The National Assembly has replied President Muhammadu Buhari’s criticism of the amendments made to the 2018 budget explaining why certain projects were injected into the budget.
In a 12-page statement titled, ‘The President’s Budget Speech: Our Response” and
signed by the Chairman, Senate Committee on Media and Public Affairs,
Senator Aliyu Sabi Abdullah and Chairman, House of Representatives
Committee on Media & Public Affairs, Honourable Abdulrazak Namdas,
the lawmakers defended their action
Read the full statement below;
The President’s Budget Speech: Our Response
We appreciate the fact that the 2018 Appropriations Law which was
passed by the National Assembly on May 16th, 2018 was signed by
President Muhammadu Buhari on Wednesday, June 20th, 2018.
In his speech at the signing ceremony, certain observations were
raised about the work of the National Assembly and its Constitutional
responsibility to modify and amend the budget estimates submitted to it
by the Executive.
You may recall that when the National Assembly passed the 2018
budget, it gave reasons why the budget was increased and why certain
projects and programmes had to be provisioned for. However, due to
recent developments, it is once again necessary to let Nigerians know
the justification for our actions on the 2018 budget, which were based
on our Constitutional responsibilities.
Adjustments and reductions in the locations, costs and number of
projects approved were made in order to address geopolitical imbalances
that came with the Executive proposal. The introduction of new projects
was done to ensure the promotion of the principles of Federal Character
as contained in Section 14, subsection (3) of the 1999 Constitution of
the Federal Republic of Nigeria as amended which states that “the
composition of the Government of the Federation or any of its agencies
and the conduct of its affairs shall be carried out in such manner as to
reflect the federal character of Nigeria…”
The number of projects had to be increased in order to give a sense
of belonging to every geopolitical zone of the country to ensure
socio-economic justice, equity, fairness, and to command National
loyalty.
Within the context of the provisions of Sections 4, 80 and 81 of
the Constitution, everything that the National Assembly has done is
within its powers.
Furthermore, Chapter 2 of the Constitution emphasizes the need for
balance, inclusivity, and equity in the distribution of national
resources. The annual budget, which symbolizes the distribution of these
resources must reflect the aforementioned values, which we swore to
uphold.
These Constitutional provisions, in addition to a recent Court
judgment, have affirmed the fact that the budget process is a ‘joint
effort’ that must reflect the input of both the executive and the
legislature — the latter being the closest representatives of the
people. However, we are fully aware that the Executive has the exclusive
responsibility to execute all parts of the Appropriation Act once it is
signed into law.
It is our firm belief that if the President had been properly
briefed by his appointees, he would not have raised most of the concerns
that he did in his remarks at the budget signing. It is therefore
inevitable for the legislature to give members of the public an insight
into what transpired during the appropriations process and how we
arrived at the decisions that are contained in the 2018 budget.
With the aforementioned background, let us respond to each of the issues raised.
On the issue of the period when the budget proposal was submitted
and when it was passed by the National Assembly, it is necessary to
remind Nigerians that although the budget was submitted in November, as
at March 15th 2018 (5 months and 8 days after the budget submission), Mr
President was still directing the Secretary to the Government of the
Federation to compel the Heads of Ministries, Departments and Agencies
of the Federal Government to appear before the committees of the
National Assembly to defend their respective budget.
In addition, up till April (6 months after the budget submission),
the Executive was still bringing new additions to the 2018 budget which
the National Assembly in good faith and in the spirit of collaboration
and harmonious working relationship accepted.
More importantly, the 2017 budget, was signed into law on June 5th,
2017 and by the provisions of Section 318 of the Constitution, which
defines the Financial Year as “any period of 12 months beginning on the
first day of January in any year, or other date as the National Assembly
may prescribe” – the 2017 budget lapsed on the 5th of June 2018. This
same provision is replicated in the 2017 Appropriation Act.
It is important to also note that if not for the fact that the 2017
budget elapsed on the 5th of June 2018, the Federal Government would
not have recorded notable capital projects for the just-ended financial
year. This is because the Federal Government only started releasing
funds for capital projects in December 2017 when the funds from the
Federal Government’s loans were released and disbursed to contractors.
On the issue of an Organic Budget Law to improve the budgetary
process, the proposed law is pending in the National Assembly and cannot
be considered without the amendment of Section 81 of the 1999
Constitution (as amended) which gives the President the power to propose
“estimates” at any time in the financial year. Nigerians need to know
that during the last Constitutional Review exercise, the National
Assembly in its wisdom amended this provision and it was approved by
over two-thirds of the State Houses of Assembly.
The new Constitution Amendment requires the President to submit the
budget not later than 90 days to the end of the financial year. As of
today, the President has not yet signed this Constitutional Amendment
Bill which would have helped us to have a proper budget calendar, which
shall eventually lead to the realization of the proposed January to
December budget cycle.
It was stated that the legislature made cuts amounting to N347
billion which were meant for 4,700 projects. Again, these reductions of
N347 billion were made from low priority areas to higher priority areas
to support the generation of employment for our youth by MSMEs. We took
the decision to reduce the funds in some areas in order to ensure
balance and equity in the spread and utilization of our national funds.
Additionally, the figures given amounts of the reductions made by
the National Assembly were unduly exaggerated as we did not make any
substantial reduction on any project to the extent of affecting its
implementation.
To give the exact detail of the projects where we made deductions,
it should be noted that the counterpart funding for the Mambilla Power
Plant, Second Niger Bridge/Ancillary roads, the East-West Road,
Bonny-Bodo Road, Lagos-Ibadan Express Road and Itakpe-Ajaokuta Rail
Project, was reduced by only N3,956,400,290 – which represents only 1.78
% of the total N222,569,335,924 submitted by President Buhari. This
left these projects with N218,612,935,634 which cannot negatively affect
their implementation. This obviously contradicts the claim that these
projects lost “an aggregate of N11.5 billion”.
Specifically:
The counterpart Funding for 3050mw Mambilla Hydropower Project was
reduced from N8.5billion to N8.2billion (a reduction of N300million);
The construction of the Second Niger bridge including access roads
phases 2a and 2b in Anambra and Delta states and other projects in the
South East were reduced from N10billion to N9.1billion (a reduction of
N900million);
The construction of Bodo-Bonny road with a bridge across the Opobo
channel in Rivers State was reduced from N10billion to N8.7billion (a
reduction of N1.3billion);
The funding for the Lagos-Ibadan Expressway was reduced from
N20billion to N18billion (a reduction of N2billion), which would not
significantly affect the construction of the road in one appropriations
cycle;
The Railway Projects (Counterpart Funds): 1. Lagos-Kano (ongoing)
2. Calabar-Lagos (Ongoing) 3. Ajaokuta-Itakpe-Aladja (Warri) (Ongoing)
4. Port Harcourt- Maiduguri (New) 5. Kano-Katsina-Jibiya-Maradi in Niger
Republic (New) 6. Abuja-Itakpe and Aladja (Warri)-Warri Port and
Refinery including Warri new Harbour (New) 7. Bonny deep Sea Port &
Port Harcourt of N162,284,335,924 was retained by the National Assembly
as presented by Mr President; and
The National Assembly increased the aggregate funding for the
East-West Road from N11,285,000,000 to N12,085,000,000 because we
realized the strategic importance of the road to the entire oil
producing areas of our country and the fact that the road project has
lingered for too long;
Addressing the issue of the Second Niger Bridge project, apart from
early works, as of today, there is no existing contract for the Second
Niger Bridge in spite of frequent requests from the National Assembly.
The N900million reduced from the N10billion proposed by the Executive
was deployed to fund ancillary roads that connect to the Bridge. It
should again be noted that the N12.5billion and the N7.5billion
appropriated for the Second Niger Bridge in the 2016 and 2017 budget by
the National Assembly were never utilized for the project.
We also need to call the attention of the public to the fact that
the National Assembly allocated an additional N2billion to the
Enugu-Port Harcourt Expressway project. This was more than the Executive
proposed.
As part of the implementation of the 2017 budget, the contracts for
15 roads were awarded by the Federal Executive Council with no
budgetary provisions. Realizing the importance of these projects, the
National Assembly decided to spread the N3.9billion saved from the
earlier mentioned projects funding to facilitate the take-off of these
projects that include: the rehabilitation of Ikorodu-Shagamu road in
Lagos State; the rehabilitation of 9th Mile-Orakam to Benue Border; and
the general maintenance of Pankshin – Ballang – Nyelleng – Sararele –
Gindiri road in Plateau State, etc.
These are the projects purported to be “project inclusions without
conceptualization.” On these projects, the National Assembly needs to be
commended by Mr President for helping to support the take-off of these
awarded but unfunded projects.
Furthermore, it was stated that the budget of the FCT was cut by N
7.5 billion. This is true. The legislators stand by this decision
because, through its oversight of the Federal Capital Territory (FCT),
the National Assembly discovered that in the 2016 and 2017 budget cycle,
there was a severe non-performance of the budgetary allocations to the
FCT. During the two years in question, over 50% of the funds that were
allocated and released to the FCT were not utilised.
These funds were ultimately returned to the treasury. Hence, in
order to ensure that scarce resources were allocated in accordance to
‘needs over wants’, funding for the FCT which has historically been
under-utilised were allocated to other MDAs that have demonstrated the
capacity to implement their allocation for the development of the nation
and its people. It was part of the allocation that we spread over the
roads for which contracts were awarded with no budgetary allocation.
On the provisions for strategic interventions in the health sector
which were said to be cut by an aggregate of N7.45billion, it is on
record that for the first time since the National Health Act was enacted
in 2014, the National Assembly made provision of an additional
N55billion for funding primary healthcare through the Basic Primary
Healthcare Fund which will be sourced from 1% of the Consolidated
Revenue Fund.
Thus, contrary to the claim that the health sector suffered any
budgetary cuts, we actually provided more funds that will make access to
health services possible for over 180 million Nigerians.
The presence of this provision for primary healthcare will help us
to eliminate the prevalence of maternal, infant and child mortality as
well as create a healthier population. With this increased funding, we
will be able to ensure that all Nigerian children get the necessary
immunization that keeps various diseases away from them and ensure that
mothers are well-catered for during childbirth.
On the issue of the 104 Unity Schools across the nation and the
claim that N3billion was cut from their funding, Nigerians need to know
that after careful consultation by the committees of the National
Assembly with stakeholders in the sector, the National Assembly actually
provided an additional N3.7billion more for meal subsidies in these 104
Unity Schools.
Furthermore, it was claimed that the provision for Construction of
the Terminal Building at Enugu Airport was cut from 2 billion Naira to
500 million Naira and that this will further delay the completion of
this critical project.
However, for the avoidance of doubt, it is necessary to again
clarify that during the budget defense and oversight processes, the
National Assembly discovered that out of the N2billion contract for the
Enugu Terminal Building, N1.7billion had already been paid to the
contractor. And what is left to complete this project is just
N300million.
Hence, the National Assembly approved N500million for the project —
which is even N200million more than was required. We refer Nigerians to
a publication in THISDAY newspaper published in April and titled
“Giving Enugu Airport a Facelift” and written by the newspaper’s
Aviation correspondent, Chinedu Eze, where the Minister of State
(Aviation), Mr Hadi Sirika was quoted as saying “We just last week
released N1.7billion to the contractor and hopefully also, within the
shortest possible time, we will release another N300million for him so
that they can quickly finish the airport terminal. This will bring the
airport to its desired standard.”
In the case of statutory transfers where the increase in the
National Assembly’s budget was isolated, it is important to note that
the increase in the oil price benchmark from the projected $45 to the
actual price of $51 generated additional N523.65 billion for the Federal
Government.
Thus, based on an agreement between the National Assembly and the
Executive as represented by the Ministry of Budget and National
Planning, the additional revenues were allocated among the three arms of
government as follows:
The Executive’s proposal for the National Judicial Council was
N100billion, however, the National Assembly appropriated N110billion
which represents N10 billion increase;
The Executive’s proposal for the Niger Delta Development Commission
(NDDC) was N71,195,023,529, however, the National Assembly appropriated
N81,882,555,891 — which represents a N10,687,532,363 increase;
An additional N33,981,437,188 was also appropriated for the
outstanding liabilities to the NDDC by the Federal Government to enable
the commission to settle some of its contractors that were owed over N1
trillion;
The National Assembly received an additional N14.5billion in funding;
In order to ensure that they are able to meet their mandate, the
National Assembly increased the Public Complaint’s Commission’s budget
from the N4,200,000,000 proposed by the President to N7,480,000,000 —
which represents a N3,280,000,000 increase; and
Lastly, the National Human Rights Commission’s budget was increased
from N1.5billion to N3,013,745,000, which represents a N1,513,745,000
increase.
It is therefore very clear that the three arms of government
benefited from the increase which was mutually agreed on with the
Ministry of Budget and Planning. In fact, we have correspondences
addressed to the leadership of the National Assembly from Ministry of
Budget making requests on how to spread the increment arising from the
Benchmark differentials.
It should be noted that the budget of the National Assembly as at
2014 was N150billion, which is still N10.5billion more than our current
figure despite increased national challenges that requires: frequent
public hearings held on almost a daily basis at high costs; and intense
oversight, which has become more thorough and incisive in order to check
the Executive. The N139.5billion budget of the National Assembly
represents less than 1.5percent of the entire N9trillion budget. Does it
not make sense to use 1.5percent to protect the other 98.5percent?
The public should note that this increase in the legislature’s
budget was also necessitated by the drastic inflation of the last four
years; the need to rehabilitate the National Assembly’s deteriorating
facilities, like the elevators which shut down almost weekly; spending
hundreds of millions to procure diesel to constantly power the entire
complex; and the need to immediately upgrade the security facilities of
the complex. It is important to point out at this juncture that the
collapse of the CCTV system facilitated the mace theft in April.
Finally, the following 24 additions, which were done to the 2018
Appropriations Bill, due to the increase in the benchmark price of oil
were duly appropriated by the National Assembly after full
consultations, and in many cases, requests by the Executive branch
through the Ministry of Budget and National Planning.
S/N Project Name Amount
1 Augmentation to unity schools meal subsidy in Education Sector 3,701,587,104
2 Outstanding liability on exchange rate differential for
2015 & 2016 Bea ongoing remittances to 12 Bea countries
(scholarship) 3,265,720,064
3 Rehabilitation of block C, D, G & H at the
Headquarters and Lagos state office of Federal Ministry Of Industry,
Trade & Investment 1,207,942,115
4 Construction of Kashimbilla/Gamovo multipurpose dam 2,000,000,000
5 Strengthening public health against LASSA fever/other
outbreaks: procurement and installation of incinerators, procurement of
personal protective equipment, ribavirin and laboratory reagents and
training of health personnel, construction of isolation ward at
university of Abuja teaching hospital, Gwagwalada 2,000,000,000
6 Fast Power Programme Accelerated Gas and Solar Power Generation 12,500,000,000
7 Expansion and reinforcement of infrastructure in 11
distribution companies to reduce stranded generation capacity
30,000,000,000
8 Alternative energy development fund 1,000,000,000
9 Completion of headquarters building (FMWA) 500,000,000
10 Construction of 3000 capacity maximum security prison in Abuja (Phase I) 6,031,862,972
11 Procurement of 3 x jf17 thunder aircraft 12,792,939,682
12 Security vote (including augmentation of shortfall in operational funds) for Nigerian Navy 3,000,000,000
13 Department of state security – pensions (including arrears) 6,318,326,710
14 Contributions to international Organisations 11,000,000,000
15 Contingency 2,800,000,000
16 Military operation: Lafiya dole & other operations of the armed forces 3,000,000,000
17 Subscription to shares in international Organisations 11,000,000,000
18 SDG special projects 3 8,000,000,000
19 Contingency (capital) 2,000,000,000
20 Promotion, recruitment & appointment for police service commission 5,393,947,080
21 Additional provision to some security agencies 10,000,000,000
22 Additional provision of 82b naira on critical federal
roads e.g. rehabilitation of Abuja-Kaduna-Zaria-Kano 10b naira,
rehabilitation of Lagos-Badagry-Seme road 4b naira,
rehabilitation/dualisation of Calabar-Itu-Ikot Ekpene-Aba-Owerri Road 7b
92,000,000,000
23 Additional 12b naira to new federal universities 12,000,000,000
24 National Institute for Legislative Studies (NILS) 4,000,000,000
TOTAL 245,512,325,726
It is important to state that on many occasions, Mr President
emphasized to the nation the urgent need to develop our human capital,
which are our people and especially the youth. It is on this note that
the National Assembly should be commended to the degree that most of the
human development projects were captured in the budget by the
legislature.
Nigerians should note that due to the back and forth that we have
experienced in the past, the improvement of the budgetary process should
be a higher priority than trading blames. This trading of blames and
unnecessary scapegoating is not healthy — as it creates needless
conflict between the two arms of government.
Finally, in order to ensure that all Capital Projects in the 2018
budget receive their necessary financing in the 2018 budget, we call on
Mr President to present the borrowing plan to the National Assembly so
that we can approve it.
We, therefore, want to urge all Executive appointees to ensure that
they brief Mr President with the truth and facts of their engagement,
to promote healthy and harmonious relationships between the Executive
and the Legislature.
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