OVERHAULING OUR BUDGET PROCESSES
The chairman of the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), Alhaji Hamman Tukur, recently explained why our national budgets have consistently failed to achieve the stated objectives. He put the main blame on the processes and practices employed by government in preparing budgets.
He said the procedures are premised on wrong projections without a linkage between resource availability and realistic expenditure plan and pattern. The result, he added, is that government's fiscal estimates are conceptualized and programmed to fail even before the implementation stage.
The RMAFC boss who spoke at the 12th Annual Tax Conference of the Chartered Institute of Taxation of Nigeria, held in Abuja, said that budgets in Nigeria have often not followed best practices that can lead to efficiency and accelerate development of the economy. He noted that ideally, a good budget and its successful implementation must involve consulting widely with key sectors that are supposed to be involved in its preparation, passage and implementation. All of these, he said, are often absent in Federal budgets.
The claims by the RMAFC boss is revealing. It amounts to an indictment of all the various organs of government saddled with the responsibility of preparing the budgets. If it is true that these organs of government, especially the budget office in the Presidency and the Federal Ministry of Finance, have not been following appropriate budgeting procedures and practices, it is not surprising why successive budgets have not been able to achieve their target of vibrant economic growth and a positive impact on the people.
As the chairman of such a vital commission, constitutionally mandated to advise government on revenue generation, allocation and fixing of salaries and emoluments for public officers, Alhaji Tukur, is in a good position to know why our budgets have not been working as they should. His claims can hardly be disputed. He noted that these faulty processes and practices have been common since 1999. This probably explains why our country, despite abundant natural resources and human capital, has not been able to use our budgets to stimulate growth and the much needed development.
This is sad. Undoubtedly, a successful budget must not be based on guesswork. It must be anchored on realistic revenue projections and carefully selected projects, with practicable time frames. Short, medium and long term objectives must be clearly delineated. The irony in our budget implementation is that even when it is premised on a good platform, the political will and sincerity of purpose to monitor the implementation to achieve desired objectives are lacking.
The simple message the RMFAC boss is passing is this: our budget articulation is gravely defective and therefore needs urgent review. We should re-structure the budget procedures if our country must net the gains of a good budget. Therefore, we urge those in charge of federal budget formulation to clearly articulate the preferences of the government which must be anchored on the needs of the people.
Our collective experience in the present democratic dispensation shows that the budget prepared is often not the budget presented, while the budget passed is oftentimes not the budget implemented. In other words, our budgets are frequently tinkered with. They are often not based on any scientific benchmark. Figures are either marked up or juggled.
That is voodoo economics. Budgets must follow due process and have realistic projections of expected earnings and expenditure profile. We advise government to take Tukur's revelation as a challenge and immediately commence a review of the entire budget process.