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Accountability Question: PDP Governments failed
By: Isy C.A. Enwere  
 Published  July 6th, 2012

For every fiscal year, the Federal Government of Nigeria goes through the rituals of drafting the appropriation bill usually based on number of barrels of crude oil sold for that year.  For example, Nigeria’s 2012 budget of N4.749 trillion is premised on an oil price benchmark of $70 a barrel for a total production of 2.45 million barrels a day and at an exchange rate of N155/$.  The 2011 budget was predicated on oil production of 2.3 million barrels per day at a benchmark price of $65 per barrel and at an exchange rate of N150/$.  The budget of 2010 which doubled previous appropriation bills in a grand style and continued till date was projected on production of 2.35 million barrels of oil a day, at a benchmark price of $67 a barrel for a total of N4.6 trillion which was eventually overstretched to N5.160 trillion.

According to the Federal Inland Revenue Service (FIRS) revenue schedule, its contributions to the economy for seven years between 2004 and 2010 nearly equalled or surpassed the national budget.  For instance, its tax revenue schedule shows that in 2004, FIRS made a total of Nl.19 trillion in revenue, whereas the Federal budget was Nl.18 trillion. In 2005, it contributed Nl.74 trillion while the budget was N1.61 trillion. Again, in 2006, FIRS made Nl.86 trillion against the Federal budget of Nl.188 trillion. Furthermore, in 2007 it made Nl.84 trillion as against the federal budget of N2.3 trillion recording a marginal difference.

In 2008, the revenue of FIRS rose to N2.97 trillion whereas the federal budget was N2.45 trillion.  In 2009, FIRS revenue was N2.19 trillion and the federal budget was slightly higher to N2.87 trillion, again recording another marginal difference.  

However, in 2010 the revenue collected by FIRS was N2.83 trillion whereas the federal budget rose to alarming N4.6 trillion and eventually ran into a deficit of N5.160 trillion.
 

Federal Inland Revenue Service

Tax Collection 2004 to 2010

Type of Taxes

2004    =N= (B)

2005   =N= (B)

2006   =N= (B)

2007    =N= (B)

2008   =N= (B)

2009    =N= (B)

2010   =N= (B)

Petroleum Profit Tax

878.6

1352.2

1132.5

1132

2060.9

939.4

1480.4

Company Income Tax

130.8

170.2

246.7

332.4

420.6

600.6

666.1

Value Added Tax

163.3

192.7

232.7

312.6

401.7

481.4

564.9

Education Tax

17.1

21.8

28.4

59.6

59.5

139.5

89.2

Consolidate

5

4.9

5.9

10.3

27

29.9

32.9

Information Technology Levy

-

-

-

 

-

-

-

Total

1,194.8

1,741.8

1,866.2

1,846.9

2,969.7

2,190.8

2,833.5

Source: FIRS

             

During the presentation of the 2010 budget to the National Assembly, President Jonathan, then acting president had this to say, “I sign this Budget into law authorising aggregate expenditure of N4.6 trillion, so that this appropriated expenditure may be rapidly utilised to accelerate initiatives to enhance the pace of development of our nation”.  Unfortunately, the promises and goal are yet to be met even though, two jumbo budgets have passed and implemented by him; the third one is running. We have heard so much about transformation agenda but nothing is on ground to justify the jumbo budgets no matter the rhetoric.

YEAR

FIRS

BUDGET

VARIANCE

=N=

(Trillion)

=N=

(Trillion)

=N=

(Trillion)

=N=

(Trillion)

 

 

 

 

2004

1.195

1.18

0.015

2005

1.741

1.61

0.131

2006

1.866

1.188

0.678

2007

1.846

2.3

-0.454

2008

2.970

2.45

0.52

2009

2.191

2.87

-0.679

2010

2.834

4.6

-1.766

 

Kabiru Mato, a political science lecturer at University of Abuja in reaction to the 2010 budget been signed into law had this to say - “The tragedy of it all is that there seems to be already a high rate of scepticism among Nigerians because every year they vote such a large sum of money and say they are going to put infrastructure in place. But at the end of the day the money is exhausted and the infrastructure is not in place. And that is why electricity is still an issue, roads are still an issue, the issue of public transportation is virtually non-existent in Nigeria,”

Two years down the line, the above commentary remains very relevant because it catches the feelings of all and sundry. This is in spite of the high hope and massive expectations of many Nigerians prior to 2011 election. Today, security has become endemic, Boko Haram an epidemic on rampage, education and health are in shambles, the promise to revive the rail system remains a mirage; power sector remains comatose with records of frequent systemic failure despite its unbundling. Funny enough, the National Electricity Regulation Commission (NERC) continues to tell the old lies, claiming that investors will only come when tariff is increased.  Same falsehood orchestrated in the petroleum sector, more so during the oil subsidy palaver.

Sadly, it is only in Nigeria that investors want to recoup their investments within one or two years of entry because the underhand of Esau remains present. Genuine investors invest long-term, knowing the potentials of the market they are entering. They seek government incentives like tax shelter to remain in business, create and add value in the system, increase price when necessary, breakeven possibly after five years and look forward to recoup investment within ten to fifteen years. But in Nigeria, it is a different ball game that debars international practice where a big thief catches a smaller thief; the big thief gets off-hook and celebrates valour impinging the credibility of a smaller thief to subjugate critical issues.

Recently, the oil marketers gave a signal to stop importation of refined oil come July 2012 because they have not been paid for previous imports. Is it not unconscionable that Nigeria continues to import God given liquid-gold deposited in abundance to bless the weak and the strong? Is it not callous and unpatriotic for our leaders to refuse to harness our common wealth to the benefit of all? Do we not know that over 33 derivatives come from crude oil alone that few segments are brought back to us as imports?  When will this rat race end and when will the wasteful spending stop? Bring the entire World Bank crew to the country full-time under an insincere and parlous system will only produce garbage out.

Majority voted President Goodluck Ebele Jonathan to office because they thought that he would be different, a new dawn that will do things not as usual and hoping that the jumbo budgets will strike a new balance. But they are wrong. People say it is the system. Some states in Nigeria are doing far better today than previously, yet they are in the same system. Lagos State, for instance is a microcosm of Nigeria, and currently incomparable to the days when Chief Otedola and some others held firm as governors. What many expect are things that other citizens take for granted elsewhere. Build new refineries, repair existing ones, encourage rich states to build their own refineries or jointly. Fix our power sector, fix our roads, build new ones, take charge, and give citizenry sense of security, project effective education, better the health system, provide affordable and sustainable housing scheme,  develop our agriculture, and truly tackle corruption. Would these be too much to ask from a president that seems to know his onions and manages the economy of the 8th largest exporter of crude oil in the world?

I watched the Presidential chat a couple of days ago and noted that only one caller got through to the president. I personally made frantic efforts to get through myself without success. Agreed, the networks have been unstable and unreliable lately but the situation negatively portrayed the state of our infrastructures; where nothing seems to work, even at the very eye of the highest office holder of the largest black nation in the world.  Ordinarily, I found it quite disturbing, and see it as part of the inadequacies of the people who work for the president.

The burning questions therefore are thus, if FIRS has been making these huge and impactful contributions to our economy during the reign of Amazon, Ifueko Omoigui-Okauru, one wonders why they do not reflect in the yearly budgetary routine always predicated on the sale of certain million barrels of crude oil multiplied by estimated international market price.

Nigerian Customs Services (NCS) claimed to have generated a total of N4 trillion as revenue within a period of ten years between 2000 and 2011. Of this amount N2.58 trillion went directly into the Federation Account while a total of N1.6 trillion went into other accounts on behalf of other agencies of government they claimed. That will be an average of N400 billion for each of the years mentioned in revenue to the government.

What happens to other viable institutions that substantially are required to contribute to the national treasury such as Nigerian Ports Authority (NPA), Nigerian Civil Aviation Authority (NCAA), Nigerian Airspace Management Agency (NAMA) and many more?  How much do these institutions bring to the coffers of the government in revenue?

Our current foreign reserve is said to be hovering around US$35 billion or so. Does the foreign reserve both of present and past reflect these perceived surpluses that are occasioned by increase contributions in revenue from relevant government agencies?

Why is it that our infrastructures still remain paralyzed despite the three Jumbo budgets pass?

Will President Goodluck Ebele, Azikiwe Jonathan be the last of PDP or does he have any trump-card for his Transformation Agenda in the next 24 months?

While the burning pertinent questions beg answers, the Peoples Democratic Party (PDP), the giant clay footed, self rechristened largest party in Africa should begin and hastily too, pack their luggage in preparation to leave the scene along with their principals.  

Unfortunately, which among the opposition parties will give desired direction that Nigerians earnestly yearn for, taking cognisance of various inconsistencies abound both in the oppositions and the ruling party.  I agree wholly with Simon Kolawole in This Day Sunday July 1, 2012 column, SimonKolawoleLive where he asked “Is the Opposition Really Serious?”  It is a big question as they all currently seem unserious and unviable now unless they quickly wake up from slumber, get their houses in order, rebound and fathom the best way to drive a purposeful leadership.  It is a wakeup call because Nigerians will not subscribe again to half-baked arrangement or unholy alliances geared selfishly to wrestle out power to further jaundice our national future. Even with the imperativeness of holistic change glaringly obvious after thirteen now tarry fifteen years, the mantle must only go to patriots of no-business-as-usual, however ill-prepared. Thirteen or fifteen years are too long to persist on a wasteful experimentation.

For the existing landlord, leave, they must because many are ready to help clean off the annoying rubbish and nauseating walk path they may leave behind.

 

By

Isy C.A. Enwere

ICT Consultant & Social Commentator and writes from Lagos

isyenwere@gmail.com 08035697228


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