13 things NGO’s need to know about the 2016 budget from the President’s Speech
By Oyebisi Babatunde Oluseyi, Executive Director, Nigeria Network of NGOs.
Just some few weeks of sleep or sleepless nights until the 2016 budget is passed, however from the President’s speech we have gotten a firmer picture of what the Federal Government has planned for the next 12 months in 2016.
While we are working on accessing the budget itself with the hope of publishing a more analytical piece, here are 13 things Non Government Organisations (NGOs) in Nigeria need to know about the 2016 budget from the President’s speech.
1. In what is becoming a cliché, the President stated that “our problems are not beyond us’’ and spoke about how the solution lies in, ‘our farmlands, our corporations, in the universities, in the hearts and minds of our entrepreneurs; through the gallantry of our Armed Forces; and the resolute spirit of Nigerians’, indicating that the Federal Government (FG) is giving priority to agriculture, education, entrepreneurship (job creation) and security.
Nigerian NGOs and coalitions working in the areas of agriculture, education, entrepreneurship and security will need to up their game in providing the government with needed intelligence, evidence based data and model projects and programmes that the government can scale up in these sectors of the economy.
2. The Federal Government is ready to tackle corruption head on and is not relenting in its efforts to rid Nigeria of corruption. NGOs working on good governance should expect ‘many more initiatives’ coming from the FG in fighting corruption. It is imperative that NGOs working on good governance support government’s efforts in the review of any new anti-corruption initiative and also engage with anti-corruption agencies on how best citizens and citizen organisations can support government’s anti-corruption plans.
3. The Federal Government has adopted a zero budgeting system. Wikipedia explains zero budgeting thus: Zero-based budgeting is an approach to planning and decision-making that reverses the working process of traditional budgeting. In traditional incremental budgeting, departmental managers justify only variances versus past years based on the assumption that the “baseline” is automatically approved. By contrast, in zero-based budgeting, every line item of the budget, rather than only the changes, must be approved. Zero-based budgeting requires that the budget request be re-evaluated thoroughly, starting from the zero-base; this involves preparation of a fresh budget every year without reference to the past. This process is independent of whether the total budget or specific line items are increasing or decreasing.
NGOs working on budget monitoring will need to build new capacity if needed in understanding how the zero based budgeting process works and what this means for their work and how it helps in balancing FG budgets. NGOs working on public procurement will also have to step in, since this system might open up new challenges in the areas of contract inflation and over pricing.
4. Cooperative societies will be the platform through which the FG aims to support (through loans) and train market women, traders and artisans in partnership with State and Local Governments. Cooperative based NGOs especially have an important role to play in monitoring and shaping how these loans and training’s are delivered.
5. Social protection is an integral part of the 2016 budget and will be implemented in phases. A full social protection programme will be launched soon and will include, ‘conditional grant transfers to the poor and vulnerable, home-grown public primary school feeding and free education for science, technology and education students in our tertiary institutions.’
This is an important area of work for NGOs working on social protection, poverty reduction, child nutrition, education and health including organisations working on anti-corruption, public procurement to monitor implementation of the social protection programme.
6. “Compilation of registers of the poorest persons is ongoing’’ indicates the President in his speech. All NGOs must ask questions here when did this start? How is it being implemented? What data is being used? What is the definition of the poor and vulnerable? Which agency of the government is handling the registration? These and many more questions need to be asked with a view to strengthen the system and ensure that the poorest and vulnerable in our society are truly the ones registered.
7. The 2016 budget proposal is ‘N6.08 trillion with a revenue projection of N3.86 trillion resulting in a deficit of N2.22 trillion’. ‘Deficit will be financed by a combination of domestic borrowing of N984 billion, and foreign borrowing of N900 billion totalling N1.84 trillion.’
The expertise of NGOs working on the economy is needed here to inform the National Assembly and Government on the implications of this for our future and our debt profile as a country.
8. Domestic resource mobilisation for the budget will come from ‘oil related revenues’, which is expected to contribute N820 billion. Non-oil revenues, comprising Company Income Tax (CIT), Value Added Tax (VAT), Customs and Excise duties, and Federation Account levies, will contribute N1.45 trillion. Finally, by enforcing strict compliance with the Fiscal Responsibility Act, 2007 and public expenditure reforms in all MDAs, we have projected up to N1.51 trillion from independent revenues.
Tax justice NGOs, NGOs working on extractive industries, procurement NGOs all have their work carved out in 2016.
9. In his speech the President hinted on the possibilities of a subsidy removal in the future. “I have directed the Petroleum Products Pricing Regulatory Agency (PPPRA) to adjust its pricing template to reflect competitive and market driven components. We believe this can lower input costs and attain efficiency savings that will enable PPPRA to keep the selling price for all marketers of petrol at N87 per litre for now.’’
The ‘now’ (with emphasis on it by the President in his speech) suggests a possible change in the oil pricing structure which may necessitate the removal of fuel subsidy at some point within the life of this administration. Civil Society Organisations must work together in feeling the pulse of citizens on subsidy removal and not leave organised labour and opposition parties alone to lead the process. We must find evidence based data for our stand on either the removal or non-removal of subsidy; this must not be based on sentiments but on real economic analysis and representation of citizens’ opinion.
10. The cause of the fuel scarcity we have been experiencing in the last couple of months according to the President is caused by ‘market speculators and resistance to change by some stakeholders.’
It is imperative for Nigerian NGOs as representatives of the issues affecting the common man to evolve an advocacy and campaign programme that can mobilize citizens’ action in addressing issues of excessive market speculation and strengthen reform in the oil and gas sector.
11. Capital expenditure for the budget is N1.8 trillion as against N557 billion in the 2015 budget. The very first time capital expenditure will be 30% of the total budget – Works, Power and Housing – N433.4 billion; Transport – N202.0 billion; Special Intervention Programs – N200.0 billion; Defence – N134.6 billion; and Interior – N53.1 billion.
The increase in capital expenditure by the FG demonstrates its understanding of the need to build critical infrastructure that can support the growth of other key sectors of the economy. NGOs must mobilize citizens and citizen organisations to ‘follow the money’ and monitor implementation of government projects.
12. In his speech the President called for support in the implementation of the 2016 budget. Though NGOs are specifically not mentioned in the President’s speech neither was the civil society, we have other institutions within the civil society family mentioned; ‘organized labour, industry groups, the press and of course, our religious and traditional institutions.’
There is the need for NGOs to be recognised as important actors and contributors to national development by governments at all levels, as NGOs are working hard to support government in several sectors of the economy.
In moving rhetoric to action on the need to support government, The President and his team will need an office to coordinate civil society’s support in the implementation of the 2016 budget that is why the Office of the Special Adviser to the President on Civil Society is important including an Office for Partnerships.
13. Missing from the President’s speech is the mention of the Sustainable Development Goals (SDGs), whose implementation starts in 2016 though sustainable development was mentioned twice in his speech there is evidently a lot of work for SDGs campaigners in analysing the 2016 budget and to ascertain how best it can jump-start the attainment of the SDGs in Nigeria.