As the proposed appropriation bill has risen again to N943 billion, Nigeria may be up for another retrogressive growth due to her debt service provisioning for 2015.
The proposal, which rose from N712 billion in 2014, and represented 14.26 per cent of the 2014 budget, is now 21.14 per cent of the 2015 fiscal projections.
The development is now a clear indication of more development setbacks, occasioned by series of debt deals in recent years, especially as the tune of the debt service now exceeds the proposed capital expenditures for 2015, put at less than N700 billion.
Stakeholders, who feared that the country may have gone back to the days of huge debt crisis, lamented that the major issue with the increased spending on debt servicing is that the bulk of these debts were not incurred in accordance with the due process of law.
The Lead Director of Centre for Social Justice (CSJ), Eze Onyekpere, said: ?With a debt profile of $69.6 billion, the Federal Government and the states cannot point to capital projects and activities or human capital developmental projects worth that much.
?A good part of the debts were incurred to fund recurrent expenditures instead of capital expenditure, against the clear provisions of the Fiscal Responsibility Act (Sections 41- 44).
?To imagine that Nigeria is spending more on debt service than capital expenditure is a nightmare- N310 billion more on debt service than capital expenditure. The debt service provision is 148.84 per cent of capital expenditure and at the same time, amounts to 26.17 per cent of our retained revenue.?
The controversial Service Wide Votes included in the budget by the Presidency rose from N301.84 billion, being 6.05 per cent of the 2014 budget, to N348.69 billion, being 7.82 per cent of the 2015 proposal, which runs counter of the austerity measure claims.
The Oronsaye Committee, commissioned by government to reform the cost of governance, had corroborated the widely held view of the abuse of the utilisation of the service wide vote, noting that budget heads currently captured under the vote could actually be included either under specific Ministries, Department and Agencies (MDAs) or the contingency vote.
However, stakeholders have also noted that given the constitutional provision for the contingency vote, it is believed that the service wide vote is not only an aberration, but also an avoidable duplication, which made the committee to recommended that the service wide vote should be abolished and this seemed not to have gone down well with government.
?In this period of austerity measures, let the Presidency and the National Assembly lead the way in the adjustments. They will soon discover that Nigerians are wonderful followers. Specifically, the two arms of government should slice their votes by a minimum of 50 per cent.
?The benchmark price of crude oil should be reduced to a realistic estimate, not more than $55 per barrel, to avoid generating apologies for budget failure. We should have a moratorium on borrowing unless it is tied to specific capital projects. The President and National Assembly should also endeavour to fix the debt ceilings so as to rein in frivolous borrowing and ensure that new debts build the capacity to grow the economy and our ability to repay. It is also imperative to reallocate service wide votes to the MDAs in need of them,? Onyekpere added.