The implication of late passage of 2019 Budget
February 4, 2019
The Nigeria Employers’ Consultative Association (NECA) yet again decried the recurring delay in the passage of national budget, which appears to have become a culture.
Speaking to the Press in Lagos, the Director General of NECA, Mr. Timothy Olawale described as disheartening, the continuous delay in the passage of national budget which, sadly, is becoming a culture. He stated that “The continuous delay in budget passage year on year is worrisome and continues to be a major source of concern for the private sector. The importance of quick passage of the budget cannot be overemphasized as it plays a very critical role in economic development.
Looking at the trend from 2014, the earliest time the budget was passed was in 2016 and that was in the month of March. Nigeria’s fiscal year begins in January and ends in December; hence, we cannot begin to imagine the dire consequences of the late passage of the budget on national development and business growth.
“In Ghana, for instance, the budget for the 2019 fiscal year was approved in November 2018. In Ethiopia, the budget for the 2018-2019 fiscal year was approved few days before the commencement of the fiscal year in July 2018. Similarly, in Egypt, the budget for their 2018-2019 fiscal year was approved about a month to the commencement of the fiscal year”. The stability and predictability of the budgetary process of these countries could be one of the reasons why they are becoming the new desired destination for foreign investments.”
While speaking on some of the adverse effects of late passing of the budget, he stated that “For some years now, the process leading to the approval and passing of budget in Nigeria has always been a victim of the proverbial fighting of two elephants. A critical component of the budget such as capital expenditure, which to a large extent plays a major role in economic development, suffers. Infrastructural reforms, which are meant to attract investments and improve the lives of the populace, are put on hold and business decisions, which could translate to expansion and employment generation frustrated.”
While advising on the way out, Mr. Olawale stated that “If we truly want to get the country on the track of economic prosperity as soon as possible, we need to accord extreme importance to the early passage of the budget. There has to be a defined time frame which should be religiously followed as seen in other countries. We also urge our Lawmakers to give the 2019 budget the utmost importance it requires as budget passage should not suffer at the expense of politics”.