Budget Group Says Massive Fraud Headlines 2022 Capital Budget, Seeks Urgent Amendment of Fiscal Responsibility Act

Akanimo Sampson

Akanimo Sampson

The foremost civic-tech organisation that is leading the advocacy for fiscal transparency and accountability in Nigeria, BudgIT, has raised a serious concern about ongoing huge revenue losses in Nigeria.

To therefore arrest the worrisome drain, it is calling for an urgent amendment of the Fiscal Responsibility Act (FRA) 2007, before the National Assembly.

The group wants the amendment to be given a speeding hearing and corresponding presidential assent in a bid to empower the Fiscal Responsibility Commission to enforce fiscal discipline in the country.

According to BudgIT, Nigeria currently loses trillions of naira in revenues due to MDAs breaching provisions of the FRA 2007.

It is equally calling on the federal legislators to eliminate infractions and corruption loopholes in the 2022 Approved budget. BudgIT was speaking after it published its 2022 Federal Government Budget Analysis Consultative Memo titled Leveraging Budget Reforms for Economic Development.

BudgIT’s preliminary analysis of the 21,108 capital projects in the 2022 approved budget, has uncovered 460 duplicated projects amounting to N378.9billion.

A further analysis by the research team has revealed other critical causes for concern – infractions and corruption loopholes that need to be urgently reviewed by the National Assembly in its current budget review process.

In its analysis, BudgIT noticed that some projects linked to MDAs that do not have the mandate to execute them are directly connected to the leadership of the Legislative arm of government.

In a statement by the group’s Acting Head of Media and Communications, Iyanu Fatoba, BudgIT cited the cumulative allocation of N1.45billion to the Nigerian Stored Products Research Institution and Nigerian Centre for Agricultural Mechanisation in Ilorin, Kwara State, to construct the “Femi Gbajabiamila Public Junior Secondary School, Itire Ikate.”

It observed that both agencies in Kwara have no expertise in supervising the construction or staffing of a school in Lagos State when the country has a Federal Ministry of Education.

“Another case in point is the allocation of N1 billion to the Nigerian Institute of Marine and Oceanography to install street lights in Delta Central Senatorial District, represented by Hon Ovie Omo-Agege, the deputy Senate President. Another cause for concern is the timeframe within which the 6,576 capital projects were generated and inserted into the FG budget by legislators.

“BudgIT has valid concerns on whether the Project Design Documents (PDD) were created as required by the 2022 Budget Public Investment Guidelines.

“A poorly designed and costed public sector project is almost destined to fail ab initio and lead to poor value for money for taxpayers. Also, the insertions of these 6,576 projects bloated the budgets of different federal ministries, contributing further to a breach of the budget ceiling safeguards announced by the Budget Office of the Federation on August 19, 2021”, the group says.

While speaking on capital budget padding, BudgIT’s Country Director, Gabriel Okeowo, said, “several projects do not meet the definition for capital expenditures according to the Fiscal Responsibility Act.

“For example, N5.6billion allocated to over 150 Meetings, Conferences, and Board Meetings was listed as capital expenditures across different MDAs. Another case is the N28million allocated to the Federal Ministry of Information & Culture-HQTRS for Quarterly Interaction With Foreign Media/Pr Lobby in its capital budget.”

BudgIT is further raising concerns over the Buhari administration’s selective opacity in its budget transparency as it concerns certain agencies that have been indicted for fraud.

While noting that the budgets of the Nigerian Ports Authority, Federal Inland Revenue Service, Nigeria Customs Service, Galaxy Backbone, amongst many others, were entirely missing from the 2022 approved budget, it said that of the Niger Delta Development Commission (NDDC), though included in the 2022 approved budget, has no breakdown of capital expenditure.

“It is no gainsaying that the National Assembly must demonstrate a stronger commitment to publishing, vetting and appraising the budget proposal from the Executive and their agencies, especially using feedback from the country’s Auditor General to assess allocations to agencies involved in misappropriations, extra-budgetary allocations, and other forms of corruption in the previous years”, it added.

“Last week, BudgIT also embarked on consultative engagements with critical institutions and stakeholders in the budget process to galvanise stakeholders into action concerning these infractions”, Okeowo adds.

In the meantime, the group is enjoining all citizens, civic groups, private sector, and the international community to urgently prevail on the National Assembly and Presidency to immediately redress and eliminate these violations in the government’s 2022 approved budget to ensure public funds work for all Nigerians and not for a privileged few politicians.

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