- Say budget is gateway to alleviating suffering of Nigerians
- It’s not different from Buhari’s budget of servicing debts – Economists
BY TIMOTHY AGBOR, FESTUS OKOROMADU & BRIGHT JACOB
Some economic and financial experts have said the critical sectors that were majorly prioritised in the 2024 budget of President Bola Tinubu have the capacity to galvanize the nation’s economy if the budget is well implemented.
President Tinubu, while presenting the fiscal document, christened ‘Budget of Renewed Hope’, to a joint session of the National Assembly in Abuja on Wednesday, said Nigeria’s national defence and internal security, local job creation, macro-economic stability, investment environment optimisation, human capital development, poverty reduction, and social security were some of the top priorities of the proposed 2024 budget.
He said the nation’s internal security architecture will be overhauled to enhance law enforcement capabilities with a view to safeguarding lives, property, and investments across the country.
According to the President, the proposed budget prioritises human capital development, with particular attention given to children, because human capital remains the most critical resource for national development.
Reacting to the N27.5 trillion budget, experts advised the Federal Government to pump more funding into creating infrastructures such as electricity and roads, noting that without these key factors, the lofty aspiration of the budget may not be met.
With better funding allocated to infrastructures, they said the country’s business climate would recover from the negative impacts of the recent reforms.
They also advocated for sincere, patriotic and effective implementation of the fiscal document whenever it is approved so that the hardship Nigerians are passing through would be assuaged.
An economist, Olaide Ajibola, described the top priorities of the budget as a gateway to alleviating the suffering of Nigerians, urging President Tinubu and his team to walk the talk and bring the propositions to reality.
“You would agree with me that this is not the first time that budgets will be presented with a litany of promises and plans. It is obvious that the top priorities of this budget are security, job creation, poverty reduction and so on, but our government should know that economic planning doesn’t just happen by magic. That’s why I am calling for a painstaking implementation of the budget and proper allocation of funds.
“If there are key things that could bring these hopes to reality, one of them is for the government to be wise in spending and allocate better funding for infrastructures and productivity. These are the things that will draw investors and create jobs, which will in turn reduce poverty,” he said.
Ajibola added, “Studies of past budgets have shown that it has been very difficult for past administrations to meet their revenue and expenditure target and the variance keeps getting wider ever since the 2014 global collapse in oil prices that sent this country to its first recession. Now, the whole world knows that we can no longer continue to depend on oil to survive. So, I want President Tinubu to change the narrative and ensure that the budget meets its target.”
Also reacting to the latest budget, the National President of the Association of Small Business Owners of Nigeria, Femi Egbesola, said, “The intention behind the budget can be said to be good, especially with the top priorities of the President. But, we expect that enough funding will be allocated to infrastructures such as roads, electricity among others such that the business climate can improve.”
Calling on the Federal Government to hit the ground running immediately the budget is approved and ensure efficient implementation of the budget, Egbesola noted that effective monitoring should be in place to see how effective the budget implementation is.
A Professor of Economics and President of Nigerian Economic Society, Adeola Adenikinju, urged Tinubu to use the budgets to create jobs, reduce poverty and create infrastructural projects in the country.
In his submission, an economist, Israel Odubola, said the N27.5 trillion expenditure and a revenue projection of around N18 trillion leave a deficit of around N9 trillion, which is lower compared to N10 trillion for this year’s budget.
“For the revenue forecasts, N18.3 trillion is ambitious. I don’t think we have done N12 trillion in revenue since 2015. However, we hope Oyedele’s committee on tax reforms and fiscal policy matters will help the government drive revenue mobilisation,” he added.
However, an economist, Kudu Abdalla, faulted the 2024 Budget of Renewed Hope presented to the joint session of the National Assembly on Wednesday.
Abdalla said the budget is not different from the budgets of former President Muhammadu Buhari for eight years because it’s a budget of servicing debts.
“What is the renewed hope in the budget that is filled with deficit? There is definitely nothing new with this budget. All the figures in the budget will not get the country out of the doldrums she is in economically because the government will still be battling with servicing numerous debts. When you budget N27.5 trillion and it is based on borrowing and servicing of debts already borrowed, so, how will it renew the hope of Nigerians?
“You talked about job creation. If we are not deceiving ourselves, what is the government going to create jobs for? Creating jobs when even private sectors are folding up, self-employed and artisans are seriously suffering. Will the budget stabilize the economy when our currency is speedily on a free fall? The President is talking of bringing Naira to N750 per dollar. Is this of any hope? The answer is no. There is nothing to celebrate about the budget as long as it is based on borrowing to finance it.”
The Chairman and Chief Executive of Maxi Funds Limited, Okechukwu Unegbu, said the amount budgeted to be spent is too small to the size of the country.
“To be candid with you I think a budget of N27.5 trillion is insufficient for the level of Nigeria’s development and population. But despite what he said the fact is that the money budgeted to them may not be sufficient. Though I have not read the details of the budget, my take is that he has made a pronouncement which he must strive to keep.
“The problem however, is that he must look at certain key areas that should be tackled urgently to make the economy work. He talked about security, yes that is very important because without security even local investors will not invest in the economy not to talk of foreign investors coming into Nigeria. I set up a school in my village where my wife is running it and I am regretting everything because of insecurity, the village is so hot now that I am afraid for the students because of kidnapping and other things, so one is not sure of what will happen next.
“The next thing for me is he should concentrate on education. He needs to revisit the nomadic school set-up during Goodluck Jonathan’s era. The Nigerian masses should be educated so they can be employable. The student loan issue should be addressed properly, technical and vocational education should be given top priority.
“He should focus on employment generation. The idea of giving out money as a poverty alleviation strategy is wrong, the government should rather employ these people to clear our blocked drainages, sweep streets, set-up large farm settlements where people can work to earn money instead of giving them money which they eat and become poorer. If people are employed the possibility of committing crime will be reduced, not that it will be eliminated. The best the president can do to alleviate poverty is to ensure that unemployment is reduced; inflation is reduced to the minimum.
“In terms of revenue generation, he should work to expand the tax net. The tax net in Nigeria is very narrow because the rate of taxation is high and there are multiple taxations. So my recommendation to the president is for him to reduce the rate of taxation so as to capture more people in the tax net and you get more money than few people paying because it is too high. The President is taking steps to tackle those invading tax, yes tax evasion is illegal but tax avoidance is legal, so people do a lot of things including financial engineering to avoid paying tax but if the tax rate is low people will want to pay tax and therefore you get more money into the tax system.
“That is my recommendation for now, until I read the budget so I can appreciate what he has done,” he stated.
Also speaking Dr. Femi Adegbeyinga, an Abuja based economist and policy analyst commended President Tinubu for the early presentation of the budget to the National Assembly but called for proper scrutiny of the document.
He noted that Nigerians are passing through a tough time following some key policy decisions of the administration hence the need to work the talk in the year ahead.
“Kudos to Mr. President for the early presentation of the 2024 budget. But he and his cabinet should know that the real concern now is how to tackle the serious economic challenge of inflation induced by the removal of fuel subsidies.
“The critical issues are how would the huge resources budgeted be managed where the majority of citizens are living below poverty level.
“Nigerians have painfully accepted the subsidy removal; however the impact of the huge resources that have been freed up is so far not been felt by the majority of Nigerians. Government bigwigs in both federal and state levels now spend ridiculously high amounts of taxpayers’ money on frivolities. This needs to stop.
“The benchmark for the success of your administration will be if an average Nigerian on the street can affirm that his/her life has been positively impacted by your government,” he said.
A financial expert, Solomon Usanga said, “If I have to be frank, I think this budget of Renewed Hope is all hype.
“First of all, it is one of the lowest budgets ever presented by any president judging by the current exchange rate of the naira to the dollar.
“So, in my opinion, I think the government could have done more.
“But of course, this government has been tacitly saying all this while that the last administration ran this country aground.
“Let us, therefore, give the government the benefit of the doubt, and observe how they would turn the situation of Nigerians around with their Renewed Hope budget. But it won’t be easy, I promise you.”
Usanga also said that even though the budget per capita was not encouraging compared to other African economies, implementing the budget “carefully and to the letter” could deliver more than enough for Nigerians.
“Like I said earlier, I don’t expect that the government can perform any major magic on the economy with this 2024 budget. This is because if you also look at the budget in terms of per capita, you would observe that in comparison to some African countries, we are down there and nowhere to be found.
“Suffice it to say that with this budget, among the 10 largest economies in Africa, we will be at the bottom rung of the ladder.
“All the same, I am hoping for the best and have hope because even though small, if implemented carefully and to the letter, the budget has the potential to deliver more than enough for Nigerians,” he said.