Budget: Senators fault VAT hike, poor 2019 budget implementation

Chairman, Senate Committee on Diaspora, Non-Governmental
Organizations (NGOs) and Civil Societies, Dr. Surajudeen Ajibola
Basiru, has said that uninterrupted power supply is one of the key
factors needed for any country to have meaningful economic
development.

The Senator representing Osun Central Senatorial District made
this observation on Thursday during the legislative plenary session
at the Red-Chambers while speaking on the general principles of the
2020 budget estimates presented to the National Assembly by
President Muhammadu Buhari.

He observed that there is need for diversification of economy in
order to generate more revenue for the country.

“Contrary to the widespread impression that we are a very poor
country and that if we are still thinking in a conventional way we
may not really be on the path of development. I say this because
looking at the budget itself and traditionally our budget in
Nigeria, there appeared to be asymmetric relationship between
revenue generation and expenditure in the budget.

“This clearly was stated in paragraph 21 of the budget, where it
was highlighted that about 70% of the budget deficit in the 2019
budget and even under this particular budget it has already been
highlighted that N2.18trn will be the deficit under the budget.

“A lot of people out there will be talking about what has been
allocated to health, what has been allocated to education, what has
been allocated to infrastructure.

He asked a question that there is difference between allocating
money as head of expenditure and having the necessary revenue to be
able to back up such issue.

“I will rather say that as going forward we must begin to think
how do we diversify revenue base of our society. When we talk about
N250b being allocated to works, I have it on good authority that
what is even required to take care of outstanding in the ministry
of works and housing is in excess of N500b and here we has
allocated N250b and we said it is huge comparative to what have
been allocated to other sectors. I will say that there is need for
us to think outside the box in terms of how do we generate revenue
for our country.

“One good step that has been taken in the budget in this regard
is the increment of the percentage of VAT and the good thing about
it is that it is done having in mind the need for us to be able to
think in the way of progressive taxation. When we look at the way
the finance bill has been couch from the speech of the president,
the vulnerable people , the poor people in the society are being
insulated from the effect on the increment of the VAT.

“ Let the rich, the affluent who can pay, let them pay for the
development of our society. People say that we go to other country,
where every thing run very well

“It run very well because everybody in that society,
particularly the rich and the affluent they pay for the development
of that society.

“In Nigeria, we must make our rich people to also pay for the
development of our people. In the area of sectoral intervention, I
want to comment on the allocation to the power sector of N125b
but beyond the allocation, we must look at the legal and commercial
constraints to ensure the effective transmission and distribution
of electricity in Nigeria.

Senator Basiru further emphasized on the need to have constant
electricity in the country noting that it will help to boost the
economy of the Nigeria.

“We cannot talk about diversification of our economy when we run
on less than 3 hours electricity in Nigeria.

“No meaningful economic development can occur, there cannot be
diversity of our economy unless we take the issue of power, the
issue of energy very seriously.

“ I want to enjoin us as we are considering this budget to also
look at the legal and commercial constraints and re-examine what
has been done and if possible undone what has been done in terms of
ensuring that we have power , uninterrupted electricity in our
country in no time, without this, we cannot have any meaning
economic development,” he added .

The Deputy Senate Minority Leader, Senator Emmanuel Bwacha, said
the federal parliament was also guilty of condoning the executive’s
flagrant disregard for the 2019 budget implementation.
Bwacha said, “The President presents budget every year but we do
not take disciplinary measures expected to make the budget
effective.