Another Budget Debacle  

The 2013 Appropriation Bill remains unsigned and enmeshed in a familiar crisis of distortions

Watching President Goodluck Jonathan last Tuesday night as he tightly clutched the African Nations Cup won by Nigeria at a reception for the victorious Super Eagles, Ali Baba, a popular Master of Ceremony, remarked that the President was holding the cup as he was doing to the 2013 Budget. There could not have been a more appropriate comparison. Indeed, going by the instant denial of a story by the Ministry of Finance that the President may sign the budget last week, the President seemed not ready to touch the Appropriation bill, especially in the form it was last week.

Dr. Ngozi Okonjo-Iweala, the Minister of Finance, said President Jonathan would not sign the 2013 Budget into law because there was still much work to be done on it. According to a statement issued last Tuesday by her Senior Special Assistant on Communications, Paul Nwabuikwu, “The Minister of Finance, Dr. Ngozi Okonjo-Iweala, clarified that talk of the President signing the budget this week is premature. Whereas discussions between the Executive and the National Assembly are ongoing in a cordial atmosphere, it is not yet clear when they will be concluded as much work remains to be done.” In a replay of what has now become a routine after the passage of the budget by Nigerian lawmakers, the President has in the past few weeks met with the leadership of the National Assembly over the N4.987 trillion Appropriation bill they passed on 20 December 2012.  Jonathan had addressed a joint session of the National Assembly on 10 October 2012, where he presented the initial proposal of N4.924 trillion in the “Budget of Consolidation and Inclusive Growth”.

But the lawmakers not only increased the figure presented to them by about N63 billion, they also drastically restructured the bill. For one, the lawmakers slashed the N2.41 trillion allocation for recurrent expenditure in the original budget presented to them, to N2.38 trillion, and raised the capital vote to N1.62tn from N1.54 trillion in the original budget. And despite loud protestations from the President, the Minister of Finance and Central Bank Governor, Sanusi Lamido Sanusi, the lawmakers also increased the crude oil benchmark price from $75 to $79 per barrel in the budget they passed on 20 December. The lawmakers had reportedly calculated the amount to be realised from the extra $4 added to the crude oil benchmark and added it to the budget for execution of some of their constituency projects.

Sanusi, at the end of the Monetary Policy Committee, MPC, meeting in Abuja about two weeks ago, reiterated his opposition to the adjustment in the crude oil benchmark by the National Assembly. Sanusi had noted that, “The 2013 budget oil price bench mark, which was increased from $75 to $79, would pose side risks to inflation and, therefore, constitute pressure points for inflation.” The lawmakers had also refused to make any allocation to the Securities and Exchange Commission, SEC, based on the insistence of the House of Representatives that Aruma Oteh, the boss of the Commission, should be removed from office by the Presidency.

Already, a suit has been filed at the Federal High Court, Abuja seeking to declare the 2013 Appropriation Bill awaiting presidential assent as inchoate as a result of the zero allocation given to SEC. The suit, filed by one Ezugwu Emmanuel Anene, has as respondents President Jonathan, Senate President David Mark, the House of Representatives Speaker, Aminu Tambuwal; the Attorney-General of the Federation and the Clerk of the National Assembly. In the originating summons filed on 1 February, the plaintiff argued that the 1999 Constitution stipulated in section 4 (2) 5 (1) that the National Assembly should make laws and legislation for peace, order and good governance of the federation and therefore, by giving zero allocation to SEC, the legislature has failed to make laws for peace, order and good governance. He also argued that the zero allocation to SEC violated sections 1 (1) 8  (2) 13, 19, (1) (2) of the Investment and Securities Act. The plaintiff is also asking the court to declare that the National Assembly has no constitutional powers to give zero allocation to SEC, and a further declaration that by the zero allocation to  SEC, the 2013 Appropriation Bill pending before the President for assent is inchoate.

•Jonathan: Refuses to pass 2013 appropriation bill into law

The Plaintiff further averred that if the court should consider the bill inchoate, it should decide on whether the President could assent to an inchoate bill; and if the answer is no, the court should rule on whether the National Assembly has, by its action, repealed SEC. “This year, we have broken the budget jinx. We were able to submit the budget in record time in September and it was passed on December 20, 2012,” Yerima Ngama, the Minister of State for Finance, said after last week’s meeting of the Federal Executive Council. “They have returned the document to us. We have a few things to sort out before it is signed,” he added.

The problem with the 2013 Budget as passed by the National Assembly is not altogether a new one. As was gathered by this magazine, just like in the past, the executive is accusing the lawmakers of smuggling a lot of extraneous items into the budget, especially in form of constituency projects. Members of both chambers were asked to select projects, with worth not exceeding N50 million, for inclusion in the budget for their constituencies. Some principal officers of the National Assembly, it was learnt, were able to smuggle projects worth much more than N50 million into the budget, a development that is said to be a source of simmering tension among members. This, it was gathered, was responsible for the increase in the capital allocation in the budget passed by the National Assembly. In the process of adjusting the allocations in the budget to take care of their own interests, the lawmakers were said to have adjusted the templates in a way that the allocations to each head was hardly recognisable.

It was learnt that the Federal Ministry of Finance is insisting that the templates in the budget have been so tampered with that it would be virtually impossible to implement. Consequently, it was learnt, the Ministry compared budgets prepared and submitted for inclusion in the budget by the Ministries, Departments and Agencies, MDAs, with what the National Assembly passed. The budget was returned to the National Assembly about two weeks ago when the discrepancies between what the Executive submitted and what the National Assembly passed were considered to be too significant.

Another angle was introduced to the budget row last week when Femi Falana, a prominent lawyer and human rights activist, advised President Jonathan not to sign the 2013 Appropriation Bill as submitted to him by the National Assembly. He argued that the President would be violating the constitution and committing illegality as he will be violating Section 58(4) of the Constitution which states: “Where the President, within 30 days after the presentation of the bill to him, fails to signify his assent, or where he withholds assent, then the bill shall again be presented to the National Assembly sitting at a joint meeting, and if passed by two-thirds majority of members of both Houses at such joint meeting, the bill shall become law and the assent of the President shall not be required.”

“Since the lawmakers passed the budget proposal since December 20, 2012, the refusal of the President to assent to the bill has lasted beyond the mandatory 30 days stated by the constitution. Having not assented to the Appropriation within 30 days of the receipt of the bill, the President is mandatorily required to present the bill to the joint sitting of the National Assembly, which may decide to pass it by two-thirds majority,” Falana said.

However, Victor Ogene,  Deputy Chairman, House Committee on Media and Public Affairs, argued that the constitution has also provided a solution to the problem as it laid out what should be done if the President refused to assent to the budget after 30 days of receiving it from the National Assembly. “The deadline is not yet here. You don’t calculate Saturdays and Sundays because these are non-working days. I also know that there are robust engagements between the executive and legislature and soon the matter will be over,” Ogene said in an interview last week. Indication last week is that the Presidency is involving the big wigs of the ruling party in efforts to resolve the budget impasse.

The President had also initially refused to sign the N4.697 trillion 2012 budget as passed by National Assembly, alleging that what was originally submitted by the Executive had been badly distorted by the adjustments made by the lawmakers. He however signed the budget after what he described as “extensive discussions with the National Assembly”. The President had then warned against distortions in the Appropriation bills sent to the lawmakers. The situation was not different with the 2011 budget, which President Jonathan signed only after the lawmakers agreed to reduce the N4.9 trillion Appropriation bill earlier forwarded to him to N4.4 trillion.

The Executive has consistently argued that the National Assembly members were not constitutionally empowered to do the kind of tinkering they usually did with the Appropriation bill submitted to them year in, year out. Such tinkering, which usually leads to increase in allocation to different sub heads, the executive has also argued, does not usually take into consideration the socio-economic circumstances of the country.  But the lawmakers have argued that as representatives of the people, they cannot be “rubber stamps” to the Executive, especially as it related to the budget.

However, the lawmakers have been embroiled in some scandals relating to manipulation of the budget or increase in allocations to some government agencies in return for financial gratification. There was the infamous N55 million bribe-for-budget scandal which led to the removal of Adolphus Wabara as the President of the Senate in 2005. Others involved in the scam included former minister of Education, Professor Fabian Osuji; then executive secretary of the National Universities Commission, NUC, Professor Peter Okebukola; acting permanent secretary in the Ministry of Education, Mr. P. S. Audu; five directors in the ministry and the then vice-chancellor of the Federal University of Technology, Owerri (FUTO), Professor Jude Njoku, who was alleged to have bribed some lawmakers with the sum of N10 million to increase his university’s vote in the 2004 Appropriation bill. The President Olusegun Obasanjo sacked Osuji and Wabara was impeached by his colleagues as a result of the scandal. The Independent Corrupt Practices and other offences Commission, ICPC, later arraigned Osuji in court on the charge that he offered bribe to the Senate to smoothen the passage of the budget of the Ministry of Education, while Wabara and others were alleged to be recipients of the bribe money.

There have also been instances in which some of the roads or other projects included in the budget by the lawmakers as their constituency projects were discovered to be state or local government responsibilities. Sources insist that this practice has continued among committee members of the National Assembly, who distort the budget by increasing allocations to the MDAs, especially on the promptings of the government agencies. Indeed, President Jonathan had last year vowed to punish government officials found to have colluded with members of the National Assembly in increasing allocations to their organisations.

As matters currently stand, many Nigerians are apprehensive that the impasse over the 2013 Budget has diminished hopes that government will begin its implementation early. Also, the aim of instituting a budget cycle commencing from January to December with the 2013 Budget has now failed. Yet, many believe that the long term solution, as suggested by Falana last week, is for the Executive to approach the Supreme Court to determine the extent of the powers of the National Assembly over the budget.