Budget crisis looms over oil price benchmark

house_of_reps_120 November 2013, Abuja – President Goodluck Jonathan aborted Tuesday his 2014 budget presentation at the National Assembly. He sent a letter excusing himself.

House of Representatives Speaker Aminu Tambuwal entered the chamber at 11:25 a.m and read the President’s letter.

Jonathan cited the disparity between the oil price benchmark of the Senate and the House as reason for his action.

The letter reads:
“Please recall that I had written requesting the Honourable House of Representatives to grant me the slot of 12 noon on Tuesday 19th November 2013 to enable me address a Joint Session of the National Assembly on the 2014 Budget.

“However, considering the fact that, whereas the Distinguished Senate has approved the Medium Term Expenditure Framework (MTEF) based on a benchmark of $76.5 per barrel, the Honurable House of Representatives has used a benchmark of $79 per barrel, it is infeasible for me to present the budget in the absence of a harmonised position on the MTEF.

“In the circumstance, it has become necessary to defer the presentation of the 2014 Budget to a Joint Session of the National Assembly until such a time when both respected chambers would have harmonised their positions on the MTEF. It is my hope that this will be in the shortest possible time.”

This is the second consecutive postponement of the 2014 budget presentation.

It became glaring at 9:50 am yesterday when the Sergeants-at-arm began removing the labelings and demarcations meant for the joint sitting in the Green Chamber that the President would not honour the National Assembly with his presence.

The sit- at- home order to the over 3,000 National Assembly workers from grade level 01- 14 by the National Assembly, the closure of all banking and commercial activities, the excessive security screening at the entrances, the facelift of the complex, the prim and proper dressing by lawmakers, the red carpet all cam to nought yesterday.

Some senators and House of Representatives members were disappointed at the President’s action.

The presentation, which ought to have been made on November 12, was cancelled based on differences over the 2014-2016 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP), especially on the oil benchmark.

While the Presidency fixed $74 for the benchmark, the Senate passed $76.5 while the House fixed $79 in the passed MTEF.

The All Progressives Congress (APC) lawmakers went into a closed door meeting to discuss the aborted presentation.

It was learnt that the APC lawmakers were not disposed to the “drop-on-the-table” budget presentation.

After Speaker Tambuwal read the President’s letter, the House attempted to treat some bills which the movers said they were stepping down. Consequently, the House adjourned at noon.

Minority Leader Femi Gbajabiamila said: “We have not taken a decision on the MTEF because the Senate and the House have different positions and we have to reach a joint decision through
executive session and harmonisation and arrive at a joint position.

“Since the budget is based on the passage of the MTEF, I think the President has given a good and cogent reason for not making it today (yesterday).

“I don’t know if the House is really expecting the President to make the presentation or not, yes there is some talk about that but to some of us, it is not just about the presentation.

“This is because, what we are talking about is the integrity of the budget and for the sake of the integrity of the budget, we have to realise that it is not just about our democracy but about the integrity of an arm of government.

“Under the constitution, it is the President that have to lay it and if it is read that ‘causing to be laid’ is interpreted to mean you can send anybody, then that is setting a bad precedence.

“It means that a President can decide to send his wife or any of his Personal Assistant on Domestic Affairs or any of his cronies.

“He may even decide to mail the budget but this is unacceptable; the argument that we had a precedence does not hold water because the President in question (late President Yar’Adua) was incapacitated and we all knew what happened to him unfortunately.

“It is an exception to the rule. This President is not incapacitated.”

Another member, Pally Iriase (APC Edo) said the budget presentation was too important for the President not to make the address, considering the fact that there is no State of the Nation address.

House spokesman Zakari Mohammed said: “It is not our fault that it wasn’t presented because the House is still within the timeframe for passing the MTEF.

“When we look at it from another angle, the coming of MTEF to the NASS was even belated because, according to the Constitution, the MTEF is supposed to be transmitted to the NASS six months before the end of the year, but we got this in September.”

He said the reason given by the President could not have been the sole reason for the aborted presentation.

According to him, the President presented the budget at a time when the Senate had not passed the MTEFF.

“Last year, the Senate was yet to pass the MTEF but the House had passed it when the President presented the budget; it was not an issue then.

“The House will go through the legislative process by raising a Conference Committee, harmonise the position of the two Houses, but there is no definitive date for its passage,” he added.

Senators were angry.
Senator Kabiru Gaya (Kano South) said: “First of all, let me say one thing. The President gave a date last week that he would be coming and when he gave that date even the interim MTEF had not been discussed.

“So, he gave a date earlier, so if it was ready for that date we would have received it without even passing the MTEF.

“So, all I am saying is that the President should have come here today, present his budget and issue of benchmark can be discussed and agreed during the deliberations on the budget.

“I am sure that was what happened. Even the MTEF was not discussed until after the budget was passed. So, I believe maybe the President has another reason.”

Kabiru Marafa (Zamfara Central) said: “We have to agree on the same benchmark because that is what the Constitution of Nigeria says. No one has an upper hand above the other.

“We have to agree as soon as practicable because we have to do away with the issue of arm twisting and impunity because this is getting too much from the executive.

“Why should you peg the benchmark? You cannot eat your cake and have it. There is separation of power. The issue of budget is the business of the legislature.

“The Constitution provides that all revenues acruing to the federation be retired into an account and after which it will be disbursed to the three tiers of government.

“What we have now is that the executive put a benchmark and have excess which was used to cover inadequacies on the increase everyday and it is nobody’s business.

“It is for the executive to implement. The excess crude account is illegal. That is why, according to governors recently, N5billion is missing from the account. Who removed the money? Funds should be appropriated before they are spent.

Mohammed Maccido ( Sokoto North) said: “The two chambers have to agree on the same benchmark because that is what the Constitution says. We have to deliberate on this issue and we have not done that.

“Our leadership at both chambers had sat down with the Minister of Finance too. I was in the meeting too and what was agreed upon was that we should try as much as we could to adhere to $76.50 per barrel but that is within the leadership. When you get to your different chambers, it’s a different ball game.

Heineken Lokpobri (Bayelsa West) said: “I don’t think that what is happening is strange. Normally, if the House passes a different version from the Senate, there will be a conference committee and as it is the House passed $79; the Senate passed $76.5.

“There has to be a formal conference committee that will harmonise both positions.

“Once that is done, the President will now come and present the budget but Nigerians need to know that this law mandating us to approve the MTEF before the budget can be presented is a recent law, it wasn’t there since 1999.”

– The Nation

About the Author