The fact that the country does not have an operating budget passed by the National Assembly in the first month of the year speaks volumes about the dysfunctional political economy of the republic. For that reason, to do anything sensible on that score we really ought to get the election out of the way. Not much profound thinking necessary for a budget process is likely to take place amidst electoral cut and thrust.
Even without election fever in the air, the budget as presently constituted looks already dead on arrival. In view of current happenings in the oil markets both projections and allocations, look unrealistic. It is also clear that not much scrutiny is been done by those whose concentrations are on the coming elections. In addition the projections contained in the Medium – Term Expenditure Framework (MTEF) WHICH WILL BE USED TO DETERMINE THE ALLOCATIONS IN THE BUDGET are no longer realistic. With oil prices plummeting this is only stating the obvious.
It is also true that some of the ‘allocations’ muted defy commonsense. For example, as a group of senators have pointed out , the allocation of about N64 billion for the rehabilitation of the ex- Niger Delta militants looks odd compared to only N5 billion allocated to the entire Northeast that is being ravaged by insurgency.
Furthermore, the international oil price situation ought to have provided an opportunity for a re- think. Unfortunately we are missing an historic opportunity. Recurrent expenditure, for example, remains self indulgently high. If there was ever a time to implement and extend the tepid Oransaye report on the cost of the (ludicrously and unsustainably high) machinery of government it is now. Whoever wins the election, after the initial euphoria will be forced to confront our demons. The post – election administration will also face the bitter reality that any oil benchmark above 35 dollars is unrealistic.
The political establishment as has failed the nation. The executive should have emulated sensible mono – crop economies by engaging in counter – cyclical budgeting as a hedge against ‘boom and bust’ thereby preparing for the rainy day. The legislative arm, by not setting up a proper U.S type Congressional Budget Office, has denied itself of the much needed technical empowerment to properly scrutinise and effect the budget cycle. For this reason the budget process itself is mired in corruption.
For an economy largely dependent on the direction of the federal budget the only option now is to get the elections over and done with after which calmer counsel will bring a more realistic perspective to the review and outlook of the economy of the nation as they work out a realistic budget.