Why FG Budgeting Plans Are Changing Under The Buhari Administration

*President orders all MDAs to join IPPIS

In order to achieve the socio-economic goals of the President Muhammadu Buhari administration, amidst dwindling oil revenues on the one hand, and the vast number of Nigerians who live in poverty, on the other, there is a need to change the way budgeting is done.

“The greatest challenge to us is controlling ballooning recurrent expenditure and freeing up resources for growth-related capital expenditure,” according to the Vice President, Prof. Yemi Osinbajo, SAN.

He said the government will do something about poverty, “something more direct, different from how we have done it in the past. So budgeting has to be done differently.”

Prof. Osinbajo was speaking earlier today while meeting with permanent secretaries and director-generals for a one-day sensitization session on the 2016 budget and 2016-2020 Medium Term Plan of the federal government.

For instance, he explained that budget planning under the Buhari administration would restore the long term, policy-based approach to budgeting alongside a Zero-Based Budgeting which questions all expenses ensuring greater transparency. This is unlike the traditional budgeting where baseline assumptions are taken for granted.

Under the Zero-Based Budgeting, the VP added, expenditures would be reduced since every item would have to be justified. Besides, the Zero-Based Budgeting also helps to align government’s spending with the declared policy directions of the Buhari administration.

Explaining how the Treasury Single Account also fits in, Prof. Osinbajo said the TSA helps to avoid the under-declaration of revenues by ministries, departments and agencies of the federal government.

“There have been in the past, MDAs that worked outside the budget, for instance the NNPC, which was running huge revenues and spending outside the budgetary process, that is why we have the TSA,” the Vice President asserted.

The TSA therefore enables government to free up revenues that would then become available for economic growth and development.

On the need to control expenditure of the federal government which he said is too high, the Vice President stated that MDAs would therefore be expected to cut costs.

He went on to disclose that President Buhari has already instructed that every agency including the military and the universities must join the Integrated Personnel and Payroll Information Systems, IPPIS, which is helpful in curtailing some of abuses in the salaries and emoluments’ processes of the government.

Continuing he said, “we need to cut overheads too, we can’t spend as we used to spend. We need to block leakages, increase accountability and transparency. This is an absolute necessity, the level of corruption is an outrage and we have to deal with it.”

Also speaking at the session held at the Presidential Villa, the Head of Service, Mr. Danladi Kifasi praised the Buhari presidency for the innovation of such a session coming early in the budget planning process.

According to him, “this is the first time that Permanent Secretaries are invited this early for budget planning. It means we become critical owners of the process, not just a part of it.”

Laolu Akande

Senior Special Assistant-Media & Publicity

In the Office of the Vice President