Reality of the 2018 Federal Budget

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The 2018 Federal Budget is described by the Government as a “Budget of Consolidation”. But, just as the 2017 budget of “Recovery and Growth” only provided “recovery” for the bosses, it is likely that the 2018 budget will only further “consolidate” poverty for the poor masses.

The bosses continue to live in affluence, benefiting from “frivolous” budget allocations and low taxes. In contrast, the workers are deprived even the benefits of a decent minimum wage that can take them home. The committee established to review the minimum wage is eating fat sitting allowances whilst further delaying an increment for workers.  Many workers are also owed arrears of salary running, in some cases, into 12 months and more.  While thousands of pensioners have died due to complete neglect.

The heartless attitude of the ruling class to the plight of workers is further demonstrated by many state governors who are refusing to pay salary arrears.  This is despite receiving Paris Club and other bail out packages intended for this purpose.

Meanwhile, the 2017 Budget implementation only started in June. Eight months later, barely 35% of the capital allocations have been released. It took three months for the Ministry of Finance to release the first tranche of N336 billion for capital projects implementation.

Just five ministries gulped about 70% of the released sums, while the remaining funds were shared among over 300 ministries, departments and agencies. The favoured ministries included works and transportation, which have little to show for such allocations in terms of infrastructural development or improved public transportation.

The 2018 budget’s projected expenditure at N8.6 trillion is a 19% increase over the 2017 budget of N7.3 trillion.  A deficit estimate of N2.0 trillion is to be financed through borrowings and privatization.

The capital expenditure allocated to Ministry of Power, Works and Housing, Transportation, and Defense top the list with the highest capital allocation. Whilst critical sectors, such as Education and Health, are bottom of the list. Similarly, a recent review by the Daily Trust newspaper found that only 7.5 per cent of Federal and state budgets were devoted to education over the last three years.  In contrast, UNESCO recommends that governments should spend at least 26% of their budgets on education.  Many workers would save huge sums on private school fees if this standard was followed in Nigeria.

The first version of the Commitment to Reducing Inequality Index was recently published. This covers 152 countries and measures government action on social spending, tax and labour rights – three areas found to be critical to reducing inequality.  Nigeria has the unenviable position of being at the bottom of this Index. Its social spending (on health, education and social protection) is shamefully low, reflected in very poor social outcomes for its citizens. More than 10 million children in Nigeria do not go to school and one in ten children die before their fifth birthday.

Buhari promised to increase spending in these key areas in his manifesto, but little change appears to have been taken so far.  The ‘change agenda’ has also yet to reach taxation.  The rich in Nigeria pay only a third the level of the average for sub-Saharan Africa in taxes.  Finally, Nigeria’s treatment of workers and women in the workplace also puts it near the bottom of the rankings of this Index.

The Niger Delta Avengers has vowed to resume armed struggle and this will result in disruption of oil production.  The current administration, like its predecessors, lacks a developmental plan to address the Niger Delta Crisis. Earlier resistance in the creeks contributed to the shortfall in revenue for actualization of the 2017 budget estimates. Continued despoliation of the oil-producing areas will always provoke a fightback. The solution is not to benefit a few chiefs and war lords, but to make life better for the millions of poor working-class people.

The untold conditions of the working people will be further aggravated as politicians are only interested in appropriating budget provisions for electioneering purposes. With the 2019 elections around the corner, politicians are more likely to divert funds meant for implementing the budget to securing patronage.

We cannot continue to allow the bosses to consolidate suffering and poverty for us poor working people while they feed fat on the wealth our labour creates and appropriate the resources of the land. Working-class people must unite and fight to establish a government of the masses which will democratically formulate budgets that ensure the development of everybody and not just a few elite, is guaranteed.

by Isaac BOTTI