CSJ faults 2017 budget proposal presentation

…illegality may have occurred …

Centre for Social Justice (CSJ) has condemned the presentation of the 2017 budget proposal to the National Assembly without the approval of the Medium Term Expenditure Framework (MTEF).

CSJ in its preliminary review report of the 2017 budget issued by Eze Onyekpere, its Lead Director, argued that there cannot be an executive budget submitted for legislative approval without the approval of MTEF adding that “illegality may have occurred in the preparation and presentation of the budget.”

CSJ posited that the National Assembly should approve the MTEF before commencing work on the budget. “NASS is expected to do a thorough vetting of the proposals before their approval and forwarding for presidential assent.”

While also faulting the presentation of the budget on December 14 2016, CSJ stated that the presentation is coming very late in the year and a few days to the start of the legislative Christmas and New Year Break.

Commenting on the N2.36 trillion deficit in the budget that is expected to be financed mainly by borrowing the sum of N2.32billion from external and domestic sources. The Centre argued that this will further add to the country’s already high debt profile. Adding that the deficit is 32.34% of the overall expenditure of N7.298 trillion.

While also picking a whole on the budget’s Revenue Framework. CSJ stated that the lack of a clear path for the resolution of the insurgency in the Niger Delta region will affect the realization of the projection for oil revenue.

“The President indicated that disruptions in crude oil production partly contributed to significant shortfalls in projected revenue. If the country could not meet the 2016 projection, and without resolving the challenge, it is likely that the 2017 projection will not be met. But the $42.5 benchmark price seems realistic if members of OPEC and other oil producing nations stick to the current path of cutting down on production.

“Secondly, it is not clear whether the N565.1 billion recovered loot is already in the bag or being expected. This should be clarified by the fiscal authorities. If it is an expected sum, then it should not be made a revenue source and should only be appropriated when it has already been realized through a supplementary appropriation.” CSJ advised.

While urging for the speeding up of reform bills like the Petroleum Industry and Governance bill and the use of incorporated joint ventures instead of cash calls awaiting the budget, the CSJ urged the Presidency to continue good faith engagements and negotiations with Niger Delta militants to restore peace to the troubled region so as to increase crude oil production.

“NASS should also ensure that revenue projections are based on empirical evidence; consider the 2016-2018 External Borrowing Plan and come up with a position; and if possible, trim budget expenditure to be in harmony with realistic and realizable revenue projections.” CSJ urged.

The Centre for Social Justice also commended the Federal Government for the signing of an agreement with Morocco to revive abandoned Nigerian fertilizer blending plants, as wall the promise to fully align fiscal, monetary and trade policies to promote import substitution.

While also lauding the idea of providing funds to clear outstanding MDA electricity bills, CSJ also applauded FG’s decision to revive the Export Expansion Grant and the expansion of existing as well as the development of new Export Processing and Special Economic Zones

The proposed recapitalization of the Bank of Industry and the establishment of the Development Bank with $1.3billion to focus exclusively on small and medium sized firms, by the government was also commended by the Civil society Organization.