Over the years, budgeting in Nigeria has always tilted towards consumption as reflected in the large recurrent expenditure segment of all the annual budgets at both federal and state levels. This, coupled with lack of budget discipline that has seen budget performance at 50-60 percent in most cases, is the reason the country still grapples with poor infrastructure in all sectors of the economy.
Presently, the country is right into what is a budget season with many state governments presenting their 2024 budget appropriation to the state assembly for consideration and passage.
Of the states that have presented their budgets, Enugu State stands tall with a paradigm shift or a departure from the norm. The state’s Appropriation Bill, 2024, recently presented to the State House of Assembly by Governor Peter Mbah has continued to elicit national reviews for good reasons.
Laying out the N521.5 billion estimates for the 2024 fiscal year titled ‘Budget of Disruptive Economic Growth’, Governor Mbah put the Recurrent Expenditure at 107.2 billion, representing about 21 percent of the budget, while the Capital Expenditure is 414.3 billion, making up the remaining 79 percent of the budget.
Expectedly, the ratio of the Recurrent Expenditure to Capital Expenditure has commanded the most attention, as it represents a clear departure from most of the usual ills about Nigerian budgets.
Over the years, Nigerians have complained bitterly about the high cost of running government as reflected in the Recurrent Expenditure, while only a marginal proportion of budgets are reserved for Capital Expenditure, a situation analysts and economists have warned is incapable of growing the economy and could only lead to further underdevelopment.
Equally attention-grabbing in the budget is the sectorial provisions. At a time of grave national economic crisis, the state’s budgetary thrusts are heartwarming. On a sector basis, the state government has proposed to spend N207.8 billion on the Economic Sector, making it the highest in the budget.
It is followed by the Social Sector with N182.9 billion, Infrastructure with N82.5 billion, Water with N28.9 billion, Agriculture with N25.1 billion, and health with N21.7 billion. Other priority Sectors in the budget are Security and Job Creation.
We see these figures and priorities as encouraging, especially for a government that has set for itself an overarching target to grow its economy from $4.4 billion to $30 billion in four to eight years as well make take the state to top three economies in Nigeria and attain a zero percent poverty headcount in the same period.
It is expected that the focus on infrastructure will facilitate connectivity, boost trade, and increase overall accessibility needed to attract investments and create jobs, while the planned investment in agriculture will help the state attain self-reliance and economic diversification beyond platitudes mouthed by various Nigerian governments over the years.
Paying attention to security, in our view, will equally consolidate the state government’s war on insecurity where its pushback against agents of sit-at-home, instability and criminality has seen the state enjoy significant respite. That will also be a major driver for both local and foreign direct investments (FDI).
Noteworthy, in terms of sub-sectoral provisions, is the state government’s proposition to spend N134.9bn on Education which represents a whopping 73.6 percent of the budgetary provisions for the Social Sector and 33 percent of the total budget of N521.5 billion.
We cannot readily recall any government, be it at the national or state government level, that has given education such a lion’s share of its budget since the return of democracy in 1999. Whereas so many promises are made about transforming the educational system and whereas the UNESCO educational expenditure benchmark is 15 percent to 20 percent of public expenditure, such promises and benchmarks are hardly matched with action.
We hope that turning around the Education sector of the state will have a far-reaching impact on job creation, poverty eradication, security, and overall economic prosperity.
Equally noteworthy are the state’s revenue projections. Of the estimated N383.7 total recurrent revenue, the opening balance is N11 billion, Statutory Revenue is pegged at N60 billion, Excess Crude Oil Revenue is N16 billion, Value Added Tax (VAT) is estimated to bring in N44 billion while Internally Generated Revenue (IGR) is expected to contribute N252.7 billion.
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The emphasis on IGR in the revenue projections signals a heartwarming departure from the tradition of overreliance on accruals from the Federation Accounts Allocation Committee which only breeds corruption, indolence, lack of creativity, and embarrassing unproductivity in governance.
Whereas this is but a budget estimate, it underscores some commendable break from the routines that have always underpinned and undermined budgets in Nigeria. It represents a glimpse of hope and serious policy direction for socio-economic repositioning that should be emulated by other states and even the federal government.
For instance, the Enugu State budget proposal has shown that various levels of government can cut down on the cost of governance and direct most of the resources to capital projects that will impact the lives of the people. What it takes is determination, vision, and fidelity to the people.
Having set the ball of change rolling, we urge Mbah and his cabinet to roll up their sleeves and go to work to ensure that the budget is implemented to the letter when ultimately passed by the state House of Assembly.
We also call on the people of Enugu, the state House of Assembly, and the civil society community in the state to be up and doing in tracking the budget and holding the government accountable. We believe that, in pursuit of the current dispensation, this is the way to go.
