Thirty seven per cent of the nation’s budget is spent on salaries, wages and allowances of about one million civil servants, the Federal Government said yesterday.
Giving an insight into the 2014 budget estimate presented to the National Assembly for consideration, the Director General of the Budget Office, Dr Bright Okogu, said the persistent clamour for increased wages, allowances and salaries of civil servants led to the jerking up of recurrent expenditure.
He urged labour unions to think beyond the immediate gains of a fat salary and look at the effect of their demands on the nation’s economy and themselves.
According to Okogu, when a huge amount of money is spent on salaries and wages of Federal Government workers to the detriment of capital projects, jobs that could have been created would be lost and the civil servants who get these enlarged wages end up footing the bills of their relatives who ordinarily could have been employed by the system.
Minister of Finance Dr. Ngozi Okonjo-Iweala added: “There are additional pension arrears which will need to be incorporated in our recurrent budgets in the future, so the size of this spending will increase further, if we do not take any action. We will need to make some tough choices in the future about the structure of our budget.
“We need to strike a balance between a growing wage bill for the public sector and investing more of our resources in infrastructure projects.”
She said her ministry worked hard to reduce this ratio from 74.4 per cent in 2011 to 71.5 per cent in 2012 and further to 67.5 per cent in 2013, “but it has risen again to 74 per cent in 2014.” She said the executive was “looking to the National Assembly to assist us in reviewing and repealing these laws to enable us rationalise some of these duplicative agencies”.
On the whereabouts of the $10.8 billion, which was not remitted to the Federation Account, the minister said:
“After our initial reconciliation, we now have a revised amount of $10.8 billion which still needs to be accounted for. This revised $10.8 billion outstanding is the amount put forward by the Federal Ministry of Finance, following ongoing reconciliation exercises with the NNPC at FAAC meetings over the past two years.
“The Federal Ministry of Finance has played its role in bringing all parties to the table to agree and discuss the outstanding funds that should be remitted to the government. The next stage of this discussion is to ensure that these funds are paid into the Federation Account.”
She added that “what will actually bring in the money is the hard work of completing the reconciliation exercises to find out what NNPC has spent on its operation (with supporting invoices and documentation) and what has to be remitted to the Treasury. It has not been completed, so claims by any parties in this exercise are premature”.
In 2014, the Federal Government, she said, will continue to focus on the completion of critical infrastructure, projects. “Government has advanced the implementation of the Power Road Map with the successful privatisation of four power generating companies and 10 power distribution companies.
“In 2014, we shall focus on completing the privatisation of the NIPP projects, speed up work on our gas pipeline infrastructure and investment in hydro – electric power. In addition, we will also accelerate work on ongoing road and rail projects across the country – in particular, the Lagos-Ibadan Road and the Second Niger Bridge. We will also speed up upgrading of our aviation infrastructure especially the construction our five new airport terminals and 13 perishable air cargo terminals.”
She said the government would continue with efforts to reduce the cost of governance. “Specific measures to be taken in line with Mr. President’s directive include holding the training of MDAs’ and parastatals’ personnel in Nigeria while overseas training programmes will only be approved in exceptional cases. Moreover, the number of overseas trips by government officials will be curtailed while the size of delegations accompanying key government officials on foreign trips will also be reduced.
She said the President’s office had already begun trimming down the size of the delegations, which accompany him for foreign visits. The Head of Service and the Director-General of the Budget Office will develop new guidelines for foreign travel by government officials which will be circulated to all MDAs. We anticipate to save about N3 billion from the introduction of this new policy.
Minister for Power Prof. Chinedu Nebo assured that there will be improved power supply In the East, Nebo said gas pipeline and electricity installations were being vandalised by thieves whereas the vandalisation of gas pipelines in the West was the activities of saboteurs who deliberately vandalise the pipes at various locations to frustrate government’s efforts.
Minister for Works Mike Onolemenmen said the Abuja-Lokoja road would be completed in April same as the Benin-Ore axis of the Benin-Ore-Sagamu Expressway, with the completion of the Sagamu end scheduled for the end of 2014.
The ground breaking ceremony of the Second Niger Bridge, he said, will be carried out this year to effectively herald the commencement of work on the Second Niger Bridge.
Prof. Akpan Ekpo of the West African Institute for Financial and Economic Management (WAIFEM) warned against delay in the passage of the budget as this may impact negatively on its full implementation.
Dr. Okonjo-Iweala said: “Challenging budget process often leads to slippages in our budget timetables, and that means we have a reduced time period for implementing the budget.
“She urged the National Assembly “to review the 2014 budget promptly so the Executive can implement it expeditiously for the benefit of Nigerians”.
