- Photo caption: Mr. Vahyala Kwaga
A Senior Research and Policy Analyst, BudgIT Foundation, Mr. Vahyala Kwaga has stated that the N28 trillion budgeted for the 2024 fiscal year by the Federal Government should have been increased to about N50 trillion to N60 trillion if the government was serious.
This is just as he asserted that Nigeria as a country is actually not spending enough to stimulate economic growth when compared to other countries of its size in terms of population.
This opinion, he said, is of the BudgIT Foundation, which believes that countries as big as Nigeria are spending more.
The Senior Research and Policy Analyst, BudgIT Foundation, stated this in a roundtable discussion with members of the Financial and Business Online Publishers (FiBOP) in Lagos
He pointed out that the N28 trillion budgeted for the 2024 fiscal year by the Federal Government should have been about N50 trillion to N60 trillion naira if the government was serious.
According to him, “There is a contradiction, on one hand, we are not spending enough and it’s inefficient. On the other hand, we are spending it very poorly. So, there needs for a reconciliation on how we spend and how much we even budget for spending.”
He explained that budgets help the government to actually know how much it intended to spend.
“What this should mean to a layman is the road that you use to go from one state to another to sell your shoes, the money that is spent, the cost of goods that you buy in the market, the security or lack of security that you enjoy, among other things are directly going to be impacted by how much the government spends or does not spend on the budget.
“But Nigerians need to understand that budgets are just statements, they are not really worth anything unless the government goes ahead to spend efficiently and effectively.”
He noted that the Federal Government in the past, had been releasing reports on how well it had carried out its spending for every quarter in what was called the budget implementation report, but regretted that such reports were either no longer available or the government decided to be silent on it where it is available.
He said that Nigerians had to come to a point where they take the budget seriously and understand that their livelihoods and future, their existence as human beings depends to a very large extent on how efficiently and effectively the government spent its money.
“It is not just even about having a budget. Is the money even available?”
“If you recall the issue of deficit, when the government says we want to spend N20 trillion, but we are only going to earn N10 trillion, that means there’s N10 trillion missing. Where is the Government going to get that money from? If it is going to get that money through loans, it means that it is Nigerians through their taxes that will pay for that deficit.
“The governors, National Assembly members as well as former Presidents have very large pensions that can even be taken care of, even if they want to pay tax, very little of that will come from them. But why is it that it is an average Nigerian citizen that will bear the brunt of those debt payments? These are the things that the budget should show. In more ways than one, the budget is very crucial and important and Nigerians only need to take it more seriously going forward,” he said .
Politics, he said, influences economic decisions, but he however, said that there was a body called the Joint Planning Board where the Federal Government and state governments come together to plan even as he disclosed that the Board last met in 2021, one year after the COVID-19 pandemic.
“What is the alignment between what the States are doing with what the federal government is doing? If I as Kaduna State needs and this also speaks to the issue of MSMEs, businesses in my state want to move their goods from point A to point B, but to a very large extent, the roads that they drive on are federal roads, at that Joint Planning Board meeting, I can table this request to the authorities and say, these are my needs. With the fixing of these roads, business will go up by this amount, companies will pay this amount of tax, VAT will bring in this amount and you see the federal government and the state will then be earning more. But there’s no alignment between the federal government and the states.
“When you look at the issue of energy, these are political decisions like I said before. The Minister of Power was saying that the reason the national grid has collapsed is because there’s low gas output. Why is there low gas output? Were they just looking at the gas until it finished? No one raised any alarm that gas is about seventy percent now and so on? People were just folding their hands looking and this has a direct impact on the cost of doing business. So, if businesses are spending fifty to sixty percent of their operating expenses on diesel, there is no way they are going to make money. The government will not even have anything to tax,” he said.
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