••••Why envelope system of funding budget will continue, by Budget Office
Presidential candidate of the Social Democratic Party (SDP) in the 2023 general elections, Adewole Adebayo, has faulted the 2025 budget, describing it as insufficient in addressing Nigeria’s economic challenges.
In a statement yesterday, Adebayo pointed out several gaps in the budget, specifically the “unrealistic revenue projections and the lack of transparency in the allocation of funds across key government agencies”.
He said the government’s inability to effectively manage its revenue generation system is a key issue, coupled with alleged discrepancies in the remittances from government-owned enterprises (GOEs) and other critical sectors.
Adebayo specifically highlighted the case of the Nigerian National Petroleum Corporation Limited (NNPCL), Customs, and the Federal Inland Revenue Service (FIRS), which are billed to generate a significant portion of the country’s revenue.
He said despite their potential, the agencies face numerous challenges, including corruption, inefficiency, and inadequate management practices.
According to him, “many of these revenue-generating bodies fail to remit the full amounts due to the government, resulting in major financial leakages that hinder economic progress.,”
The SDP leader further expressed his concerns about the government’s approach to managing the country’s solid minerals sector.
He pointed out that despite efforts to regulate the industry, illegal mining continues to thrive in a number of states, thus depriving the government of substantial revenue, which could otherwise contribute to the national economy.
The politician stressed that unless the government addresses these leaks, the nation’s budgetary and economic challenges would persist.
His words: “Look at solid minerals. Dele Alake has been quiet lately — he needs to explain how he’s improved revenue from this sector. What he did was raise tariffs for licensed miners and create regulatory hurdles, but illegal mining is still thriving. The money stolen from illegal mining, from Zamfara to Osun to Ebonyi, is far greater than the entire budget they’re writing now.”
IN A RELATED development, the Director-General of the Budget Office of the Federation, Tanimu Yakubu, yesterday, stated that unless there is improvement in revenue generation in the country, the envelope system of funding the yearly appropriation laws would continue.
Speaking while defending the allocation of about N285 billion to the Ministry of Foreign Affairs and its 110 foreign mission as recurrent expenditure for the 2025 financial year, Yakubu explained that there was nothing the Budget Office could do for the MDAs than to manage available resources.
He said: “For the four months I have been in office, I have been working with the system I met on ground, which is the envelope system. Even though I don’t like the system, we have been talking to ourselves on how to review the system of budgeting, and have done much to improve what I met on ground.
“We apply the envelope system in all MDAs and I have not seen any agency that is okay with what it is given. The complaint has been the same across. The envelope system started in 2006, and it has not been reviewed since. However, we should be seen to be throwing money at projects that have no bearing.
“For the Ministry of Foreign Affairs, we applied a 25 per cent review in their allocation for 2025 and what we met on ground. But right now, there is nothing I can do. My hands are tied because I have obligations to other sectors.”
He said the National Assembly should appreciate the improvement in the liquidity situation in the country, and the desire of the President to do more through the tax reform bills, adding that the bills should be passed in a manner that would put into consideration the interest of the Nigerian people.(Guardian)
