Budget 2017 On Our Mind

By Saatah Nubari

The first time this budget analysis series ran was for the 2016 budget; and it becomes visible each day that the 1810-page document was a horrid, hurriedly-put, corrupt-conduit-filled piece of executive cluelessness. Well, since I’m more of a realist than any of the other-ists, I’ll just say that the fact that the world lost an entire tree to the making of the paper it was inked on is a tragedy. We have been given a sequel.

 

*Buhari presenting the 2017 Budget 

The 2017 budget was presented to the National Assembly by the President in the presence of the ministers who drafted it – and even slept while the presentation was on – and it was called the “Budget of Recovery and Growth.” If you noticed, it is quite a change from the previous budget of change just like the government’s change mantra. Here are some quotes from the President’s speech on what when passed, will be arguably the most important document in the country – sorry, just checked and it is 63 paragraphs long so I will just skip to analysing the 2017 budget as we await the implementation report of the 2016 budget.

The 2017 budget is N7.298 trillion. According to the government, this comprises
i. Statutory transfers of N419.02 billion;
ii. Debt service of N1.66 trillion;
iii. Sinking fund of N177.46 billion to retire certain maturing bonds;
iv. Non-debt recurrent expenditure of N2.98 trillion; and
v. Capital expenditure of N2.24 trillion (including capital in Statutory Transfers).

We will begin with the State House budget, which is, N42,917,666,214. This almost doubles what the previous government budgeted for this in 2015 which was N23,465,865,117. Out of this, N19,970,000,000 is the total capital budget while the total recurrent budget stands at N22,947,666,214. The total overhead is 10,171,082,268 and that for total personnel is N12,776,583,946.

This is the first piece in the #SaatahBudgetSeries2017, and I will be looking at the budget of the State House (which was referred to as Presidency in previous budgets).

STATE HOUSE
There are 16 agencies under the State House, and they are: State House Headquarters, The Office of the President, The Office of the Vice President, Office of the Chief of Staff to the President, Office of the Chief Security Officer to the President, State House Medical Centre, State House Lagos Liaison Office, Office of the Senior Special Assistant to the President on Sustainable Development Goals(SDGS), National Institute for Policy and Strategic Studies(NIPSS). Kuru, Bureau of Public Enterprises, National Emergency Management Agency, Economic and Financial Crimes Commission, Bureau of Public Procurement, Nigeria Extractive Industries Transparency Initiative, Nigeria Atomic Energy Commission and its centres, and Office of the Chief Economic Adviser to the President which funny enough the President only appointed in August of this year.

The first piece of shit I was hit with, ironically, was the “Sewage Charges” budget of the State House Headquarters. It was put at N52,827,800. That means N144,733 every day. That’s a lot of shit as far as the eye can see. Compare this with the “Sewage Charge” budget for 2015 which was N4,957,143 and for 2016 which was N6,121,643. This simply means the shit charge went up by 1050% comparedwith the 2015 budget, and 850% when compared with the 2016 budget. The N52,827,800 question I want to ask now is what exactly are they shitting there?

The State House Headquarters budget for “Honorarium/Sitting Allowance” is N556,592,736. Let me remind you that the previous government budgeted N174,471,371 for same item in 2015, while in 2016, this administration jacked it up to N507,518, 861. 

As Impunity Reigns At PenCom

By Ikechukwu Amaechi

The Pension Reform Act (PRA), which established the National Pension Commission (PenCom), was enacted by the National Assembly (NASS) in 2004 to create a body that would regulate, supervise and ensure the effective administration of pension matters. Before then, pension schemes in the country were bedeviled by many problems, including the fact that the public service operated an unfunded Defined Benefits Scheme. Though the payment of retirement benefits was budgeted annually, most times there were no funds to execute the scheme.

The situation was even worse in the private sector where many employees were not covered by the pension schemes put in place by their employers, and even where they were covered, many of the schemes were not funded.

So, the PRA was hailed as pragmatic, just like PenCom, the regulatory body that would formulate, direct and oversee the overall policy on pension matters by establishing standards, rules and regulations for the management of pension funds.

But what the PRA did not envisage in setting up PenCom was the establishment of a regulatory agency that would see itself as being above the law or which would go out of its way to undermine the same organisations it was set up to nurse to good health.
Unfortunately, that seems to be the situation now.

PenCom has become a law unto itself. Its management is contemptuous of court judgments and treats well-meaning advice from constituted authorities with levity.

In PenCom, bias against certain business interests trumps equity and justice. That is a dangerous value proposition for a regulator in such a critical industry.

The story of the regulator-engineered crisis that has engulfed an otherwise frontline Pension Fund Administrator (PFA) is pathetic. It is a classic illustration of the ‘might is right’ philosophy of those who think they control the levers of power in Nigeria.

The contrived crisis which has hobbled First Guarantee Pensions Limited (FGPL) for over five years is orchestrated by PenCom headed by Chinelo Anohu-Amazu.

I commented on this matter a few weeks ago, hoping that somehow the shenanigans will stop.
But the impunity continues and I am appalled and horrorstruck by the propensity of a government agency to flagrantly disobey court orders.

To recap, FGPL is a Nigerian company incorporated in 2004 and licensed as a PFA in 2006, with a total 37 shareholders.
Despite the teething problems, the management turned around the fortunes of the company in 2010 and subsequently paid dividends, a feat PenCom acknowledged.