As the economic hardship in Nigeria bites harder, oil price remains low and the naira is still in a free fall against the dollar, cutting down recurrent expenditure has been widely prescribed as the way to go, especially for any government that intends to deliver good governance during economic downturn.
In a country that runs a widely-criticised bloated government, which has been arguably rated as one of the most expensive in the world, not a few economists have advised that the expenditure of public officials at all levels should be cut drastically. Doing this, they argue, is the only way to save funds for the provision of capital projects for the benefit of the public.
But members of the National Assembly are said to be unhappy with the cuts in the allocations to their operations and that of the judiciary in the N6.08tn 2016 Appropriation Bill recently submitted to the legislature.
The National Assembly had depended on an annual budget of N150bn from 2010 to 2014, which Nigerians had consistently criticised as too big for the legislature. The figure dropped to N120bn in 2015. Furthermore, another N5bn has been sliced off the annual allocation in the 2016 budget proposal, leaving the legislature and its bureaucracy with N115bn.
Members of the House of Representatives, in particular, are expressing reservations that the cuts will weaken the Federal Government’s anti-corruption war, if the key institutions that will strengthen the war are starved of funds.
A representative was quoted as saying, “Then, people forget that National Assembly is not just about the 360 Reps and 109 senators. There is the bureaucracy of the National Assembly: the National Assembly Service Commission, the National Institute of Legislative Studies and the National Assembly Budget and Research Office; all will draw from the same figure.”
While the lawmakers are said to have admitted that cuts in budget were necessary in view of the challenging economic situation of the country, they argue that such cuts should be more for the executive more than the legislature (the National Assembly) and the judiciary.
A federal lawmaker had reportedly said, “The implication is that these other arms are being weakened by the executive, while the budget of the executive keeps increasing. This year (2015), the executive alone spent N4tn; next year, they will spend about N6tn because when you look at the entire budget, National Assembly’s share is about two per cent.”
There are strong indications that the National Assembly may jack up its budget before passing the 2016 Appropriation Bill, although the Chairman, House Committee on Media and Public Affairs, Mr. Abdulrazak Namdas, said it would be hasty to say so, until when the Assembly resumes plenary this January and go through the details and breakdown of the proposal.
“But, one thing is certain, no budget ever returns to the executive the way it came to the National Assembly. There must be dotting and crossing of allocations,” Namdas noted.
Like their House of Representatives counterparts, senators are also said to be unhappy with the National Assembly’s budget cuts.
According to some of them who spoke toTHE NEWS GRID a few days after the President presented the bill, cutting N5bn from the N120bn budget of the federal parliament will affect the running of the critical arm of government.
A member of the Senate Committee on Appropriation from the South-South geopolitical zone, had told THE NEWS GRID that the federal parliament would reject the proposal.
The Chairman, Senate Committee on Banking, Insurance and other Financial Institutions, Senator Rafiu Ibrahim, described the document submitted to the National Assembly by the President as a mere proposal.
Ibrahim, who is also a member of the Senate Committee on Appropriation, said, “It is still a proposal and if we discovered, after a careful examination of the breakdown, that it would affect some critical aspects of legislation, especially our oversight functions, which is very critical to democracy, we might take a second look at it.”
On the same page with Ibrahim is the Senate Leader, Senator Ali Ndume, who disabused the minds of Nigerians from an impression that the N120bn approved in 2015 for the National Assembly was shared among the 469 lawmakers in the federal legislature.
He said, “Truly, the N120bn is for the National Assembly but the breakdown showed that the Senate was given N31bn in 2015, compared to the N39bn it got in 2014. For the House of Representatives, it was N69bn in 2014 but reduced to N49bn in 2015.
“The entire budget is for the whole National Assembly, which comprises 109 Senators, 360 members of the House of Representatives, 13 Commissioners in the National Assembly Service Commission; the management arm of the National Assembly, which has a staff strength of 3208 who are paid salaries, allowances and other emoluments.”
As members of the National Assembly justified how the legislature spends its budget, close watchers of the lawmakers and their expenditure have asked why the Senate is spending at least N4.7bn on new luxury cars, while the House would also buy exotic cars for its members with about N4bn out of the budget.
According to observers, the 2016 budget is not the only issue on which President Buhari and the National Assembly may clash; the plan by the lawmakers to spend a sizeable amount of public funds on luxury cars is also brewing a confrontation.
Members of both chambers of the National Assembly had faulted Buhari’s opposition to their plan to purchase cars for 109 senators and 360 members of the House of Representatives, despite that the lawmakers had collected between N7m and N8m each (a total of about N400m) as car loans in August 2015.
The lawmakers had said the 469 cars they planned to buy would be used for oversight functions by members of the National Assembly, but the President had, in his maiden Presidential Media Chat on December 30, 2015, expressed reservation over the N47.5bn reportedly proposed to be spent on the cars.
Urging Nigerians to take the issue to court, Buhari said if he could reject N400m bill for his personal cars as a President, the lawmakers should do the same thing. The President also said he would hold a closed-door meeting with the National Assembly members because of the plan.
Buhari said, “N47.5bn for vehicles for the National Assembly members? I think I will explore the possibility of that power. If I can turn down N400m for vehicles in the Presidency, I think we don’t need new cars; we can manage the old ones because of the economy.”
It was not clear whether the President meant N4.7bn when he made reference to N47bn on Wednesday night.
Some senators, who reacted to the President’s opposition to the purchase of new cars, faulted Buhari’s argument and insisted that there was no going back on the acquisition. According to the lawmakers, the loans they collected were already being deducted from their monthly salaries.
However, President of the Senate, Senator Bukola Saraki, had denied that senators planned to buy cars in the region quoted by the President.
The Senate President, in a tweet on his Twitter handle, @bukolasaraki, said, “Not in my time will @NGRSenate spend N50bn or N47bn or N4.7bn on cars for Senators. Not in my time will Senate spend N47bn on cars. (The) details of (the) #2016Budget will be made available and open for public debate and scrutiny.”
The Senate had already decided on Toyota Land Cruisers for its 109 members and might spend about N4.7bn on the vehicles, while the House of Representatives has yet to decide on the choice of luxury cars to buy.
The 360 members of the House are reportedly divided on whether to buy Peugeot 508 salon cars or the 2015 model of Toyota Camry. Depending on the choice of the legislators, the House might spend between N3.4bn and N4.2bn, respectively, on the cars this year.
Additional units would be procured for the services of the Speaker, Mr. Yakubu Dogara; the Deputy Speaker, Mr. Yusuf Lasun; House Leader, Mr. Femi Gbajabiamila; Minority Leader, Leo Ogor, and other principal officers of the House, besides the 360 for the generality of the Reps.
Over the years, the practice has been for departing lawmakers to hold on to the cars when their tenures end, while the management of the National Assembly evaluated the vehicles and deducted an agreed amount from their severance package.
The 6th House (2007-2011), under the leadership of Speaker Dimeji Bankole, bought Peugeot 407 for members as committee cars. All the cars were taken away by the departing legislators.
During the 7th House (2011- June, 2015) when Mr. Aminu Tambuwal was the Speaker, the choice car was Toyota Camry.
At the close of the tenure on June 5, 2015, all the cars were taken away after the bureaucracy of the National Assembly valued them and asked the outgoing members to part with a fraction of the original value of the vehicles from their severance package.
It would be recalled that the Presidency had, few days after Buhari and Osinbajo assumed office, announced that both the President and the Vice President had accepted 50 per cent pay-cut as a way of setting example in the wake of the dwindling economy.
Ironically, observers have pointed out that the executive, which wants to put the legislature to order on its expenditure, had proposed a recurrent expenditure widely considered to be higher when compared to the last administration’s.
For instance, President Buhari and Vice-President Yemi Osinbajo are to spend N2.2bn on travels and transport, foodstuffs and catering materials, refreshment and meals, as well as honorarium and sitting allowances in the 2016 fiscal year.
The total allocation of N2.2bn to the President and the Vice President is N710m higher than what was budgeted for the same purposes under former President Goodluck Jonathan.
In the budget proposal, N1.415bn was allocated to the President alone for general travels and transport. This amount, when compared to the N944.62m that Jonathan got in 2015, was N470.38m or 49.7 per cent higher.
For foodstuffs and catering materials, a total sum of N114.9m was allocated for Buhari alone, indicating an increase of N45.09m or 64.6 per cent over that of Jonathan.
In terms of honorarium and sitting allowances, N307.64m was budgeted for the President as against N223.24m allocated for the same purpose in 2015. Another N49.1m has been proposed for the President in the 2016 fiscal period for publicity and advertisement as against N29.8m in 2015.
For the Office of the Vice President, the budget document states that N48m was proposed for general travels and transport in 2016 as opposed to N33.86m in 2015.
Other amounts allocated for the Vice President are foodstuffs and catering, N16.6m; refreshment and meals, N7.5m; honorarium and sitting allowance, N8.8m; and publicity and advertisement, N23.08m. These amounts allocated for Osinbajo, when compared to the amount budgeted for former Vice President Namadi Sambo for the same purposes in the 2015 budget, represent an increase of N4.84m, N2.18m, N1.88m and N6.79m, respectively.
The document also listed other expenditure items for the Office of the Vice President to include maintenance service, N46.44; consultancy, N9.6m; other services, N22.3m; fuel and lubricants, N24.9m, among others.
It would be recalled that the Minister of Finance, Mrs. Kemi Adeosun, shortly after assumption of office in November, had inaugurated the Efficiency Unit to assist the government cut the cost of governance.
The minister, who said the unit was approved by Buhari to drive down the cost of running government, said no amount of economic policies would deliver the desired results, if the manner in which government money was expended was not carefully controlled.
Among other reasons for the initiative, Adeosun said, “In the few weeks I have spent as the Minister of Finance, it has become clear that without a radical intervention to manage the costs of government, no meaningful improvement in our nation will be forthcoming. No amount of fiscal innovation, financial re-engineering or other well-intentioned economic policies will deliver the desired results, for as long as the manner in which government money is expended is not carefully controlled.”
Assessing the issue, a political economist, Professor Pat Utomi, said he had complained about the high cost of governance very loudly. “We cannot have a drop in income and people (government officials) are buying cars,” he stated.
The former presidential candidate recalled that between 1975 and 1976 when the same “cycle of volatility” came and oil prices dropped, General Olusegun Obasanjo (as the Head of State) introduced a policy referred to as “low profile.”
Utomi said, “The Head of State’s official car came down to Peugeot 504; that was what Obasanjo was riding. That made a lot of sense. It saved cost, which we needed to save at the time.
“If you have a family and you lose your job, will you not do something drastic to trim down your expenses; to live on your savings until you get a new job? That is a critical thing to do. But for the parents – the so-called leaders – to be buying new cars, it means that for them, the whole thing is not about building any country; it is about ‘what am I getting from this opportunity? I spent money to win election.
“As far as many Nigerians are concerned, being in position of authority is not an opportunity to build the nation; it is an opportunity to get reward for having spent money on political campaigns. It is harder for them (elected public officials) to sacrifice, just like a father who has lost his job to cut down expenses so that he can manage his savings until he can get a new job. Rather, they have a hunter’s mentality – to shoot down the big game first and cut their share.”
According to him, the Nigerian political elite have yet to develop the discipline and the vision to create a great nation.
In his submission, a lecturer in the Department of Economics of the Ahmadu Bello University, Professor Usman Muttaka, urged the Presidency to look at the budget critically and scrutinise it very well.
Muttaka added, “On the National Assembly, because there is separation of powers, the legislature is at the frontline of the administration; it should be guided on what and what to purchase.
“In the real sense of it, one can say the expenditure is too much. But notwithstanding, in my analysis and forecast, yes the price of crude oil is falling down but it is likely to rise by the middle of the year. Nevertheless, there is the need for a prudent way of spending those (public) monies and we need to prioritise sectors that will bring back something to the economy, not to waste it (funds).
“When you just spend your money on entertainment and cars, it means you are providing jobs for other countries, not Nigeria, because those things are not produced here. I think there must be a critical look at the figures to know what is important and what to prioritise.”
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