A financial expert, Dr Glenn Prince-Abbi, on Monday, urged the Federal Government to map out strategies for proper monitoring and evaluation of national budget to ensure enhanced performance.
Prince-Abbi, the Chief Executive Officer (CEO) of Espera Global Corporation, said this in an interview with the News Agency of Nigeria (NAN) in Lagos, while reacting to 2021 budget proposal.
He said that government should put in place tough monitoring and evaluation mechanisms to ensure budget performance.
He noted that previous budget performance assessments had not been impressive.
Prince-Abbi added that government needed to apply more drastic measures to prevent a repeat of past experiences in the 2021 fiscal year.
He said that revenue generating agencies must be compelled to perform optimally on their revenue target deliverables.
“Over the years, taking for instance 2015 to 2020, performances on both oil revenue and non-oil revenue projections have shown disturbing disparities.
“I think we need to put in place measures, strategic and operational frameworks which can help to bridge the gap and stem the persisting dissonance between budget making and budget performance.
“The Federal Government needs to apply more drastic measures to prevent this in the 2021 fiscal year.
“Also, revenue generating agencies must be compelled to perform optimally on their revenue deliverables. These are no times for business-as- usual,” Prince-Abbi said.
He also called on government to contain recurrent expenditure and increase budgetary allocation to capital expenditure to accelerate economic growth.
“Recurrent expenditure must be put on progressive containment in order to release the much needed revenues to address capital expenditure in priority areas.
“This will strengthen macroeconomic resilience while building and accelerating economic growth.
“One of the fundamental draw-backs in Nigerian government budget making is in the area of capital expenditure share of the budget.
“In the first budget, namely the 2016 budget prepared by the President Muhammadu Buhari-led administration, bold actions were taken to strengthen the percentage of capital expenditure (CAPEX).
“CAPEX represented 30 per cent of the total budget. The President promised to continue to raise the percentage allocation for capital expenditure in future years.
“The government kept this promise, though very modestly. For instance, capital expenditure plan for 2017 was 30.7 per cent and 2018 was 30.8 per cent.
“However, in the 2019 budget, capital expenditure plan fell back to 30 per cent and in 2020 it fell further to 24 per cent, and now in the proposed 2021 budget, it is 29 per cent.
“While being an improvement on the CAPEX spend of 2020, it is still a poor showing as far as the need for better quality aggregate spending is concerned,” Prince-Abbi said.
He said that government should take deliberate measures and unrelenting steps in improving capital expenditure ratios and desist from pandering to the political expediencies of rising recurrent expenditure.
“With a strategy to move much-needed revenues to the capital expenditure side, government should come down heavily on all existing and potential areas which sadly drive unwholesome acceleration in recurrent expenditure,” he added.
NAN reports that the Federal Executive Council recently approved N13.08 trillion budget proposal for 2021 fiscal year.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said the budget estimate was made up of N2.083 trillion capital expenditure, which she described as 29 per cent of the total budget.
According to her, the budget proposal is predicated on N379/$ exchange rate, oil benchmark of $40 per barrel, oil production volume of 1.86 million barrels per day, including 400,000 condensates, Gross Domestic Product (GDP) growth of three per cent and 11.95 per cent inflation rate.