Budget Archives - Centre for Social Justice

Introducing Budgetpedia.ng

Center for Social Justice — Wed, 18 Jun 2025 09:16:12 +0000

Budgetpedia is set up by Centre for Social Justice Nigeria (CSJ) as a single internet portal to serve as a primary and definitive source of information on budgeting in Nigeria containing and displaying all public sector budgeting information at all times.

It seeks to bridge the information gap between citizens and government and to make budget information easily available to all. Budgetpedia is based on a theory of change that access to economic and budget information is the currency for enhanced engagement, value for money interventions and demand for accountability by citizens on duty bearers.

Budgetpedia Contains the following information (1999 Till Date) at the Federal and State levels:

Approved Budgets: Appropriation Acts/Laws, approved estimates and revised versions where applicable.

Budget Implementation Reports: Implementation reports of approved budgets for each state and the federal level. This is in the form of monthly, quarterly, mid or full year reports as the case may be.

Other Budget Documents: Documents which accompany the proposed and approved budgets for each state and the federal level; for example, the budget speech presented by the President/Governor to the Legislature.

Accountant General’s Report: Yearly financial statements at the federal and state levels.

Auditor General’s Report: Yearly reports on the Accountant General’s financial statement at the federal and state levels.

Debt Management Reports: Debt Profile, Debt Sustainability Analysis, Annual Reports.

Budget Laws: Constitutional provisions on budgeting, Acts and Laws on Public Procurement, Fiscal Responsibility, Revenue, Taxation as well as subsidiary laws, regulations, guidelines, etc., at the federal and state levels.

Budget Policies: Policies, Plans and Principles relevant to budget formulation, implementation, reporting, monitoring and evaluation at federal and state level including Development Plans, medium term expenditure frameworks (MTEFs), medium term sector strategies (MTSS), Open Government Partnership Commitments, etc.

Case Law: Judgements of Superior Courts related to the budgeting process at federal and state level.

Budget Publications: Publications of reputable scholars, practitioners and organisations on the budgeting process.

The post Introducing Budgetpedia.ng appeared first on Centre for Social Justice .

Where is the 2025 Appropriation Act, Fiscal Risk Appendix and Measures on Cost Control?

Center for Social Justice — Fri, 30 May 2025 16:34:23 +0000

The Budget Office of the Federation (BOF) is charged inter alia with the responsibility of ensuring transparency and accountability in budgeting and federal government’s fiscal operations. In accordance with the Fiscal Responsibility Act (FRA), the BOF is even at the centre of monitoring and evaluating the implementation of the annual budget, assessment of the attainment of fiscal targets and reporting thereon on a quarterly basis. However, the BOF seems to be abandoning the transparency aspect of its duties.

As at the 7^th day of May 2025, the BOF deliberately failed, refused and neglected to upload the 2025 Appropriation Act to its website. The only document on the 2025 federal budget available on the website is the schedule to the Act which contains the details of the allocations to the various ministries, departments and agencies (MDAs) of government. But the legal authorization for the expenditure being the Appropriation Act has been kept away from the public. Two schedules of the Appropriation Act have been uploaded to the BOF website – https://budgetoffice.gov.ng. The stamp mark indicating the date of upload of the schedules to the website reads March 19 2025 while the second reads March 25 2025.

By a freedom of information request from the Centre for Social Justice (CSJ), the organization brought to the notice of the BOF the fact that the Appropriation Act is not on their website. Before the FOI request, a visit to the BOF to get the Act and to remind them that it is not available to the public was met with an affirmation by the BOF that the document is on their site. However, they refused to be a party to opening the site to show exactly where they posted the Act. In response to the FOI, they gave CSJ an electronic copy of the Act and still refused to upload same to their website. This raises the poser on the rationale for the decision to keep the Appropriation Act away from the Nigerian public. Did any law or policy grant a discretionary power to BOF to decide on whether to withhold fiscal information from the public? The author is not aware of any such law or policy.

It is important to understand the nature of an Appropriation Act and the reason why it should be in the public sphere. It is that law resulting from the appropriation process provided in sections 81 and 121 of the 1999 Constitution at the federal and state levels respectively. The bill leading to the Act is usually prepared by the executive and approved by the legislature. Ideally, between the preparation by the executive and approval by the legislature, there should be opportunities for popular participation and citizens input into the process. Legislative hearings, memoranda submission to the executive, etc., should be part of the process. Pray, the public that participated in the process leading up to the conversion of the bill into an Act have every reason to see the outcome of the process in which they participated.

What emerges from the appropriation process is an authorization to spend public funds, to raise revenue and the conditions and formalities precedent and contingent issues for the budget. Thus, there is a broad definition of the respective expenditure categories, details of the fiscal terms guiding the budget and sometimes, it contains the basic assumptions and key macroeconomic indicators. A typical Appropriation Act contains the following vis, authority to spend a specific sum of money within a specific tenure – usually the financial year stipulated by law, release of funds from the consolidated revenue fund, procurement and due process certification, virement, excess revenue, information to be submitted by the executive to the legislature on internally generated revenue, domestic or foreign assistance, etc. Furthermore, it contains the details of the fiscal framework in terms of sources of revenue, whether the budget is surplus or deficit, debts and borrowing, deductions, aids and grants. It therefore contains important information from the approved medium-term expenditure framework which undergirds the budget. The schedule(s) to the Act are the budget details which most Nigerians refer to as the budget.

In the light of the foregoing, this is not a document that should be hidden from the public because it is the basis of public revenue and expenditure and the authorization given by the legislature to the executive for resources to execute development projects, maintain law and order and take charge of issues that affect everyday life in a country.

Also, in accordance with the FRA, annual budget estimates and the Appropriation Bill from the executive to the legislature should be accompanied by measures on cost, cost control and evaluation of results of programmes financed with budgetary resources and a Fiscal Risk Appendix evaluating the fiscal and other related risks to the annual budget and specifying measures to be taken to offset the occurrence of such risks. Measures on cost and cost control should be prescribed in the Appropriation Act while measures to be taken to offset the occurrence of identified fiscal risks should also be part of the approved Appropriation Act. These measures re-echo now that the key assumptions of the 2025 budget and fiscal reality are at cross roads. The benchmark price and the daily production quota are at variance with the oil industry reality. From the Appropriation Act available to the author, no provision was made by either the executive or legislature on any of these demands of the FRA.

BOF is hereby called upon to immediately upload the Appropriation Act to its website. This deliberate attempt to deny Nigerians of their right to know is a gross violation of the provisions of the Constitution and the FRA and should not be allowed to continue for a day longer. If the individuals charged with the responsibility of pushing out this information to the public are unwilling to perform this duty, there is only one option left or them – they should resign.

The post Where is the 2025 Appropriation Act, Fiscal Risk Appendix and Measures on Cost Control? appeared first on Centre for Social Justice .

Appropriation Act, 2025

Center for Social Justice — Fri, 30 May 2025 16:14:45 +0000

APPROPRIATION ACT, 2025

EXPLANATORY MEMORANDUM

This Act authorises the issue from the Consolidated Revenue Fund of the Federation the total sum of N54,990,165,355,396 (fifty-four trillion, nine hundred and ninety billion, one hundred and sixty-five million,three hundred and fifty-five thousand, three hundred and ninety-six Naira) only, of which 3,645,761,358,925 (three trillion, six hundred and forty-five billion, seven hundred and sixty-one million, three hundred and fifty-eight thousand, nine hundred and twenty-five Naira) only is for Statutory Transfers, N14,317,142,689,548 (fourteen trillion, three hundred and seventeen billion, one hundred and forty-two million, six hundred and eighty-nine thousand, five hundred and forty-eight Naira) only is for Debt Service, N13,588,009,682,673 (thirteen trillion, five hundred and eighty-eight billion, nine million, six hundred and eighty-two thousand, six hundred and seventy-three Naira) only is for Recurrent (Non-Debt) Expenditure while the sum of N23,439,251,624,250 (twenty-three trillion, four hundred and thirty-nine billion, two hundred and fifty-one million, six hundred and twenty-four thousand, two hundred and fifty Naira) only is for contribution to the Development Fund for Capital Expenditure for the year ending on the 31st day of December, 2025.

Appropriation Act, 2025 (1150 downloads )

The post Appropriation Act, 2025 appeared first on Centre for Social Justice .

2025 Appropriation Act, fiscal risk and cost control measures

Center for Social Justice — Mon, 12 May 2025 09:02:19 +0000

SUN NEWSPAPER

2025 Appropriation Act, fiscal risk and cost control measures

By Eze Onyekpere

As at the 7th day of May 2025, the BOF deliberately failed, refused and neglected to upload the 2025 Appropriation Act to its website. The only document on the 2025 federal budget available on the website is the schedule to the Act which contains the details of the allocations to the various ministries, departments and agencies (MDAs) of government. But the legal authorization for the expenditure being the Appropriation Act has been kept away from the public. Two schedules of the Appropriation Act have been uploaded to the BOF website – https://budgetoffice.gov.ng. The stamp mark indicating the date of upload of the schedules to the website reads March 19 2025 while the second reads March 25 2025.

It is important to understand the nature of an Appropriation Act and the reason why it should be in the public sphere. It is that law resulting from the appropriation process provided in sections 81 and 121 of the 1999 Constitution at the federal and state levels respectively. The bill leading to the Act is usually prepared by the executive and approved by the legislature. Ideally, between the preparation by the executive and approval by the legislature, there should be opportunities for popular participation and citizens input into the process.Legislative hearings, memoranda submission to the executive, etc., should be part of the process. Pray, the public that participated in the process leading up to the conversion of the bill into an Act have every reason to see the outcome of the process in which they participated.

What emerges from the appropriation process is an authorization to spend public funds, to raise revenue and the conditions and formalities precedent and contingent issues for the budget. Thus, there is a broad definition of the respective expenditure categories, details of the fiscal terms guiding the budget and sometimes, it contains the basic assumptions and key macroeconomic indicators. A typical Appropriation Act contains the following vis, authority to spend a specific sum of money within a specific tenure – usually the financial year stipulated by law, release of funds from the consolidated revenue fund, procurement and due process certification, virement, excess revenue, information to be submitted by the executive to the legislature on internally generated revenue, domestic or foreign assistance, etc. Furthermore, it contains the details of the fiscal framework in terms of sources of revenue, whether the budget is surplus or deficit, debts and borrowing, deductions, aids and grants.It therefore contains important information from the approved medium-term expenditure framework which undergirds the budget. The schedule(s) to the Act are the budget details which most Nigerians refer to as the budget.

Also, in accordance with the FRA, annual budget estimates and the Appropriation Bill from the executive to the legislature should be accompanied by measures on cost, cost control and evaluation of results of programmes financed with budgetary resources and a Fiscal Risk Appendix evaluating the fiscal and other related risks to the annual budget and specifying measures to be taken to offset the occurrence of such risks. Measures on cost and cost control should be prescribed in the Appropriation Act while measures to be taken to offset the occurrence of identified fiscal risks should also be part of the approved AppropriationAct. These measures re-echo now that the key assumptions of the 2025 budget and fiscal reality are at cross roads. The benchmark price and the daily production quota are at variance with the oil industry reality. From the Appropriation Act available to the author, no provision was made by either the executive or legislature on any of these demands of the FRA.

Categories: Opinion

The post 2025 Appropriation Act, fiscal risk and cost control measures appeared first on Centre for Social Justice .

Online Asset Declaration System

Center for Social Justice — Tue, 22 Apr 2025 15:22:47 +0000

Reforming Nigeria’s Assets Declaration Framework:

Policy Brief No. 1, April 2025

The Case for the full Implementation of the Online Assets
and Liabilities Declaration System in Nigeria

Introduction
Articles 8 (5) and 52 (5) of the United Nations Convention against Corruption (UNCAC)
provides as follows:
Each State Party shall endeavour, where appropriate and in accordance with the fundamental principles of its domestic law, to establish measures and systems requiring public officials to make declarations to appropriate authorities regarding, inter alia, their outside activities, employment, investments, assets and substantial gifts or benefits from which a conflict of interest may result with respect to their functions as public officials.
Each State Party shall consider establishing in accordance with its domestic law, effective financial disclosure systems for appropriate public officials and shall provide for appropriate sanction for non-compliance…
Also, article 7 of the African Union Convention against Corruption mandates States Parties to:
Require all or designated public officials to declare their assets at the time of assumption of office, during and after their term of office in the public service.
The implication of the foregoing provisions is that Nigeria, as a state party to these treaties, is under obligation to establish a regime for declaration of assets, liabilities and conflict of interest as a subset of the general anti-corruption regime. Nigeria is expected to bring her domestic law in alignment with her treaty obligations under UNCAC, either
before ratifying the treaty or shortly thereafter. Domestic law cannot be pleaded as defence to the violation of internationally agreed principles.

However, it has a margin of discretion within the treaty obligation in the design of the asset disclosure regime. It may be manual or online.
A typical assets and liabilities declaration regime is made up of five different parts namely, compiling the list of persons and officials bound to declare assets; what they should declare; the submission process; verification of submitted information; recourse and enforcement mechanisms. In reviewing assets and liabilities declaration practices and
policies under constitutional and statutory provisions, it is pertinent to identify the gaps and mischief while advancing remedies to ensure greater compliance with the law.
Questions will arise which are related to the overall compliance rate by persons who have a legal obligation to declare their assets; what is the rate of verification or what percentage of declared assets is verified by the Code of Conduct Bureau? What are the challenges faced by declarants? Are the resources available to the Bureau enough to properly
manage the regime for the number of declarants involved? etc. The review process should also learn from empirical evidence as well as fit and good practices from other comparable jurisdictions. The review should be directed inter alia at improving the efficiency and effectiveness of the declaration regime whilst improving transparency and
accountability.

Extant Domestic Law Position
The Constitution of the Federal Republic of Nigeria 1999 (Constitution) provides an enforceable Code of Conduct (Code) for public officers.

This Code covers issues of prevention of conflict of interest, illicit enrichment, bribery and corruption, influence peddling, membership of certain societies and acting through agents, fronts and
nominees.

The Constitution makes it mandatory for all public officers to declare their
assets and liabilities. It specifically states:

Subject to the provisions of this Constitution, every public officer shall within three
months after the coming into force of this Code of Conduct or immediately after
taking office and thereafter –
(a) at the end of every four years; and
(b) at the end of his term of office.
submit to the Code of Conduct Bureau a written declaration of all his properties, assets and liabilities and those of his unmarried children under the age of eighteen years.

The definition of public officers for the purpose of the Code is all encompassing starting from the President of the Federal Republic to the cleaner in a local government office .
Essentially, it covers all persons on the payroll of the federal, state and local governments.
Informed estimates indicate that the number will not be less than five million Nigerians.
The Constitution establishes the Code of Conduct Bureau (CCB or Bureau) which is mandated inter alia to:

(a) receive declarations by public officers made under paragraph 12 of Part 1 of the Fifth Schedule to this Constitution;
(b) examine the declarations in accordance with the requirements of the Code of Conduct or any law;
(c) retain custody of such declarations and make them available for inspection by any citizen of Nigeria on such terms and conditions as the National Assembly may prescribe;
(d) ensure compliance with, and where appropriate enforce the provisions of the Code of Conduct or any law relating thereto;
(d) receive complaints about non-compliance with or breach of the provisions of the Code of Conduct or any law in relation thereto, investigate the complaint and,
where appropriate, refer such matters to the Code of Conduct Tribunal.

The Constitution has therefore defined the category of persons bound to make a declaration of assets and liabilities, the fact that the declarations have to be verified, the enforcement mechanism for violations of the Code and disclosure of assets and liabilities declarations to Nigerians. The items to be declared have been stipulated by the Bureau
in the Assets Declaration Form.
However, despite the provisions of the Freedom of Information Act, Nigerians do not have access to the assets and liabilities declarations
because the Bureau and the lower Courts hold on to the view that the National Assembly is yet to prescribe the terms and conditions for access to the declarations. They contend that a specific law on access to assets and liabilities declarations is needed.
Furthermore, the Constitution was silent on the process of submitting the declaration of assets and liabilities. This has been provided for in S.15 (1) of the Code of Conduct
Bureau and Tribunal Act

(Act) which supplements the constitutional provision on the

Code and assets and liabilities declaration. It states that:
Every public officer shall within fifteen months of the coming into force of this Act or immediately after taking office and thereafter.
Submit to the Bureau a written declaration in the form prescribed in the First Schedule to this Act, or in such form as the Bureau may from time to time specify, of all his properties, assets and liabilities and those of his spouse or unmarried children under the age of eighteen years.

In the First Schedule to the Act, there is a form to be filled and submitted manually to the Bureau. However, the underlined words show that the Bureau in its discretion, has the power to specify any other form for submission of declarations. The manual assets declaration form contains a jurat, which requires the declaration to be made before a High
Court Judge. However, there is no need for such protocol. An affirmation in the flowing format suffices:
I affirm that the information provided on my Declaration is true and correct to the best of my knowledge and belief. I make this solemn declaration conscientiously believing the same to be true and correct by virtue of the provisions of the Oaths
Act.

It is imperative to state that the Constitution has already provided for truthful and honest declarations considering that paragraph 11 (2) of the Fifth Schedule to the Constitution
provided as follows 11:
Any statement in such declaration that is found to be false by any authority or person authorised in that behalf to verify it shall be deemed to be a breach of this Code.
The Constitution provides a recourse mechanism for the trial and punishment of any person who supplies false information on his declaration of assets and liabilities.
So, whether there is a deposition on oath or not, providing false information in a declaration has been outlawed and made punishable under the law.

Nigerian Online Assets Declaration
From the foregoing analysis of the method and process of submitting assets declarations under the extant law, there is nothing barring the Bureau from introducing and adopting
the Online Assets and Liabilities Declaration System (OADS). It is now a question of activating the already designed OADS and ensure that it suits the need of all Nigerians – from the CCB being the regulator, to public officers who are declarants and the tax payer and the treasury that bears the cost of running an efficient and effective assets declaration
system.
It is on record that Nigeria, through the CCB, has been designing the OADS in the last ten years. A lot of public funds and international donor support had gone into the design and these funds have been channeled into software design, relevant hardware, training and other preparations for the commencement of the OADS. But what are the contours
of the Nigerian OADS.
Benefits Accruable from a Nigerian OADS
4.1 Ease of Compliance for Declarants: The introduction of the OADS will make it easy for declarants to comply with the constitutional requirement to declare their assets and
liabilities. With enhanced access to digital technology and data services across the country, it will be easy for declarants to use computers and possibly cell phones to fill the forms and submit same online. The declarant will access the forms online, complete the form on or offline but submits the form online. Even corrections, rectifications and additions will be easily done online without undue costs and burden. The online process
will save transport and logistics costs of approaching the offices of the Bureau to collect and return filled forms.

The post Online Asset Declaration System appeared first on Centre for Social Justice .

Making the 2023 health budget proposal work

Center for Social Justice — Mon, 28 Nov 2022 10:25:25 +0000

There are so many challenges with the federal health budget proposal for the year 2023. If approved by the National Assembly in its current form and substance, Nigeria’s health indicators may worsen and the expenditure will not produce value for money. The traditional approach of health enthusiasts is to demand increased funding but it needs to be emphasised that we need to get more value from the extant and available resources.

It is imperative to start this discourse with the revenue potential and capacity to contribute to the public expenditure of health ministries, departments and agencies. The major poser is the basis of the retained revenue projections of agencies in the health sector budget. Is it based on the empirical evidence of previously retained revenue or the proposals of the agencies, or the calculation of the ministry or Budget Office of the Federation/Ministry of Finance? For instance, the University College Hospital, Ibadan has a projection in excess of N4bn in the proposed 2023 health budget while the Lagos University Teaching Hospital has a projection of a paltry N48m and the Ahmadu Bello University Teaching Hospital only N8.1m. The gap is very wide and unaccounted for. Many health agencies that should contribute to the revenue have zero contributions. There should be a transparent, accountable empirical standard, on the basis of which these teaching hospitals and other agencies operate. As such, the variance between their respective retained revenue should be within respectable margins. Beyond teaching hospitals, this empirical approach should be applicable to the retained revenue of other agencies under the ministry.

Out of the ministry’s total capital vote of N404.075bn, the sum of N319.667bn is reserved and programmed for the ministry’s headquarters. This is 79.11 per cent of the entire capital vote. However, the headquarters’ share of the entire health vote is 29.76 per cent. This is the over-centralisation of resources at the headquarters. It should be disaggregated and only those resources needed for operations at the headquarters should be retained and others sent to the responsible agencies.

There are allocations of huge sums of money without details at the ministry’s headquarters totalling N310.252bn. This opacity is usually the foundation of the absence of value for money and creates opportunities for the mismanagement of funds. These include ERGP25195089 on Multilateral/Bilateral Tied Loans-Nigeria COVID-19 Preparedness and Response Project-World Bank in the sum of N43.557bn; Multilateral/Bilateral Tied Loans-Accelerating Nutrition Results in Nigeria-World Bank in the sum of N24.5bn; ERGP25195091 Multilateral/Bilateral Tied Loans-Immunization Plus & Malaria Progress by Accelerating Coverage and Transforming Services-World Bank in the Sum of N67.966bn; and ERGP25195092 on Multilateral/Bilateral Tied Loans-Nigeria COVID-19 Preparedness and Response Project-Additional Financing-World Bank in the sum of N174.228bn. There is also the provision for special interventions in Sustainable Development Goals one and two under Service Wide Votes in the sum of N55bn and N10bn respectively. These interventions would definitely include SDGs on health. However, there are no details and disaggregation beyond the lump sum provisions.

This is not acceptable in this day and age. The details of all bulk votes without details totalling N310,252,155,300 and the service-wide votes for health should be provided to the National Assembly and made public to the Nigerian people.

The Nigeria Family Planning 2030 Commitment states, “By the end of 2030, Nigeria envisions a country where everyone including adolescents, young people, populations affected by crisis and other vulnerable populations are able to make informed choices, have equitable and affordable access to quality family planning and participate as equals in society’s development.” Nigeria promised to improve financing for family planning by leveraging both existing and additional innovative domestic mechanisms but there is virtually no provision for FP in the health proposal. However, Nigeria had committed and cost the sum of family planning for 2023 to N24.881bn. According to the Nigeria Family Planning 2030 Commitment, the health budget should make provision for the sum of N24.881bn to meet the policy standard.

The National Strategic Plan of Action for Nutrition (2021 – 2025) Intervention projects a moderate and ambitious scenario. The moderate in 2023 is to cost N39.5bn while the ambitious will cost N57.5bn. The bulk of the resources provided for nutrition is Multilateral/Bilateral Tied Loans- ANRN-World Bank in the sum of N24.5bn. However, funding nutrition and its related projects with borrowed money are not sustainable in the short, medium to long term. And the funding neither meets the moderate nor ambitious scenario targets. The budget should meet the target.

Maternal newborn and child health constitutes a core content of the right to health as well as the minimum core obligation of the state. It is very strategic for the realisation of the rights of women, girls and the rights of the child. Essentially, it is a part of the right to health that is very inseparable from the right to life, from the context of dealing with life-bearing and life-saving issues. Considering Nigeria’s poor MNCH indicators, it is evident that the proposed vote of N19.371bn (calculated from all MNCH related expenditure in the ministry) will not be sufficient to deal with existing and emerging challenges. This needs to be increased.

There are expenditure heads considered frivolous, inappropriate and wasteful totalling N1.666bn. Considering the huge deficit funding requirement of the 2023 federal budget, expenditures should be targeted at yielding the best value for money. There is a “one-stop special publication on the achievement of the Federal Ministry of Health and all its agencies” in the sum of N110m. A one-stop special publication should not cost this much. There is already a vote for the publication of the annual state of health in accordance with the National Health Act- ERGP25156739. There is the “articulation of policies and strategic plans for retention of medical and health workers to stem brain drain in Nigeria” in the sum of N159.669bn. This is a waste because everyone knows why they are leaving and the government is not ready to address the issues. There is a redundant demand for vehicles including Prado jeeps. All these sums should be saved and re-programmed to the already identified areas in need of more funding.

In conclusion, the budget needs to be reworked and critical issues prioritised. Nigeria cannot be doing the same things over the years and reaping failure and still refusing to change.

The post Making the 2023 health budget proposal work appeared first on Centre for Social Justice .

CSJ Publishes Review Of 2022 Subnational Agric Budgets, Implementation Report

Center for Social Justice — Mon, 07 Nov 2022 09:11:05 +0000

The Centre for Social Justice has published a budget review and half year budget implementation report for projects of interest to smallholder women farmers at the federal level and 5 focal states of Anambra, Oyo, Jigawa, Niger and Nasarawa

The review disaggregates the federal and the 5 focal states of Anambra, Oyo, Jigawa, Niger, Nasarawa vote for Agriculture for the 2022 financial year. The project has funding from the International Budget Partnership (IBP).
It reviews the division into recurrent and capital expenditure, the components of the recurrent expenditure, and the disaggregation into administrative and developmental capital expenditure.

It reviews the extent of implementation, up to the end of the second quarter of 2022, in terms of the release of the funds for the projects that have been identified to be of interest to small scale-women farmers. It ends with a capital budget monitoring documentation from members of the Small Holder Women Farmers Organization in Nigeria (SWOFON) in the states.
There are still credibility challenges associated with the implementation of the budgetary votes to agriculture, especially in projects of interest to small-scale women farmers. The state governments need to work hard to close the gap.

Our Lead Director, Eze Onyekpere noted that small-scale women farmers constituted 60 per cent of the farming population and produced 70 percent of food consumed nationally and there was need for an improved budgetary investment for smallholder women farmers, saying this would aid agriculture value chain.

“All plans and policies are based on budget and there are several plans and policies which have shown the need for investment for small-scale medium farmers.’’

It is therefore important that funds appropriated for smallholder women farmers go to them directly and not diverted into wrong hands.
In the proposed 2023 federal budget, the Ministry of Agriculture and Rural Development presents an interesting case study. Year after year, the same kind of provision is made and at the end of the year, there are no clear deliverables. There is a vote for the provision and installation of solar-powered streetlights in rural communities in the 6 geo-political zones at N849.877million; construction of feeder roads in rural communities in the 6 geo-political zones costing N2.613bn. Where are these projects located? This kind of vote provides opportunities for massive corruption considering that budget monitors cannot just wake up and start going across the federation in search of projects without location. Another vote in the sum of N14.809bn is for multilateral/bilateral tied loans – rural access and agricultural marketing projects. The RAAMP project has been ongoing for so many years. Can Nigerians get an account of what has been achieved with the loans and the counterpart funding from the budget? The usual value chain provisions are made but they are all hanging and have no clear deliverables.

The post CSJ Publishes Review Of 2022 Subnational Agric Budgets, Implementation Report appeared first on Centre for Social Justice .

Analysing the 2023 health budget proposal

Center for Social Justice — Mon, 07 Nov 2022 07:28:51 +0000

This discourse reviews the federal health budget proposal for the financial year 2023. This review is done against the background of the Abuja Declaration of African Heads of State, Nigeria’s poor health indicators, and the challenge implicit in the inextricable link between the right to health and the right to life. It ends with some key recommendations.

The total sum allocated to the Ministry of Health out of the overall expenditure of N20.507tn is N1.097tn inclusive of the N47.649bn provided for the Basic Health Care Provision Fund. This is 5.35 per cent of the proposed budget expenditure. This is just about one-third of the 15 per cent Abuja Declaration commitment. However, there are other provisions related to health in the budget vis, provisions for the National Health Insurance Scheme fund of MDAs (N105.797bn), NHIS for military retirees (N4.481bn), NHIS for Corps members (N5bn) and GAVI/Immunisation counterpart funding (N69.570bn).When the foregoing is added to the allocation of the Ministry of Health, it comes up to N1.282tn which is 6.25 per cent of the proposed expenditure. This is still less than 50 per cent of the Abuja Declaration commitment.

Considering the fluctuating value of the naira, it is imperative to convert the allocations over the years to a more stable currency. Using the official rate of the Central Bank of Nigeria, the health votes have been undulating since 2015. In the years 2015, 2016, 2017, 2018 and 2019, it was $1.367bn, $1.269bn, $997.3m, $1.168bn and $1.221bn respectively. In 2020, 2021, 2022 and the 2023 proposal, it was $1.093bn, $1.332bn, $1.723bn and $2.647bn respectively. Evidently, the proposal for 2023 is the highest figure. The right to health is a forward-ever, backward-never right which demands continuous improvements in the pursuit of the highest attainable state of physical and mental health. From the benefits of scientific progress and emerging knowledge, the goal-post keeps shifting in the positive direction and implies a demand for improvements in financing.

If the votes that were not captured in the proposal of the Ministry of Health are removed, recurrent expenditure got 57.3 per cent of the votes while capital expenditure got 36.8 per cent of the health allocation. As usual, the recurrent vote is 98.1 per cent personnel, while only a paltry 1.9 per cent goes to overheads. This recurrent mix cannot facilitate functional health institutions that focus on effective service delivery when the overhead costs are simply not provided for.

There are concerns around the 1 per cent Consolidated Revenue Fund for Basic Health Care Provision Fund in the 2023 FGN budget proposal. The N47,649,312,042 provided for the BHCPF was included in the vote of the Ministry of Health instead of the statutory transfer as stipulated in the National Health Act. This poses a challenge because section 28 of the Fiscal Responsibility Act stipulates as follows regarding the duties of the finance minister on budgetary matters:

“Where, by the end of three months, after the enactment of the appropriation Act, the minister determines that the targeted revenues may be insufficient to the fund the heads of the expenditure in the Appropriation Act, the minister shall, within the next 30 days of such determination, take appropriate measures to restrict further commitments and financial operations according to the criteria set in the Fiscal Risk Appendix- such provisions shall not apply to statutory or constitutional expenditure.”

The above implies that if there is a paucity of resources for budget implementation, the vote provided for BHCPF would be subject to budget cuts alongside other budget lines that are not statutory transfers. This is very likely to happen considering the huge deficit financing of the 2023 budget. Therefore, the Federal Government should ensure that the BHCPF is captured appropriately under statutory transfers so that it can get the priority it deserves in the event there is a paucity of funds. It is even expected that funding for the BHCPF should be ring-fenced to the extent that it should not lapse at the end of the year (including undisbursed parts of the vote) but be carried over to the next. If Nigeria’s health indicators are frightening, why return money to the treasury or keep back budgeted funds in any year?

Surprisingly, the take-off grant in the Special Intervention Fund for the Vulnerable Group Fund provided in section 25 of the National Health Insurance Authority Act was missing from the health budget proposals. It is also not provided in the Service Wide Votes. The implication is that the Federal Government is not ready to kick-start the fund considering that the BHCPF, which is one the sources of its funding, is merely recycling existing resources already created by the National Health Act. It is not new, or more money for health. The imperative of this special intervention fund is the leveraging power it can bring to bear on the VGF. The activation of the Fund and indeed the compulsory health insurance regime of the National Health Insurance Authority are expected to pool trillions of naira every year in new funds to the health sector. The minimum the government can do at this time of lean resources is to activate this new source of funding, which can reduce the pressure on unavailable public finances.

The Minister of Finance has given hints on the 2022 Finance Bill. The expectation is that the bill should be used to right the wrongs meted out to the health sector over the years. Any tax, such as the sugar tax or aggravated excise duties on tobacco or any other tax justified and premised on the health of the population, should be dedicated to the health sector. It is unconscionable to use the health of the population to raise a tax and then put the money at the disposal of the bottomless pit of the general treasury where the proceeds of such tax can be frittered away on frivolous, inappropriate, wasteful, and sometimes illegal, and illegitimate expenditure. The executive and legislature should simply do the right thing.

In conclusion, the 2023 federal budget must ensure more money for health while tightening the loopholes to ensure greater value for health from all budgeted and programmed funds. It must also target equitable allocations and expenditure of public health resources so that even the vulnerable and the poorest of the poor are not left behind.

The post Analysing the 2023 health budget proposal appeared first on Centre for Social Justice .

2023 federal budget estimates: dead on arrival

Center for Social Justice — Tue, 11 Oct 2022 10:33:22 +0000

The President, Major General Muhammadu Buhari (retd.), last Friday presented the 2023 Appropriation Bill and its details to the National Assembly. Budget presentation usually discloses the planned income and expenditure and accompanying fiscal, monetary and other policy frameworks for the new year. This discourse reviews the key components of the proposed 2023 federal budget and what it holds for the economic position of Nigeria. It seeks to answer the question: whether the estimates are realistic and achievable in the light of official economic data and previous macroeconomic performance.

The underlying macroeconomic projections are the oil price benchmark of $70 per barrel; daily oil production estimate of 1.69 million barrels (inclusive of condensates of 300,000 to 400,000 barrels per day); and exchange rate of N435.57 per US Dollar. The oil price benchmark and oil production (mbpd) are provided at a time Nigerian National Petroleum Company has become a limited liability company and is no longer under obligation to simply sell crude oil and remit the proceeds to the Federation Account for sharing by the three tiers of government. The implication is that it can only remit profits at the end of a year or at agreed intervals. It is acknowledged that the quantum and price of crude oil are very important considerations in the profitability of NNPC Limited. However, the most important consideration is that the profit is not necessarily tied to the price of crude. The company will pay for investments and other business outgoings before it can return a profit. Furthermore, not all profit will be distributed as dividends as the company will be entitled to retain some part of it for future investments.

The Naira has been depreciating due to low oil sales and revenue, capital flight, restrictive policies, etc. Nigeria’s multiple exchange rates demand action for harmonisation and convergence or at least, steps towards harmonisation. The Parallel Market hovers around N735; Investors and Exporters window is about N434 while the 2023 budget proposal is N435.57. This creates room for rent-seeking and arbitrage. The budget exchange rate projection is a flight of fancy and not grounded on reality.

The proposal is for a total expenditure of N20.5tn. To fund the expenditure is total available revenue of N9.73tn including the retained revenue of 63 Government Owned Enterprises estimated at N2.42tn. This creates a deficit of N10.78tn representing 4.78% of estimated GDP and this is above the 3% threshold set by the Fiscal Responsibility Act 2007. The deficit is to be met by new borrowings totalling N8.80tn, N206.18bn from Privatisation Proceeds and N1.77tn drawdown on bilateral/multilateral loans secured for specific development projects. In essence, the projected actual revenue is 47.5% of expenditure while the deficit funding is 52.5% of expenditure. What is the implication of this projection for our debt reality?

Nigeria’s outstanding debt at the end of June 2022 is reported by the Debt Management Office at N42.845tn ($103.312bn). This excludes the N20tn in Ways and Means financing from the Central Bank of Nigeria, which when added brings the total to N62.845tn ($151.538bn). When the new borrowing proposal is added to existing debts, it will come up to N71.64trn. Federal Government may need to borrow more than projected in 2023 because of two major reasons. The first is that the asset to be privatised has not been specifically identified and privatisation proceeds have been a funding item in previous budgets without any accruing revenue. The second is the perennial poor performance of revenue estimates. As at 31st July 2022, Federal Government’s retained revenue was N3.66tn, excluding the revenue of GOEs, a mere 63% of target. There is no guarantee that the revenue projection of N9.73tn will be met.

The expenditure proposal is made up of statutory transfers of N744.11bn; non-debt recurrent costs of N8.27tn including personnel costs of N4.99tn, pensions, gratuities and retirees’ benefits of N854.8bn; overheads of N1.11tn. Also, capital expenditure projection is N5.35tn, including the capital component of statutory transfers; debt service of N6.31tn; and sinking fund of N247.73bn to retire certain maturing bonds. Thus, at N6.55tn, debt/sinking funds is the highest expenditure head. If 2022’s actual revenue accrual is used as a benchmark (just N3.66tn retained revenue in July), the whole retained revenue may be dedicated to debt service in 2023. When the proposed new borrowing is juxtaposed with capital expenditure, it shows that Federal Government is not borrowing to fund capital expenditure but also to service debts and pay salaries. This is contrary to the provisions of the Fiscal Responsibility Act.

The framework of the 2023 budget proposal shows that Federal Government has given up on critical reforms it needs to make. The reform is on fuel subsidy. The first component is that Federal Government was expected to conduct an open and transparent public inquiry to determine the actual PMS consumption, on the basis of which a final subsidy decision will be made. There is prima facie evidence to indicate that the figures churned out by NNPC Limited are inflated. The second component is a phased withdrawal of fuel subsidy after certifying the actual fuel consumption. But Federal Government has shied away from this critical reform. Furthermore, Federal Government was expected to take targeted, concrete and deliberate steps to tackle oil theft. Again, it has thrown its hands in the air considering the less than 2mbpd oil production estimate.

Between 2020 to 2022, a total of N16.4tn was foregone as tax expenditure while Federal Government and the states continued to pile up debts. The proposal in the Medium Term Expenditure Framework 2023-205 to give away about N5.204tn in 2023 while Federal Government and the states incur humungous deficits is difficult to reconcile under fiscal responsibility rules. S.29 (1) of the FRA is titled restriction on the grant of tax relief. It states: “Any proposed tax expenditure shall be accompanied by an evaluation of its budgetary and financial implications in the year it becomes effective and in the three subsequent years, and shall only be approved by the Minister, if it does not adversely impair the revenue estimates in the annual budget or if it is accompanied by countervailing measures during the period mentioned in this subsection through revenue increasing measures such as tax rate raises and expansion of the tax base”.

There is no documentation showing evidence of compliance with the provisions of the FRA on these tax expenditures. There is no evidence of an evaluation of their budgetary and financial implications in the years they were granted and in the three subsequent years. These expenditures adversely impaired the revenue estimates and there were no countervailing measures through revenue increases, etc. It is therefore recommended that the FRA should be amended in the Finance Act 2022 to remove the power to grant tax expenditures from the Minister or the Executive and only place a duty on the Executive to document the recommendations, proposals and justification for tax expenditure subject to the approval of the legislature. Also, tax expenditures should be capped at not more than 10% of projected revenue every year or within the medium term.

It is not too late to adopt the above reforms and thereby drastically reduce the deficit and make the budget more realistic. Otherwise, the 2023 budget appears dead on arrival.

The post 2023 federal budget estimates: dead on arrival appeared first on Centre for Social Justice .

FOR NIGERIAN NATIONAL PETROLEUM COMPANY LIMITED TO BECOME ONE OF THE BEST IN CLASS

Center for Social Justice — Sun, 24 Jul 2022 12:23:36 +0000

July 21 2022

Press Release

Centre for Social Justice (CSJ) welcomes the inauguration of the Nigerian National Petroleum Company (NNPC) as a Limited Liability Company by President Muhammadu Buhari on July 19 2022. This is in line with the provisions of the Petroleum Industry Act especially its S.53. The immediate fiscal implication of this inauguration is that NNPC Limited will continue in the recent tradition of the old NNPC as there will be no monthly revenue remittance from crude oil to share by the Federal and State Governments. It is only at the end of the financial year, when NNPC Limited trades profitably, that dividends would be declared for sharing by the Federating Units.

It appears from the large share capital base and assets to be inherited by NNPC Limited that it has the requisite capital to start business from a position of strength and further financial resources can be raised from the capital market and commercial sources. However, financial resources must be matched with human and managerial resources in terms of the composition of the board of directors and the personnel to lead and work for the company to become one of the best in class comparable to very successful national oil companies.

From the empirical evidence of the background and curriculum vitae of the board of directors of NNPC Limited, CSJ is not convinced that Nigeria has assembled its “first eleven” in the composition of the board. The role of a governing board in piloting the affairs of a company established for profit cannot be overstated. Furthermore, the employees of NNPC who have now been retained by NNPC Limited were not employed on the basis of merit and competence. Rather, the majority were hired through nepotism and inordinate opportuning. The deliverables and results achieved by the old NNPC bear irrefutable testimony to this assertion. As such, these employees cannot be the core human resources expected to turn-around the new NNPC for profitability. The inauguration of NNPC Limited comes at a time Nigeria has not been producing enough crude oil to meet its quota from the Organisation of Petroleum Exporting Countries (OPEC). Other OPEC countries have in the past exceeded their quotas and indeed have spare production capacity to produce beyond the quotas. It is expected and hoped that the launch of NNPC Limited would not just be a change in nomenclature but a radical move to reposition the company to produce enough crude oil to meet and even exceed Nigeria’s OPEC quota as well deliver profits commensurate with the quantum of available natural resources and

financial investments of its shareholder which is the Federation of Nigeria comprising of the Federal and State Governments.

CSJ recalls that the Federal Government has spent much of the nation’s resources and over 35 per cent of our foreign exchange earnings importing refined petroleum products. The existing refineries have become dysfunctional and despite several billions of dollars invested in turn-around-maintenance and refurbishing, no concrete results have emerged. CSJ further recalls that the claim for subsidy has ballooned from 35 million litres a day in the year 2015 to the present 65 million litres. The Federal Government has approval from the National Assembly to spend not less than N4trillion on fuel subsidy in 2022.

On the basis of the foregoing, CSJ therefore recommends:

The immediate review of appointment of members of the board of directors of NNPC Limited to introduce world class Nigerian professionals with the requisite industry and corporate governance experience.

NNPC Limited to do a staff audit and assessment to ensure that dead woods are flushed out of the system to pave way for the recruitment of world class Nigerian experts with deep knowledge and wide experience in the sector.

If NNPC Limited is to make profit and declare dividends, schedule the moribund refineries immediately for privatisation or concession so as to take off loss making arms from the books of NNPC Limited.

FGN to ensure that it delivers value for money in all the refineries it has spent tax payers’ money in their purported turn-around-maintenance.

FGN to come clean and audit the actual fuel consumption in Nigeria so as to reduce the subsidy which is being paid from the proceeds of government borrowing.

Already, the FGN and States are facing severe fiscal constraints; FGN borrows to fund recurrent and capital expenditure as available resources are just enough to service debts. The profits expected from NNPC Limited at the end of the year will still be shared by the Federating Units and if the company is not properly managed, there will be nothing to share

NNPC LIMITED AS ONE OF THE BEST IN CLASS

The post FOR NIGERIAN NATIONAL PETROLEUM COMPANY LIMITED TO BECOME ONE OF THE BEST IN CLASS appeared first on Centre for Social Justice .