FG added N538bn Unspent 2017 Capital Vote to 2018 Budget

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Achieves 73.5% implementation Revenue shortfall, late passage of budget adversely impacted execution, says Budget DG

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Kunle Aderinokun

With barely a week to the end of the lifespan of the 2017 budget, the federal government has achieved an unprecedented 73.5 per cent implementation of the appropriation, deciding to carry over the remaining 26.5 per cent to the 2018 fiscal year. The 2018 appropriation bill was transmitted to President Muhammadu Buhari last Friday night for assent. A document obtained by THISDAY from a reliable presidency source showed that out of the N2.029 trillion allocated to capital projects (exclusive of FGN special intervention projects) in the 2017 Appropriation Act, N1.491 trillion had been released to Ministries, Departments and Agencies as at May 21, 2018, representing 73.522 per cent implementation.

The unspent N538 billion, the source said, would be carried over to 2018 fiscal year, which is expected to start on June 5 or the date the president assents to the appropriation bill.

The National Assembly had in May 2017 passed the N7.44 trillion appropriation bill, which comprised N2.987 trillion recurrent (non-debt) expenditure and N2.177 trillion capital expenditure. The N2.177 trillion capital vote was inclusive of N150 billion for FGN Special Intervention Programme.

The document containing the details of the capital releases , prepared by the Federal Ministry of Finance, showed that power, works and housing ministry, which was allocated N650.074 billion, being the chunk of the total capital budget, had received N506.935 billion, representing 77.981 per cent for its projects. Transportation took N125.974 billion (52.118 per cent) out of N241.709 billion for projects, while agriculture and water resources got a release of N129.664 billion (62.309 per cent) out of N208.099 billion earmarked for projects in the ministries.

Furthermore, the federal government stated in the document that it released N149.798 billion out of the budgeted N271.089 billion to defence and security for capital projects, representing 55.258 per cent. Besides, N81.456 billion was released for projects in health and education ministries, which represents 72.235 per cent of N112.766 billion allocated in the budget.

Justice and social capital projects got N26.060 billion (59.444 per cent) out of N43.839 billion earmarked in the Appropriation Act, while N130.568 billion (95.594 per cent) out of N136.585 billion was released for administration projects.

Others got N31.782 billion (58.305 per cent) out of N54.765 billion, while N309.490 billion (99.824 per cent) out of N310.037 billion was released for capital supplementation.

The Budget Office of the Federation noted in its Draft Budget Implementation Report for the third quarter of 2017, “Greater portion of government’s available budgetary resources were directed to structural reform of the economy and the provision of critical infrastructure in the roads, power, housing, rail and aviation sectors as well as the provision of physical and food security.

“In view of this, a total of N2,174.50 billion was allocated to capital spending in the 2017 budget. MDAs’ Capital Vote Utilisation: the late passage of the 2017 Appropriation Bill, the extension of the implementation of the 2016 capital budget to 5th May, 2017, the shortfall in expected revenue as well as the increasing non-discretionary expenditures of government affected the implementation of capital projects for 2017 budget in the third quarter of the year.”

Essentially, the report stated that data from the Office of the Accountant General of the Federation on 2017 Capital Performance for MDAs as at September 30, 2017, showed that only N377.02 billion was released and cash backed to MDAs for their 2017 capital projects and programmes.

The budget implementation report for the second quarter of 2017 also showed that a total of N96.35 billion was released for capital expenditure in the second quarter of 2017 under the 2016 budget. Cumulatively, it added, N59. 45 billion capital expenditure was expended under the 2016 budget during the first half of 2017.

“Funds were, however, not released for capital projects/programmes under the 2017 budget. This was due to the extension of 2016 capital budget implementation to 5th May, 2017, the late passage of the 2017 budget as well as the need for MDAs to finalise their procurement processes,” the budget office explained in the report.

In the preface to the report, Director-General, Budget Office of the Federation, Mr. Ben Akabueze, noted, “Despite the socio-economic challenges that continued to face the Nigerian economy, government was able to deliver N370.13 billion capital budget expenditure in the third quarter of 2017.”

This, he pointed out, “significantly contributed to the positive GDP growths witnessed in the second and third quarters of the year after a spell of five consecutive negative growths. The sustenance and consolidation of these reform initiatives are, therefore, the driving force of the 2017 budget implementation.”

Akabueze added, “The execution of the 2017 budget in the third quarter of the year was very challenging in numerous fronts, mainly due to the extension of the 2016 capital budget to 5th May, 2017, effectively halting the execution of the 2017 capital budget until the tail-end of the second quarter of the fiscal year.

“The execution of the 2017 budget was also adversely impacted by the late passage of the budget as well as the shortfall in expected oil and non-oil revenue receipts. However, the government had continued to meet its non-discretional expenditures.”

Naija247news
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Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

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