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Private sector to challenge National Assembly over 2011 budget

By on March 30, 2011

The organised private sector has vowed to challenge the insistence of the National Assembly that the 2011 budget be implemented as passed by it.

Frank Nweke , the director general and chief executive of the Nigeria Economic Summit Group (NESG), said yesterday in Lagos that the structure of the budget was inimical to the operations of the private sector.

He was speaking at the interactive session held between the finance minister and the private sector, organised by the Debt Management Office (DMO).

According to Mr. Nweke, the budget proposal sent by the executive was already cumbersome to implement before the Senate passed its own version.

“For the National Assembly to unilaterally, without any legal basis as far as we are concerned, go ahead to increase this national budget year on year and entrench the kind of controversy we see, is totally unacceptable. What that means is that the private sector will be further crowded out from the financial space,” Mr. Nweke said.

Legal action

Mr. Nweke, a former minister of communications, said there should be no competition between the executive and the legislature, and decried the current situation where recurrent expenditure accounts for a major chunk of the national spending at the expense of critical sectors of the economy.

“This is not acceptable. We recognise that the private sector must speak up. If it is necessary to institute legal action to seek interpretation of the constitution of this country as to who has legal powers to appropriate fund and whether the legislature has the power to distort the budget as it does each year, it is something that we are prepared to take up,” he further said.

President of the Institute of Directors (IoD) of Nigeria, Chike Nwanze, said the institute was also ready to challenge the National Assembly on the matter.

“We are having a meeting on Thursday where this will be discussed and if we have to institute legal action. We are ready to consider that option,” Mr. Nwanze said.

According to him, the National Assembly has not put the interest of the entire country into consideration before passing the budget.

Not implementable

Finance minister, Olusegun Aganga, declared last week that the budget passed by the legislators was not implementable due to its expansionary implication on the already parlous state of the economy.

He said the executive would continue to engage the legislators to find a way of resolving the matter.

The Senate last week passed a budget of N4.972 trillion, N338 billion higher than the initial figure of N4.22 trillion submitted by President Goodluck Jonathan to a joint session of the National Assembly in December.

The appropriation passed by the Senate was predicated on a benchmark of $75 per barrel of petrol up from the $64.7 projected by the executive and a crude oil production of 2.3 million barrels per day.

The Monetary Policy Committee of the Central Bank of Nigeria a fortnight ago increased the benchmark interest rate by 100 basis points from 6.5 per cent to 7.5 per cent, in response to the huge spending by government in the 2011 fiscal year.

The Executive and the Legislature have in recent times engaged in bickering over the budget, thus leading to tension between both arms of government.

Source : 234next