The President of the Chartered Institute of Bankers of Nigeria, (CIBN), Prof. Segun Ajibola, has described the provision of N2.8 trillion as capital expenditure in the 2018 budget as grossly inadequate given the massive infrastructure gap in the country.
Ajibola was quoted as saying that the sum will not help in achieving the development objectives targeted by government through the budget during a chat with the News Agency of Nigeria (NAN) in Abuja.
The seasoned banker said: “Looking at the provision for the capital expenditure, one will say it is low because there are lots to be done in economy today in terms of capital projects. In terms of infrastructure, we have power projects, railway, refineries, manufacturing and agriculture projects.
“These are capital related projects that require substantial allocation from the budget. When one looks at the state of economy today, one will say the provision of capital expenditure is low,’’ he added.
On what measures should be adopted to ensure that the budget achieves its targets, the CIBN boss advocated prompt release of funds to implement the capital projects.
“We are in May now; we don’t want to hear that funds are not released for capital projects in October. If that is the case, that means nothing can be achieved in the implementation of the 2018 budget,’’ he said.
While commenting on the National Assembly’s increase of the budgetary provisions by N508 billion, the academic pointed out by law the Legislature had the statutory power to tinker with the figures submitted by the Executive, adding however, that such adjustments must be explainable, accountable and beneficial to the economy.
Ajibola noted that the explanation given by the Legislature on why the earlier provisions in the Appropriation Bill were changed suggested the adjustments in the 2018 budget would promote growth and development.
He clarified: “It is not the adjustment that will increase recurrent expenditure and compound the already high debt burden. They are projects-hiked adjustment; they are adjustment that can be measured.
“Also, I want you to know that the implementation of budget is done by the executive not the legislature, so the President will still do some consultations before signing the Budget”, Ajibola added.
This is even as he assured that the country’s rising debt profile of N21.7 trillion should not elicit any worries since the debt was being spent on projects so that the dividend of borrowing would come handy to an average Nigerian.
The chartered banker assured: “We also know that some of the debts are transmitted from local to foreign through Euro bond to reduce the debt burden. It is also a good development when you look at the budget and debt services; we can say that the debt is channeled toward development.’’
It would be recalled that Appropriation Bill, which was passed yesterday was jacked up by the Legislature by N508 billion, rising from the N8.61 trillion proposed by President Muhammadu Buhari in November, 2017, when the Bill was laid before a joint session of the National Assembly to N9.12 trillion.
Of its current aggregate expenditure, N530 billion was earmarked for Statutory Transfers while N2 trillion was earmarked for Debt Service. Also N3.5 trillion was earmarked for Recurrent Expenditure.
The budget’s deficit to Gross Domestic Product (GDP) currently stands at -1.73 per cent.