President Bola Tinubu

Reactions have continued to trail Nigeria’s controversial N2.8trillion 2023 supplementary budget recently passed by the Senate, the country’s upper legislative chamber, which most economic analysts have described as controversial and largely unnecessary. This is especially given that the supplementary budget is coming less than two months to December 31, which marks the end of the 2023 budget cycle.

Reports however say the hurried passage of the budget by the Senate without any scrutiny is even more worrisome given that more than 70 per cent of the items in the said supplementary budget have already been captured in the 2024 national appropriation, which is expected to come on stream January 1, 2024, all things being equal.  

The President Bola Tinubu-led federal government had while unveiling the budget at a recent federal executive council meeting, hinted that the budget would be channelled towards funding national defence and security as well as the provision of welfare packages for the citizen, given the worsening economic condition.

A breakdown of the budget shows that a total of N605 billion was earmarked for national defence and security; while N300 billion was set aside for the construction, rehabilitation and maintenance of roads across the country as well repair of bridges. According to the budget estimates, government’s pledge to pay N35, 000 to every of about 1.5 million workers being employed by the federal government for the months of October, November and December 2023, which would gulp N210 billion.

Other details show that N7 billion was earmarked for the renovation of the President’s and vice President’s official residences in Lagos and another whopping N1.5 billion for the purchase of vehicles for the first lady.

Also in the budget is the whopping N28 billion earmarked for the State House, out of which a total of N5.8billion has been set aside to acquire Sports Utility Vehicles SUVs and replacement of operational pool vehicles. Similarly, the sum of N2.5 billion was approved for the renovation of Aguda House while computerisation and digitalisation of the State House was allocated N200 million.

Economic observers have however questioned the N3billion comprising N1.5 billion each for acquisition, renovation and rehabilitation of two Economic and Financial Commission’s EFCC- forfeited quarters as State House Complex annex at Mabushi and Guzape areas.

These observers have wondered that if these houses were actually forfeited, from who is the country acquiring them? They insist that there is no justification for many of the expenditures outlined in the budget considering the current economic situation in the country and the worsening huge debt overhang.

The situation is even more worrisome, given that the government is planning to take more loans. For instance, according to the new Medium Term Expenditure Framework MTEF and the Fiscal Strategy Paper FSP, the government has projected to borrow N26.42 trillion between 2024 and 2026 with debt servicing projected to gulp N29.92trillion within the three years.

Available data further show that the government is planning to borrow N7.81trillion for 2024, which comprise N6.04trillion and N1.77trillion from local and foreign sources respectively. By 2025, the Federal Government plans to borrow N8.54trillion.

Analysts have continued to wonder what morality of a government that has repeatedly asked the citizens to tighten their belts, to make sacrifices in the belief that things will improve has in embarking on such wasteful spending, especially on luxuries. This is an indication that the decision to remove the subsidy on petroleum products was actually to have more money to fund their lavish lifestyle.

This is against the backdrop of the fact that over 130 million citizens, out of the 200 million population, according to government’s statistics live under multi-dimensional poverty. These figures may have changed since May 29, 2023, when the current government came into power and announced immediate removal of subsidy on petroleum products. This development led to an increase in the pump price of Premium Motor Spirit PMS from N157 per litre to N560 per litre, which currently stands at N603 per litre in Lagos and even higher in some states. This further exacerbated the already high cost of living and had since thrown many more citizens into the extreme poverty bracket.