By Eze Onyekpere

Laws and policies fix times and schedules for the performance of public duties. These times and schedules are not fixed arbitrarily. They are based on reason, common sense and empirical evidence. Essentially, timing is attached to the purpose and objectives of the public duty to ensure that these objectives are achieved in the overall public interest. This aphorism is applicable to the budgeting process at federal, state and local government levels. Budgets by law are to be prepared and approved before the beginning of the financial year and fully implemented on or before the end of the financial year.

The Constitution of the Federal Republic of Nigeria 199 as amended in the interpretative S.318 defines the Nigerian financial year to mean any period of twelve months beginning on the first day of January in any year or such other date as the National Assembly may prescribe. The Financial Year Act also defines the same as a period of twelve months commencing on January 1 and ending on December 31 of every year. It is clear that the provision is firm and unambiguous. The last part of the constitutional provision; ‘or such other date as the National Assembly may prescribe’ is a provision that allows the National Assembly to reset the financial year if the January to December period is found unsuitable for Nigeria based on empirical evidence. The timing can be amended for instance to run from July to June every year. It is about the power to legislate a new time frame.  That provision did not contemplate that the legislature will be voting to extend the implementation of the federal capital budget every year to either the end of the first, second or third quarter of a new year. Such an exercise is an arbitrary exercise of legislative power which makes the financial year uncertain and changes it from year to year.

The Muhammadu Buhari administration restored the financial year to the January to December period before it left office. However, the Bola Ahmed Tinuu administration appears not mindful of timing in budget preparation, implementation and reporting. The 2023 federal budget and its supplementary version were extended to 2024 and no one is actually sure if the budgets have been fully implemented. The last budget implementation report (BIR) on the website of the Budget Office of the Federation is the third quarter 2023 BIR. The fourth quarter and full year BIR is not available. However, the Fiscal Responsibility Act provides that BIRS have to be prepared and published within one month of the end of every quarter.

There is a huge corruption challenge and risk involved in the implementation of four budgets at the same time viz, 2023 main budget and its supplement and 2024 main budget and its supplement. Implementing four budgets at the same time is a maze of confusion and ministries, departments and agencies will find it difficult to focus and account for project implementation. What about the procurement angle? It is also another level of chaos. Public procurement is planned, implemented and reported upon within the context of a financial year. There ought to be closure after the end of every year in terms of expenditure and reporting. Such level of disorder in purporting to be implementing four budgets at the same time lays a solid foundation for the mismanagement of available resources and grand corruption. There is a plethora of unanswered questions in this scheme of confusion. Did the federal government save the revenues that accrued in 2023 and put them in a special account so as to spend them in 2024? If we have not fully started the implementation of the 2024 capital budget, what happened to the revenues realised for the year and voted for these projects?

For 2024, not even the first quarter BIR has been prepared and the president has just requested and got legislative approval to borrow money for the implementation of the 2024 federal capital budget in the last days of November 2024. If we go by the natural sequence of events that the borrowing process starts after the legislative approval, the implication is that the money will not be available this year or at best, towards the last days of December 2024. This firmly sets the stage for the implementation of the 2024 federal capital budget in 2025. Furthermore, the medium-term expenditure framework which by law should have been presented to the National Assembly on or before September 2024 is about two weeks before NASS. The MTEF is the foundation of the appropriation proposals and it has not been approved by NASS. The 2025 federal budget estimates have not been presented to NASS just about a month to 2024-year end. The implication is that the 2025 federal budget will be enacted late, likely in the first quarter of 2025 and implementation will also be delayed.

The foregoing scenario creates the opportunity for the deployment of common sense, reason and human faculties. If we are still in the process of preparing the 2025 federal budget and the MTEF has not been approved, there is a wonderful opportunity to get back to the constitutional financial year in terms of budget approval, implementation and reporting. The recommendation is straight forward; all capital projects in the 2024 federal budget that are yet to be implemented and which the authorities consider to be still relevant should be the foundation of the 2025 federal budget. New relevant projects should also be part of the 2025 expenditure and revenue plan. With this approach, there will be only one budget available to implemented and reported upon and it will be the 2025 federal budget. This will clear the backlogs and restore sanity to the budgeting cycle. It is up to the executive and legislature to restore timeliness in budgeting.