Nigeria's Economy in Focus: Budget Extension Sparks Debate
Budget Blues: National Assembly Extends 2024 Capital Budget, Again in a move that has drawn sharp criticism from economic experts and civil society, the National Assembly has, for the second time, extended the implementation deadline for the capital component of the 2024 federal budget. The new deadline now stretches to December 31, 2025, effectively pushing the operational window of a two-year-old budget into the next fiscal year.
Why the Repeated Extension?
Lawmakers, led by the Chairman of the Senate Committee on Appropriation, Senator Olamilekan Adeola, cited the need to complete ongoing capital projects as the primary justification. Senator Adeola emphasized the importance of preventing project abandonment and ensuring that Nigerians receive "value for money." Some reports also indicated that Senator Adeola highlighted insufficient resources as a factor, suggesting the government's inability to fully capture all proposed expenditures in the new budget, thus necessitating a more effective utilization of the 2024 allocations.
This latest extension follows an earlier one. The 2024 budget's initial implementation deadline was December 31, 2024. However, in December 2024, President Bola Tinubu had secured the first extension to June 30, 2025, also citing the need to complete ongoing projects and optimize budgetary allocations. As the June 30, 2025, deadline loomed, many critical projects remained uncompleted, paving the way for this fresh, controversial extension.
Implications and Criticisms:
The repeated extensions have ignited a firestorm of debate, with many pointing to serious implications for Nigeria's fiscal health:
* Two Budgets Running Concurrently: The new deadline means Nigeria is now operating two federal budgets simultaneously: the extended 2024 capital budget and the already active 2025 budget.
* Weak Execution Capacity: Economists, financial experts, and the Organized Private Sector view these repeated extensions as clear evidence of weak execution capacity within government Ministries, Departments, and Agencies (MDAs).
* Fiscal Indiscipline: Critics argue that this practice severely undermines fiscal discipline and complicates efforts to track budget performance and accountability.
* Economic Distortions and Corruption Risks: Concerns have been raised that running parallel budgets can lead to economic distortions, contribute to increased money supply (potentially exacerbating inflation), and heighten the risk of project duplication and corruption due due to reduced transparency.
* Lack of Justification: Some lawmakers, like Senator Dickson, have publicly criticized the federal government for failing to provide a compelling justification for the continuous extensions, hinting at possible cash flow problems or a disproportionate focus on political agendas over governance.
While proponents argue that the extension is a pragmatic step to avoid abandoned projects and ensure judicious use of funds, the prevailing sentiment among many stakeholders is one of concern over the long-term impact on Nigeria's economic management and credibility.
I'm Aisha shehu
Talksocialtalka News
