Overspending: Nigeria Is Off Budget For 2012

Just 3 months left for the expiration of 2012, and another budget proposal due in less than two weeks, Nigeria is falling short in meeting the financial targets of the year as encapsulated in the budget.

The Minister of Finance, Dr Ngozi Okonjo-Iweala, told reporters in Abuja that of the N710.4 billion so far released to Ministries, Department and Agencies (MDAs), N553.2 billion was cash-backed. She said the total amount so far utilised by the MDAs was N320.9 billion out of a capital budget of N1.3 trillion for 2012.

The minister also added that the Federal Government had only disbursed N30 billion for projects under the N180 billion earmarked as its share of the Subsidy Reinvestment and Empowerment Programme (SURE-P).
SURE-P was initiated early in 2012 following the partial removal of subsidy on petroleum products.
The Federal Government’s share of the money is being reinvested in healthcare, public transportation, vocational training and key infrastructure projects.

NAN reported that the Federal Government receives N15 billion from the Federation Accounts Allocation Committee (FAAC) for the SURE-P.
Okonjo-Iweala also spoke on the $1 billion Sovereign Wealth Fund (SWF), which she said was no longer in contention since it has received the support of the 36 state governors.

Okonjo-Iweala made the clarification to reporters in Abuja on Friday following the Nigeria Governors Forum’s (NGF) decision to return to court over deductions from the Excess Crude Account for subsidy payments.

“I am aware that they are heading to court about the deductions from the Federation account related to the subsidy payments; that is what I heard, that they are going to Court for that.
“As for the Sovereign Wealth Fund, it has been launched with their full agreement with the 1 billion dollars take off grant, and the Board that is to manage the fund was announced recently.
“I have not heard of anyone saying that they want the SWF abolished and it is very important to emphasise that, because the more we talk about challenges to the SWF, the more we may undermine international confidence on something that has been agreed on by everybody.’’

Last month, the Minister named 36-year-old Nigerian, Mr Uche Orji, a former Managing Director of JP Morgan, as the CEO of the Nigeria Sovereign Investment Authority (NSIA) to manage the fund.
Orji is scheduled to assume duty on October 2, two days before President Goodluck Jonathan presents the 2013 budget speech to the National Assembly.

The Minister told reporters that on-going discussions with the National Assembly on the budget were “very fruitful and constructive.’’
She said the administration had kept faith with its promise to deliver next year’s budget to the legislative house before the end of September.
“Mr President wants to give the National Assembly adequate time to study the budget, and so, he tasked us to have the draft budget ready for him to see in good time’’.

Okonja-Iweala stressed that the support of the legislature was crucial if the executive arm of government was to achieve its target of ending the budget circle in December.
“This were some of the issues we discussed with the chairmen of the National Assembly committees, and I think they are reflecting on this and we hope to work together.
“Of course, we need to push very hard on the continued implementation of 2012 budget and we mean to do that.

“The message we have from Mr President is that we must be unrelenting in the implementation of 2012 budget and unrelenting in all projects and programmes, so we have to work hard.