Nigeria's budget, ineffective document ' Analysts

Reactions have continued to trail the 2012 budget proposal presented to the National Assembly by President Goodluck Jonathan on Tuesday with analysts faulting some areas of the budget.Some analysts, who spoke with our correspondent on Wednesday, described the budget as an ineffective document and noted that its implementation had become a major problem.The Chief Research Analyst, Stakes Capital, Mr. Sanyaolu Kehinde, said, "The budget in Nigeria is unproductive and that is why we have appropriation budget all the time. It has become a ritual and we just present the budget because other countries are presenting it."Most of the time, they implement just 20 per cent of the budget to the extent that ministries, departments and agencies are returning money to the federation account because they dont implement it."On oil subsidy, Kehinde said the fact that there was no provision for subsidy in the budget technically meant that the government would remove fuel subsidy from next year."Oil subsidy has been removed officially; according to them, governors are no longer making provisions for subsidy payments," he added.A former Managing Director, Mutual Alliance Investment and Securities Limited, Dr. Olakunle Ologun, said the budget had a lot of confusion, stressing that it was an exercise in futility because it would not be implemented.He said, "The government wants to remove fuel subsidy and still bring inflation to a single digit figure. I dont know how they want to achieve that because removal of fuel subsidy itself is inflationary. Also, I fault some allocations to some strategic sectors, for instance, education and agriculture. With the enormity of problems in the education sector, you will realise that the funds allocated to that sector is too small."The 2012 budget, according to Jonathan, has an aggregate size of N4.74tn, representing an increase of six per cent over the N4.48tn appropriated in 2011.It came with a deficit of over N1.1tn, as the Federal Governments share of revenue for 2012 was put at N3.64tn.Jonathan said the figure was higher than the 2011 revenue estimate by nine per cent.The Gross federally- collectible revenue for 2012 was estimated at N9.406tn.The recurrent component of N2.47tn took the lions share of 72 per cent, just 2.4 per cent less than the 74.4 per cent spent on government bureaucracy in 2011.The capital component of N1.32tn also rose by only two per per cent to 28 per cent of the total budget size, compared to the 26 per cent in 2011.Jonathan had said, "The fiscal deficit is projected at about 2.77 per cent of GDP in the 2012 budget compared to 2.96 per cent in 2011."This is within the threshold stipulated in the Fiscal Responsibility Act, 2007 and clearly highlights our commitment to fiscal prudence as a way to create more space for the private sector."
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