Home Opinion COVID-19 and Federal Government revised 2020 Budget proposal, By Isaac N. Obasi

COVID-19 and Federal Government revised 2020 Budget proposal, By Isaac N. Obasi


This piece is purely an advocacy against the proposal by the federal government to allow the use of N27bn to renovate the National Assembly complex as contained in its revised 2020 budget proposal presented to the National Assembly (NASS). We will recall vividly that when in December, 2019, the federal government presented its 2020 Budget estimates to the NASS, all hell was let loose when Nigerians learnt that the sum of N37bn was allocated for the renovation of the NASS complex. Many prominent individuals, public policy analysts, and civil society groups shouted on top of their voices against the use of such humongous amount of money to carry out renovation at a time when many Nigerians are hungry, many roads are in dilapidated condition, many old high quality schools and hospitals are shadows of their past, among many other deprivations in the country. 

Again, the NASS planned at the same time to buy foreign SUV cars for her members as against the proposal of making the purchases from a Nigerian car manufacturing company Innoson Motors. This writer then while appearing at the ARISE TV Morning Show joined many voices to speak vociferously against these two highly insensitive budget proposals. Unfortunately, it appears that those vociferous noises then achieved nothing judging from the news reports of yesterday Thursday, 4 June 2020.

Many newspapers and online news platforms on Thursday, 4 June 2020 carried the screaming news that COVID-19 has attacked all revenue sources of the federal government, a revelation which was made known by the Minister of Information and Culture, Alhaji Lai Mohammed. This earsplitting news is very understandable, unless a person is just hearing for the first time that coronavirus (COVID-19) is attacking (disrupting, and destroying if possible) almost everything under the sun. The Nigerian economy is not an exception. Yet our understanding of this situation sometimes cannot stand the test of certain hypocritical and unbelievable actions of the same government that wants us to believe that things are pretty hard due to the devastation of its revenue sources.

To put our discussion in a proper context, let us give the Information Minister Lai Mohammed further elaboration of his lamentation of the grave economic problems facing the federal government. According to him:

We are not just Nigerians, we are all witnessing what is going on in the world today. When the budget was passed in December last year, we all celebrated that the budget was passed for the first time in a good time to allow for us to plan. We were very hopeful that this year we will be able to achieve a lot…

I remember that the benchmark for crude oil was $57 but from nowhere today we have COVID-19, which has brought every economy in the world to its knees. Nigeria cannot be an exception. As a matter of fact, we are praying that the crude will go to $30 per barrel. All sources of revenue has been attacked by COVID-19, when we locked our borders how will goods come in? How will customs make money for the country? Abuja, Lagos and Ogun have been on lockdown for more than four weeks… How will they make money to pay taxes? So if we say there is no money it is not because we are seeking for lame excuses…

So please look at this in context, if you budgeted for $57 a barrel and we sold at $18 a barrel two weeks ago. This is why the minister of finance at the last council meeting, informed all of us that they will slash every ministry’s budget by 20 percent capital and 16 percent overhead. So where will the money come from? So when we complain there is no money, it is genuine.

If you know what is being spent on COVID-19 alone and what it is costing the whole world, you will be able to appreciate this better (See The Cable, June 3, 2020:   https://www.thecable.ng/fg-covid-19-has-attacked-all-our-revenue-sources); See also Daily Trust, June 4, 2020 https://www.dailytrust.com.ng/fg-covid-19-has-attacked-all-revenue-sources.html).

Our argument here utilises government’s own statements to expose its hypocrisy and inconsistency. First, government’s lack of seriousness in reducing wastages in governance exposes its outright hypocrisy. This is a government crying for lack of money, and the same government is ready to use N27bn for renovation. This is unimaginable and outrightly unbelievable. The government was not even smart at all. If for example there are places leaking in the complex, millions of naira can be utilised and this will be a quick win project during the budget year until the economy improves. Many Ministries, Departments and Agencies (MDAs), the minister confessed, have no money because the economy is in bad shape. So what makes the case of the NASS different? If the government does not know what to do with this money, it should wisely reallocate it towards improving educational and health infrastructural facilities across the country. This leads us to government’s high level of inconsistency when it comes to the education and health sectors.

Over the decades, the successive federal governments have consistently neglected the education sector. But the situation has further deteriorated since the Buhari administration came to power in 2015. Under the Jonathan administration for example, the education sector was allocated 12% of the budget in 2014, and before leaving office in 2015, the allocation was 11.79%. Thereafter, under the Buhari administration, the allocation to the education sector started moving down from 8% (2016), 7% (2017), 7% (2018,), 7.02% (2019) and 6.7% (2020). It is so unfortunate that it is this same poor allocation in the 2020 pre-COVID budget that the government has revised drastically downward without taking into consideration the heavy demands that COVID-19 is making on the infrastructural modification in line with the requirements of the physical distancing protocols. 

Again, allocation to the health sector is even worse. Before the Buhari administration, the health sector got 5.63% (2014) and 5.78% (2015). Subsequently, with this government, the sector got 4.13% (2016), 4,15% (2017), 4% (2018), and 4.1% (2019). Yet, way back in 2001, the African Union (AU) in its meeting in Abuja adopted the Abuja Declaration in which member countries pledged to allocate 15% of their annual budgets to the health sector. Nearly two decades after, Nigeria that hosted the meeting, has not been able to allocate more than 6% to the health sector. What a shame? Yet again, countries such as Rwanda, Burkina Faso, Botswana, Togo, Zambia, Malawi and even Niger our neighbor have been able to meet the 15% allocation to the health sector.

According to the Lai Mohammed, the minister of finance at the last council meeting informed them that they would slash every ministry’s budget by 20 percent capital and 16 percent overhead. If this was the decision, why were those of education (UBE) and health (Basic health care) cut as much as 54.25% and 42.5% respectively. According to the Punch report (with data from Dataphyte), some other sectors had only 10% proposed cut (see Punch, June 3, 2020). From all indications, the federal government of Nigeria is not serious about education and health as its hypocrisy towards the development of the two sectors, is becoming unbearable. Human capital development means practically nothing to this government as well as successive governments, as it is lip service all the way.

This new turn of budgetary cut in health, is against the promise made by Mr. Boss Mustapha, the Secretary to the Government of the Federation (SGF) and Chairman of the PTF on COVID-19, that the Nigerian health care system will never be the same in post-COVID-19 period. One may wonder whether this miserly allocation is what would transform the health sector to that state of his dream.

In conclusion, the reactionary ideology of successive federal governments is progressively retrogressing and under-developing Nigeria with the passage of time, as demonstrated by the insensitivity of politicians particularly those in the NASS. This is doing no one any good in this country themselves inclusive. But if the instructive lessons of COVID-19 pandemic are not enough to compel them to change for the betterment of Nigeria, then like Karl Marx said, the capitalists (read politicians) themselves would be the ones digging their own grave. The cruel nature of globalisation of this age, as seen in this COVID-19 pandemic, exploitation and grave injustice in many countries, unnecessary conflict fueled by bad politics of provincialism and domination, wars, among others, may create the objective conditions that Karl Marx predicted.     

•Prof. Obasi, a public policy expert (& former columnist in the Daily Trust, Abuja, March 2003 to October 2006, & Daily Champion, Lagos, April 2005 to December 2008), is of the Department of Public Administration, University of Abuja. Email: [email protected]      

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