Budget: Ekweremadu Rues dependence on borrowing, late approval

Budget: Ekweremadu Rues dependence on borrowing, late approval

As the debate on the general principles of the 2019 Appropriation Act began at the floor of the Senate on Wednesday, the Deputy President of the Senate, Senator Ike Ekweremadu, has urged the Federal Government to explore other creative ways of funding the much-needed infrastructural development rather than continued reliance on borrowing in order not to mortgage the future of the country.

Ekweremadu also decried the perennial non-compliance with the constitutionally prescribed financial year, being January 1 to December 31.

He said: “The appropriation bill is possibly the most important bill in any legislative year because this is the bill that deals with the interests, hopes and aspirations of not only citizens, but also foreigners and those unborn.

“That is why I would like to start my contribution by addressing the issue of the debt profile. I am happy that the Senate Leader mentioned that it is becoming increasingly unsustainable and we must be able to caution ourselves before we mortgage the future of our children.

“Some countries, including Indonesia are already in danger because of past borrowings. We must, therefore, be cautious. Yes, it is important that we address our infrastructural needs through appropriate financing, but I believe that there are other creative ways of funding these infrastructures including public private partnership, PPP, and concession.

“For us to depend on borrowing means that we are putting our future in jeopardy and therefore, it is time for us to ensure that our debt to GDP ratio must not exceed the acceptable level”.

On the late submission and approval of budget, the lawmaker observed: “Increasingly, we have deviated from the financial year prescribed by the Constitution. The Constitution says in Section 318 that the financial year is a period of 12 months from 1st January of the beginning of every year, which means it is usually between the 1st of January and 31st of December or any other time as may be prescribed by the National Assembly.

“Over the last four years, the average period for which this budget has been passed by this assembly has always been in May and I believe it is a very dangerous trend. We must see how we can go back to the financial year prescribed by the constitution because I know that those who prescribed that period must have thought it wise at the time.

“The executive consistently has brought the budget quite late, usually towards the end of December or usually before we leave for break in December. That makes it impossible for the National Assemble to consider the budget until sometime into January.

“The implication, therefore, is that the budget is passed late and starts running quite late. Nigeria is a developing country where we need a lot of infrastructural development and most of these of constructions can only take place during the dry season. So, it is not good to pass the budget in May, just at the verge of the rainy season”.

“If the constitutionally prescribed financial year must be adjusted, it should be backwards to around September so that the whole of the dry season from October to sometime in April can be utilized”.

Meanwhile, it could be recalled that the current National Assembly had last year amended the constitution to provide for compulsory laying of the budget proposal by the President 90 days (about three months) before the end of the year, while parliament is obliged to pass it before the beginning of the new financial year (January 1). However, the executive did not assent to the bill.

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