it be possible, for once, that capital projects provisions are carried out 100 percent and other provisions that directly impact economic development are given priority at the expense of  escalating recurrent and emolument awards to political office holders that have little or no impact on citizens’ standards of living? 

Also Read:

The government has been mouthing its readiness to fight poverty. However, debt servicing allocation is 16 times the costs of fighting poverty. Out of N27.5 trillion budget size, will the significant poor and the unemployed be efficiently and effectively served with N534 billion intervention? How favourable is the budget of renewed hope to the poor? What will the government do differently to create jobs, confront unemployment and ensure that production centres are not closing down (as witnessed recently with the exit of GSK and P&G from Nigeria with attendant loss of over 20,000 jobs, not counting the negatively affected spin-off businesses)?

In the light of the above and with the current economic situation bedevilling Nigeria, can the country’s Budget Decisions be justified in the face of escalating costs of governance what the over 200 million are getting in provision of goods and services?  Or should we, at this stage, begin to carry out a cost-benefit analysis of Nigeria’s democracy and/or we should start to interrogate the government’s effectiveness by trying to measure the amount spent on governance in view of values derived by the citizens? 

According to Jason Lakin, “government decisions affect people’s lives and should be reasonable, not arbitrary. This core liberal principle applies to all major policy decisions, including budget choices. Modern conceptions of democracy, and democratic accountability, also require that government decisions be justified in terms that people can understand and accept. Taken together, liberal and democratic principles require governments to respect their citizens by providing public explanations for their actions that are demonstrably reasonable. 

In short, governments must answer the “why” question. Even in the United States of America where Nigeria copied the federal democracy and government efficiency is much better, it is of the opinion that 80% of Americans believe that government is run for a few big interests rather than the public interest. This much is alluded to in the report titled, “Cost-Benefit Analysis and Public Sector Trust” by Edward H. Stiglitz of the Cornell Law School.

. Emmanuel is a business planning consultant and founder of Leacent Incorporated Trustees, a network of entrepreneurs and a group of cooperatives. He works with a team of international consultants to conceptualise and plan agribusiness and housing projects. As a certified trainer authorised to use the International Labour Organisation’s enterprise development modules, he trains entrepreneurs and organises workshops and seminars for potential and practising entrepreneurs as well as business managers and cooperatives. He also speaks and facilitates at leadership and management workshops on invitation. His book: “Business Planning Made Easy: Step by Step Guide On How To Turn Your Idea To Profitable Business,” is the latest of the books authored by him. Tel.: +234(0)9068602954 (call and sms), +234(0)8023257707 (WhatsApp only).