2024 budget could kick-start a turn-around, By Kola Amzat
Over decades, successive administrations have always rolled out fantastic budgets for Nigerians, but, with sheer or no regard for their implementation.
And, the direct victims of budget non-implementation have always been Nigerian people who as a matter of necessity often place reliance on government spending, as well as other policy initiatives that supposed to flow from budget implementation.
However, Year 2024 Appropriation Bill seems to be presenting a new order.
This hope and high expectation is anchored on three fundamentals.
First, the major stakeholder in the Nigerian project, President Bola Tinubu in recent times has been making unequivocal declarations in several forums that the nation economy is on the threshold of recovery.
There is a reason behind these very assertive declarations!
Of course, the president is conscious of the key components of the budget and what they are purposed to achieve before he started making those audacious pronouncements.
Nigerians should also be gladdened that the president is poised to sincerely, efficiently and holistically implement the budget to the letter, a clear departure from what has characterized past budget exercise.
Secondly, the quantum of efforts deployed-pre, during and post, in the preparation of this Appropriation Bill by the relevant stakeholders; the national assembly, budget minister, budget office, as well as the finance minister & his team suggest that, the implementation of this budget seems a fait accomplice and won’t be business as usual.
Thirdly and more instructively, the key components of the Appropriation Bill as highlighted below, look more re-assuring, inspiring and morale boosting.
For emphasis, 2024 Appropriation Bill of ₦28.77 Trillion is the biggest in the annals of the country’s budget.
Although, it’s not the quantum that matters, but, the strategic appropriation of funds to key areas of development that are capable of reigniting, reinventing and repositioning the nation economy, nonetheless, this Appropriation Bill appears to present a window of new opportunity.
Also, worthy of note is the level of reliance that could be placed on the key revenue sources identified/enumerated to fund the implementation of the budget.
Meanwhile, the budget is predicated on $77.96/barrel, with projected daily oil production of 1.78 million barrel, as well as ₦750-₦800/$ exchange rate.
Except there is challenge of force majeur in the international oil market during the year, it’s largely impossible for crude oil price to go below $85-$90/barrel.
Russia/Ukraine war, as well as Israel/Gaza acrimonious war, and other unfolding challenges in the Middle East are likely to endure for the better of the year. The development would continually fuel the price of crude.
Technically, in all fronts, Nigeria is comfortable with anchored price of $77.96/barrel.
Also, with security tightened up around the deep sea in the Niger Delta Region by the security agencies, coupled with the spirited efforts of Tantita Security outfit to continually frustrate the illegal bunkering operations, there exists no doubt that, it’s a dawn of new era in Nigerian quest to generate optimal revenue from the crude oil to finance its budget.
It’s therefore expected that the nation would be able to continually roll out crude production more than the projected figure during the year.
In the current revenue generation order, FIRS comes closer to crude oil in term of revenue expectation, as the all-important Agency has been projected to bring to FAAC account about ₦6-7 trillion.
With the forward-looking, result oriented and revenue generating expert newly appointed Executive Chairman of the Agency, and his team, the nation should be confident that FIRS will deliver.
Of course, Solid Minerals Ministry is also projected to generate substantial sum towards funding the budget, thus start to fulfill the country’s expectation of been a key economic diversification source.
Other key Agencies of government like Customs & Excise. NIMASA, NPA etc are been projected to contribute significantly to fund the budget. The nation expect them to live up to the billing.
Meanwhile, a whopping ₦9.995 trillion was earmarked for capital expenditure, with recurrent expenditure projected at ₦8.768 trillion and GDP growth projected at 3.88%.
In the history of Nigerian budget, this is also the very first time that capital expenditure is projected to outshoot recurrent expenditure, a clear indication of the federal government commitment and resolve to focus on infrastructural developments, a strategic move capable of addressing the infrastructural deficit, with ultimate result in jump starting the economy.
It’s remarkable that Finance and Budget & Economic Planning Ministry got the highest allocation of ₦6.485 trillion, with capital component of ₦995 billion to supposedly reposition, reengineer and restructure the economy, in all facets.
If the recent declaration by the president that the new administration inherited a dead economy, a fact corroborated by no other personality than Charles Soludo, a celebrated past CBN governor and incumbent governor of Anambra state, is anything to go by, then the above mentioned humongous appropriation of fund to the ministry is well justified.
In the course of the year, the ministry is therefore expected to efficiently & faithfully deploy the funds for the purpose of stabilizing the exchange rate that has already gone haywire, efficient management of the nation’s debt; both domestic & foreign, responsibly managing the external reserves and more importantly, efficient management of the country’s GDP.
It’s also incumbent on the Minister of Finance, as Co-coordinating Minister of Economy to ensure efficient and effective coordination of economy in all facets, including better economic planning, optimal budget implementation, as well as ensuring efficient collaboration & synergy between Fiscal and Monetary Policies.
Meanwhile, Defense ministry with the highest total allocation of about ₦1.140 trillion, with capital expenditure components of ₦913 billion boldly signify the government intention to completely wipe out banditry, insurgence and other criminalities across the county.
Without a doubt, insecurity over the years has made generality of Nigerians to lose confidence in the impregnability of the nation territorial integrity. The challenge is also affecting the flow of foreign investments into the country, and even, making existing companies relocating to other countries considered safe haven for their operations.
The expectant nation therefore expect the Ministers of Defense, in collaboration with the Service Chiefs to patriotically, faithfully and diligently deploy the humongous allocation to strengthen the security architecture, as well as acquire new equipment efficient and contemporary enough, to comprehensively root out and combat all forms of criminalities that have been holding the nation by the jugular.
During the Year 2024, Defense ministers should equally consider commencing digitalizing Abuja and other strategic & security formations across the country like Lagos, Kaduna, Enugu, etc.
Digitalization of the nation’s treasure base like Port Harcourt, Onne, Warri, Uyo and Eket should as well be paramount.
The overall objective is to properly secure the territorial integrity of the nation, as well as the protection of life and property of the citizenry, in addition with the nation’s treasure base across the land.
Ministry of Communication and Digital Economy with a total budget of ₦160 billion, including capital expenditure component of ₦137 billion is expected to deploy the larger proportion of the allocation to fund the 5 pillars as enunciated in the Minister’s publicized Agenda.
Flowing from this, we expect the minister’s initiatives to start heralding the emergence of the nation’s digital entrepreneurs in the mould of Elon Musk, Mark Zuckerberg, Bill Gates etc.
It’s also expected that the Nigeria would be digitally connected together in all fronts, and more importantly, connect with the entire the entire globe.
Ministry of Works & Housing with allocation of ₦481 billion, including ₦450 billion capital expenditure, is expected to connect country strategic locations with each other, and more importantly with the federal capital territory through networks of modern roads.
It’s also of essence that the ministry should consider linking industrial locations like Lagos, Aba, Nnewi, Kano, Port Harcourt etc with seaports and commercial areas around the country.
Meanwhile, Power ministry’s total allocation of ₦301 billion, including ₦294 billion should be good enough to increase the nation’s megawatts from 3500-4500 to 10000 in a very short while, and with the increase progressively moving up to about 15,000-20,000 within the first year/second year of this administration.
This development could significantly begin the process of reigniting the industrial sector, as well as small & medium scale enterprises and even, millions of households across the nation.
It’s also incumbent on the minister to commence the implementing of the new Electricity Act that has pronounced the decentralization of power from the firm control of NERC, thereby providing ample opportunity for the new private and corporate investors to invest in the sector.
In addition, the nation expect the ministry to commence reviewing the operational activities of the existing DISCOs with a view to renewing the Licenses of the performing ones, as well as discontinuing with those that might have fell short of expectations.
This initiative should equally include reducing the area of coverage of the DISCOs, as the existing arrangement has largely made them to be non-responsive and prompt in service delivery.
A total budget of ₦160 billion that includes ₦137 billion capital expenditure should be good enough for ministry of Communications & Digital Economy to significantly commence funding the Minister’s five (5) pillars program enunciated in his Agenda already in the public domain.
Flowing from this, the nation expect gradual emergence of her own digital entrepreneurs in the mould of Elon Musky. Mark Zuckerberg, Bill Gates etc.
We also expect the country to be digitally connected in all the nooks & crannies, and more importantly, for Nigeria to be digitally efficiently and effectively connected with the globe.
The transport ministry of ₦205 billion and ₦189 billion capital expenditure content, is expected to continue with rail infrastructures spearheaded by the immediate past president.
Meanwhile, President Bola Tinubu should be applauded for his discerning mind, wise thinking and large-heartedness for key in to the developmental initiative of his predecessor, expected to significantly reduce the overwhelming burden on the Nigerian roads.
The rail infrastructure essentially meant to take charge of moving heavy duty equipment across the nation, as well as swift transportation of goods to & fro Apapa, Warri and Onne ports to their various destinations, is a key component of the success story and overall development in transportation segment in developed countries like China, Germany, Great Britain, Germany, and South Korea
Health ministry with total allocation of ₦711 billion and ₦194 billion capital expenditure content is expected to strengthen government health infrastructures and medical facilities, including University Teaching Hospitals across the country.
The initiative is equally expected to significantly reduce the migration/relocation of the nation’s medical personnel to foreign lands for pasture new.
With a whopping appropriation of ₦875 billion, with capital expenditure of ₦174 billion, Ministry of Education is projected to substantially commence addressing the endemic challenge in the nation educational sector across the land.
Niger Delta Region should be in good stead to continue with the developmental initiatives in the zone, with respect to infrastructural initiatives, as well as facilities rehabilitation and renewal with the total allocation of ₦126 billion, with capital expenditure content of ₦25 billion.
Coupled with the allocation above is the humongous of sum of about ₦438 billion already made to Niger Delta Development Commission (NDDC).
Ditto for North East Development Commission (NEDC) that has been allocated the total sum ₦131.836 billion expected to boldly commence the reconstruction and rehabilitation of the collapsed and wrecked infrastructural facilities across the region following the destructive and devastating effects of Boko Haram insurgency and other criminalities in the region.
Humanitarian Affairs and Poverty Alleviation huge appropriation of about ₦494 billion, with capital expenditure of ₦93 billion, could significantly address the needs of Nigerian downtrodden, as well as small & medium business enterprises across the land, if President Tinubu could identify new set of patriotic, selfless, and God fearing Nigerians who are prepared to work in sync with his 7 points Agenda as encapsulated in the Renewed Hope.
Budget implementation is a collaborative efforts and must, as a necessity involve all the stakeholders’ commitment, diligence and patriotism.
Its therefore incumbent on all the stakeholders most especially the top echelon of MDAs to ensure that they work in sync with vision of the president, as well as cooperate with national assembly so that the country could begin a new journey to prosperity, through proper execution of Year 2024 Appropriation Act.
Kola AMZAT (FCA, FCIB),
Lagos based Financial & Management Consultants,
09077509348.
