The Nation Newspaper

Tag: budgeting

  • Participatory budgeting

    The new government of Kwara State has agreed to ensure participation of citizens not in government in the budget process. This announcement was made at a special economic summit in Offa by the deputy governor of the state, Kayode Alabi. He was at the summit to represent the new All Progressives Congress (APC) governor, AbdulRahman AbdulRazaq.

    Participatory budgeting (PB) is a process of including civil society, professional groups and other non-state actors in deliberating over and reaching decision on budget proposals prepared by the state or municipal unit. Although PB has been in existence since 1988 when it was introduced in Brazil, and has since been used in parts of East and South Africa, Kwara State may be a trailblazer for Open and Participative Budgeting in Nigeria if it walks its talk.

    Since the advent of post-military governance, there have been demands for the democratisation of the budget process. One response to such calls until the recent announcement by the Kwara State governor has been ranged from acknowledgment of the need to move from traditional budgeting to zero-based budgeting and later to calls by government leaders for open budget. Kwara State’s commitment to participatory budgeting will be a further step towards decentralisation of budgeting and providing access to civil society and traditionally marginalised citizens to key budget documents that can demystify the budget process for non-state actors and individuals.

    Read Also: Kwara to ensure participatory budgeting

    Kwara State’s pledge to promote open budgeting can deepen democracy at the grassroots, particularly if the process of selecting the group to scrutinise annual and supplementary budgets is not restricted to political partisans, civil society and professional groups. Giving hitherto excluded demographic groups opportunities to see the connection between budget paradigms and details to their needs can enhance the potential of open budgeting.

    Including non-state actors who reflect the divergent interests in the state will offer a good opportunity for diverse interest groups to agree on efficient and fair allocation of resources to competing divergent needs in the state. This policy will reduce the alienation often expressed by citizens about budgets in Nigeria as designed principally to cater to the desires of the elite.

    For participative budgeting not to become a circus or a subtle distraction, it is necessary for Kwara State to complete each year’s budget proposals well in advance and enable citizens to have time to scrutinise such budget proposals and offer suggestions  for improvement for timely consideration of the budget by the legislature. In addition, the proposed open budget policy should include extending citizen participation to the post-budget stage. It may not be enough to allow citizens to be exposed to how governments raise and spend money.  They should also be involved in monitoring budget implementation by having opportunities to participate in in-year budget report, mid-year review, and year-end report. It may be meaningless for people who participate in approving a budget not to have a voice in whether budget promises are kept and, if not, why. Such knowledge can be of benefit to the state and citizens in deliberating on subsequent budgeting exercise while enriching financial and fiscal literacy of citizens.

    If an active citizen participation in the budget process is well managed in Kwara State, it may become an enviable model for other state and municipal or local government units in the country. Involving citizens who are not state actors in participating in budget deliberations can enrich the system of representative democracy and the process of accountability.

    Governor AbdulRazaq should consider encouraging municipal and local governments in the state to include citizens at those levels in the budget process. Such policy will enable citizens to appreciate if the priorities of the budget are in agreement with the development challenges of the state and local governments from the perspective of non-elite members of the polity.

  • A hollow ritual called budgeting

    The opprobrious farce and skepticism that, most of the time, herald the Nigerian President’s yearly ritual of laying the budget papers before the joint session of the National Assembly have become needless rites that end up adding little or no value to the eventual outcome of the entire drama. The sickening reality is that, one budget presentation after the other, the fate of the hapless citizen still hangs precariously in the balance no thanks to speeches that are long on rhetoric and abysmally short on delivery. That is the tragedy of our situation as President Muhammadu Buhari made his third visit to the lawmakers’ haven to deliver his administration’s financial projections for the year 2018 on Tuesday, November 7 As you would have noticed, even this simple exercise was not without the colourless shenanigan acted by seemingly petrified National Assembly members against what they tagged the failure of the executive to come clean on how well or otherwise it has been able to implement the 2017 budget which was signed into law some months back.

    To be candid, I knew that the badly-choreographed cacophonous rant that played out on the eve of the actual date picked for the budget presentation and which was said to have been quelled by the ‘swift’ intervention of the President of the Senate, Bukola Saraki and the Speaker of the House of Representation, Yakubu Dogara, was the symbolism that the executive had been waiting for to confirm that the event would take place as scheduled. We have witnessed far too many huffing and puffing over budgetary issues in Nigeria’s democratic trajectory to get unnecessarily worked up over a script that has become part of a huge scam. We may not be that confident to predict that the latest face-off would be resolved with the usual backslapping by the parties involved after a compromise of some sorts must have been reached. Yet, we wouldn’t be far off the mark to assume that it is just another storm in a tea cup that would, first, culminate in tales of abuse of power with salacious snippets of budget padding to satisfy the needs of the irritants in power rather than the yearnings of the most vulnerable citizens and the general public. By the time the figures come crashing down, those the budget was drafted for would be holding the wrong end of the stick–left to grapple with the tasteless reality that they had been taken for another rude, bumpy ride for the umpteenth time.

    In his speech, Buhari echoed the traditional sound bites that earned him the rapturous admiration of his audience—the same set of persons who would soon assault our sensibilities with details of how a poorly-packaged budget would have to be reworked with their eagle-eyed expertise by juggling the figures with some magical zeros. If my memory is not fading, all budgetary processes had been made to pass through this route since 1999 when President Olusegun Obasanjo presented his appropriation bill to the joint session of the National Assembly. For now, and with the benefit of hindsight with what happened to Buhari’s two earlier budgetary journeys to the hallowed chamber, nothing suggests that his Budget of Consolidation would not suffer the same fate.

    Stripped of the technicalities and the humongous figures being bandied around key economic sectors, the President didn’t say anything that we have not heard before. Even the moniker that the 2018 Appropriation Bill was adorned is not new. We have always been consolidating one thing or the other since independence! It is, therefore, interesting to hear the President informing us that the N8.6tr estimates for 2018 would be partly funded by over N500bn recovered loot when no one has told us how much of such funds were channeled into the 2017 budget whose capital expenditure is said to have performed below 10 per cent. How much exactly has been recovered and what is the projected figure that the government hopes to rake in from these looters next year? Does that include the famed Abacha loot which runs into millions of dollars and scattered around the world?

    As a number of economic analysts have pointed out, it is one thing for the government to pat itself on the back for being “gender-sensitive, pro-poor and interested in catering for the most vulnerable” among us. However, it is another kettle of fish to walk that talk. The positive prognosis that has greeted the event notwithstanding, the 2018 budget proposal remains a promissory note like many others in the past. With the dismal performance in the appropriation of funds to itemized projects in the 2017 budget, it is difficult to understand why the President thinks anyone would believe him when he said the N500 billion allocation to the Social Intervention Programme has been retained in addition to the N100bn that would be set aside for the Social Housing Programme. In any case, how much has the government been able to release for the same programme as the 2017 budgets slowly grinds down and what impact has it made in the penurious lives of the vulnerable millions in our midst. With over 67 per cent of the population wallowing in abject poverty, what guarantee do we have that the N100bn, if ever released for the SHP, would be used to build houses to be inhabited by the truly poor in a society where such houses are often willed to the rich after completion?

    In a country with a criminally high unemployment rate, the vibes one gets from the President’s speech does not give any hope that the teeming youth roaming the streets would smile any soon.

  • NASS’ scorched-earth budgeting

    In the days of yore when yam was the king of crops in Igbo land, men with the largest yarn barns were the elite and by extension, the leaders of the community. The tuberous crop was held in such high esteem that a festival was devoted to it at harvest time. Iwaji subsists today and no true son of the land ate new yam before the annual thanksgiving offering to the gods of fertility, of clement weather and wholesome, regenerative existence.

    Yam represented goodliness and the essence of life. In terms of food value it was versatile, amenable in the kitchen and to the taste buds like no other food crop. It was indeed considered an amiable companion in the household thus its elevation to royalty.

    Further, it was tended and managed like no other crop – from giant mounds to special stays for the climbers; directing the tendrils; specialized harvesting and of course, that special abode known as barns. And even in the barn, yam tubers were not littered carelessly; there was a special art to stringing the tubers in neat straight rows.

    These rituals must have elicited the sagely saying that: “If a man considered his yam truly yam, so it would be”. This interprets to mean that if your yam were truly important to you, you would shower it with the attention fit for royalty and of course it would yield to you bounteous harvest.

    Phew! What is Hardball going on about? Well, putting it most plaintively, let’s say if a country considers her budget crucial, so would it reflect in her growth and development.

    Today, Hardball likens Nigeria’s budgeting system to yam cultivation in Igboland of the medieval times. Except that our legislators do not quite seem to grasp the importance and magnitude of the Appropriation Bill. Just as yam was the mainstay of that medieval economy, so is the budget the soul of the modern nation state. You mess up your budget, you mess up your country.

    Over the years, in fact since 1999, successive sessions of the National Assembly (NASS) have failed to understand the true import of the annual budget.

    First, the budget has never been presented on deadline since 1999. In deed in one of those years, perhaps 2001, the entire year ran out without a federal budget. Can anyone quantify the cost of that?

    That the country is so direly underdeveloped despite huge budgets is signpost to the fact that the NASS has failed woefully in its duties by the people. Apart from the usual lackadaisical attitude today, legislators deign to have powers to initiate, approve, and oversight projects at the same time?

    Sadly, major federal strategic infrastructure which had been abandoned by previous governments but recently being revived are to be abandoned once again because of an obdurate NASS? We have taken one step forward and about to take ten backwards because of the scorched earth politics of our NASS members? What calamity!

  • How to Manage Your Family Budget in Tough Times

    How to Manage Your Family Budget in Tough Times

    That the country is going through a recession is no longer news, but any parent can testify that children don’t know or understand what that means so meals have to made, the rent and utility bills have to be paid; in short the family wheels must continue to turn. Here are a few tips to help families survive these times.

    Buy what you need not what you want

    There are so many things people spend money on that can be avoided, things like Aso-Ebi, unnecessary socials, trips, in short anything you don’t need (like your life depends on it) can/ should be cut it out of your budget.

     

    Buy the cheapest options for your usual expenditure

    In buying basic necessities like foodstuff, toiletries, and utilities, ensure that you buy the cheapest version of what you need. For instance, if you love eating fish, go ahead and indulge yourself, only buy the most affordable option for your budget.

    Spend Less Than You Make

    Learn to spend less than you earn especially when times are tough. Cancel your credit card and pay cash for purchases to avoid running up debt. If you have to go into debt to acquire things, it might be best to wait until things get better before buying big budget items.

    Ruthlessly Cut Down Waste

    Most households have ways in which money is wasted; it could be food, utilities, shopping e.t.c. For instance take the time to carefully measure out food items into portions before cooking. Store leftover food in the fridge/ freezer. You can also incorporate left-overs in the next meal. For instance, if you have left over beans from an earlier meal, incorporate it into another meal. Also buy only what you can use, especially perishables. When foodstuffs go bad because they aren’t eaten in good time, money has been wasted.

    Never put your Children In Schools You Can’t Afford

    Quite a number of parents are guilty of this, its normal to want to give the best education, but it should be what you can afford. How do you know the school is beyond your means? If you are always terms behind in payment, then the school is beyond your means. Most parents who put their kids in high brow schools are only paying for atmosphere. So don’t get into debt simply for real estate, or to keep up with the joneses’.

     

  • Why You Need the 50/30/20 Budget

    Why You Need the 50/30/20 Budget

    We are in the opening quarter of a recession year, which instead of easing off, seems to be biting harder. However, the best way to survive in times like this is to strictly manage your finances. There are two types of people when it comes managing finances; those who like to face things head on, and those who choose to bury their heads in the sand like ostriches.Surprisingly, quite a number of ladies belong to the latter group, and are not independent when it comes to managing their finances, even when part of a couple.

     

    Find out about the 50/30/20 budget and learn how it can help you get a clearer understanding of your expenses.

    50%: The basics

    This is not quite as exciting as it sounds, even though fun money, and miscellaneous expenses fall into this category. Essential bills for things like your cable and mobile phone bills belong here. This is however the most flexible of the three, as the more you can save here, the more you will have to add to the other two groups.

     

    20%: Savings

    The lion share of your income goes into the basics. These are the things you simply can’t live without. They include things like food, housing, transportation, and utility bills. If for instance you live in Lagos, and drive you will spend more on transport than someone who lives in Minna. How you manage your income to cover the basics is your choice, but 50% should be left when taking out the basics.This rule will also set a good benchmark for the cost of living for items like transportation, and housing.

     

    30%: Personal Expenses

    This category gets the least percentage, but is simply the most important. Savings should be done after taking care of the basics, and before personal finances are tackled. This is the most goal centred part of this budget system. Should your job permit you to divide your salary into two different accounts, this is an uncomplicated way to send 20% of your money into your savings account without thinking about it. Adding to your investments and paying debts also counts towards this 20%.

     

  • Fatuous budgeting…

    For a bit of an insight into the workings of the mind of Hardball, it can now be revealed that headlines are sometimes the trickiest part of this task. Yes in this daily grind of churning out these short, troublous pieces, the headline sitting on each article is usually the toughest nut to crack.

    Let’s consider the one above – “Fatuous budgeting”. It was arrived at after juggling so many options. Ideas considered and discarded include: “Magical budgeting”, “Unrecessed budgets” and “Bounteous budgeting”.

    We eventually settled for the one above: “Fatuous Budgeting” for the simple reason that it most approximates the thought for the day. But “Bounteous budgeting” was very tempting for its alliterative resonance. Such is the workings of Hardball; but once there is agreement on the head, the body would often fall into place.

    And the body of this head concerns the rash of budget figures flying all over the place. It’s a season of budgeting in Nigeria. What Hardball would term Nigeria’s budgeting charade. The very act of budgeting must be the most wasted effort in Nigeria; especially in the public sector. Most times previous year’s figures are merely dusted up, padded up and re-presented. And, of course, nobody bothers to go through the rigours of implementation. But this is a matter for another day.

    Today, Hardball is appalled by the bad fat still dripping from the federal budget and those of some agencies of government. Let’s take a few examples: one, for 2017, the Federal Government has set aside N42.9 billion for the State House. If this does not make your jaw drop, here are a few breakdowns: the first family will spend a little over N123 million on food in 2017 (Hardball is dumb with figures but this roughly comes to about N360,000.00 per day!).

    What do we know? Perhaps the first family eats golden grains. Apart from food, the Presidency has budgeted about N1 billion for travels next year. And to keep the travels smooth, N2.4 billion will be needed to keep the Presidential Air Fleet in good condition for these pricey shuttles.

    Let us back off presidential privileges a while for we ordinary mortals cannot claim to understand the essence or even the workings of that behemoth that ensures that we can breathe. One or two examples of federal agencies and rest this case. One, the Federal Inland Revenue Service (FIRS) has reported that it plans to spend N586 million on refreshments and meals in 2017; N750 million on fuel for its generators and N400 million on electricity charges. Another N750 million is for cleaning and fumigation, to name just a few items in an annual budget of N144 billion already passed.

    The Nigerian Communications Commission (NCC), another federal agency with deep pockets, will spend nearly N2 billion on travels out of its about N71 billion budget for 2017. This fatuousness is likely to be replicated in most other agencies.

    So much fat dripping all over the place and they tell us there is no money? And who said there is recession?

     

  • Osinbajo: Fed Govt to adopt zero-based budgeting

    Osinbajo: Fed Govt to adopt zero-based budgeting

    The Federal Government will adopt a zero-based budgeting format for next year, Vice President Yemi Osinbajo said yesterday.

    He spoke while receiving the National Economic Summit Group (NESG) at the State House in Abuja.

    He also received a delegation from the Chartered Institute of Stockbrokers (CIS) and the Association of Stockbroking Houses of Nigeria (ASHON).

    The zero-based budgeting, he said, will be carefully coordinated to ensure that it is policy-driven, especially regarding the proposed social intervention policy of President Muhammadu Buhari’s administration.

    Zero-based budgeting is planning according to needs and costs, different from the existing Envelope Budgeting or traditionally incremental budgeting whereby the planning is based on existing income and expenditure as the deciding factor in national financial planning. This often incurs waste and assumes previous costs as constant.

    Osinbajo, according to a statement by  his spokesman Laolu Akande, also told the NESG that the introduction of the Treasury Single Account (TSA) policy and its implementation by Ministries, Department and Agencies (MDAs) is a creative way of blocking leakages in the system to make way for a workable budget.

    Through the zero-based budgeting, he said, the Federal Government will focus on a bottom-up approach to development.

    According to him, the Federal Government is also planning to set up an infrastructure fund to facilitate easy funding for critical areas of the economy.

    [ad id=”403656″]The fund, Osinbajo said, will be planned outside of the budget to handle major segments of the economy, such as road and power.

    “Government is working out a document that would guide the administration within the four years of its life-span,” he said.

    The NESG delegation praised the Federal Government for the introduction of the TSA and offered to be part of the advocacy as a sound financial policy.

    The vice president said the Federal Government would explore the avenue of utilising the capital market as another means of providing alternative funding options for the execution of capital projects.

    He said allowing retail investors to come into the nation’s capital market would ultimately deepen the market with potentials for multiplier effects on other sectors of the economy.

    Some of the problems of the capital market, he said, are due to unethical practices by some operators.

    He said those who caused the crash in the market in the past were not punished, and urged the two bodies to engage in self-regulation as a means of protecting investors and the market.

    The leader of the delegation and Acting President of CIS, Mr. Oluwaseyi Abe, praised the achievements of the Buhari administration within 100 days, especially its impact on security, power and the anti-corruption crusade.

    Stressing on its positive effects on the overall economy, he said a new Nigeria was being formed under Buhari’s leadership.

     

  • Oyo Assembly calls for public participation in budgeting

    The Oyo State House of Assembly has urged the state government to include the members of the public in the documentation of the yearly budget through a public hearing.

    In a motion moved by the Chairman on Appropriation Bills and Budgeting, at the plenary, Mr Olusegun Olaleye, he noted that in 100 survey carried out by International Budget Partnership (IBP), the average score for public participation in the budget process is 19 out of 100.

    The lawmaker lamented that public participation in budget process over the years had not been practiced in the state.

    He added that the unfortunate situation is not alien to other state, except in Lagos and Ekiti states where a reasonable success has been recorded.

    According to Olaleye, good public participation practices will help governments to be more accountable and responsive to the masses.

    Adding that it will also improve the public’s perception of governmental performance and the value the public receives from the government which guarantees effective budget implementation.

    “Experience had shown that the relevance of participatory budgeting to governance especially in a democratically elected government would among others improve performance by better understanding what the public wants and expect from government and adjust services and service levels more closely to citizens preferences” he said

    The motion was also seconded by other lawmaker which include, Segun Ajanaku, Michael Adeyemo, Joshua Olagunju, Farintan Fakorede among others.