2022 Budget: FG still within allowed deficit limit, says FRC


    The Fiscal Responsibility Commission (FRC) has declared that the federal government had not breached any law in the 2022 budget proposals by exceeding the three per cent threshold prescribed as deficit by the Fiscal Responsibility Act (FRA 2007).

    The proposed N16.4 trillion aggregate budget with a N6.26 trillion deficit is 3.9 per cent above the three per cent limit permitted by FRA, although it allows exceptions in emergency situations.
    Responding to questions at a press conference in Abuja yesterday, Chairman of the Fiscal Responsibility Commission (FRC), Mr. Victor Muruako, said in every law, there was always an exception.

    According to him, the devastating impact of the COVID-19 pandemic which almost crippled the global economy provided an exception (in line with the FRA) for the federal government to overshoot the three per cent threshold.

    He said: “You are aware that the FRA 2007, while it clearly defined what the threshold should be, it also made room for exceptions. The exceptions in this case are quite obvious. This issue has been canvassed earlier and the Commission has come out to take a position that there is room for exception to the provisions of the Act.
    “And what more, you would also realise that government and indeed the parliament had taken a bold step to also marginally amend the Fiscal Responsibility Act through the Finance Act 2021 (Section 61).

    “You are also aware that the review of the Finance Act is now an annual ritual. As the budget is coming, the parliament also takes a look at the Finance Act. So, the government is still acting within the legal framework.

    “For every law, there must be an exception. While we continue to push and urge that we should ensure that the deficit level does not exceed what it should be, but we should also appreciate some of the obvious challenges that the government has found itself – the challenges of COVID-19 which almost crippled the world economy.
    “Nigeria is not an exception. COVID is still there, particularly the third wave which is the Delta variant. So, we shall continue to see how we can battle with the economic implications.”

    Muruako said in a bid to enthrone a culture of fiscal transparency, accountability and prudence at the sub-national level, the Fiscal Responsibility Commission was set to commence sensitisation workshops across the six-geopolitical zones of the country, commencing with the North-west.

    To kick-start the workshops, christened ‘Transparency Accountability and Prudence (TAP)’, Muruako said the North-west zone of the country would host the workshop between October 25 and 26 in Kano.
    The South-west would be the next to host the workshops with the theme, ‘Fiscal Transparency and Sustainable Development at the Sub-nationals’ between November 1 and 2 in Lagos.

    According to him, the workshops would be held across the six-geopolitical zones after which the possibility of holding in each of the 36 states of the federation and Abuja would be considered.
    The FRC chairman disclosed that arrangements were in place to ensure a hitch-free and successful set of events that will contribute significantly to increase in public awareness and citizen engagement on fiscal transparency and public finance management in Nigeria.

    He noted that citizen engagement on public finance management is paramount to us at the FRC because its enabling law, the Fiscal Responsibility Act, 2007, provides in Section 51 that: “A person shall have legal capacity to enforce the provisions of this Act by obtaining prerogative orders or other remedies at the Federal High Court without having to show any special or particular interest.”

    Section 48, he added, further provides that “the federal government shall ensure that its fiscal and financial affairs are conducted in a transparent manner and accordingly ensure full and timely disclosure and wide publication of all transactions and decisions involving public revenues and expenditures and their implications for its finances.”

    These, he stated, are potent instruments of the law which citizens and groups can rely on to drive advocacy for reforms and push for adoption of best practices in the public finance management space of our dear country.

    “This is why we are hopeful that these two workshops will provide a basis for us to advance this sub-national advocacy to other zones of the country in the months ahead. Gentlemen of the press, as partners in progress for a better Nigeria, I therefore humbly solicit your cooperation and support to embark on this initiative,” he said.

    He said many states were showing a lot of enthusiasm on enthroning fiscal responsibility, accountability and prudence in the management of government business.
    According to him, the FRC has been training some states’ fiscal responsibility agencies on how to ensure transparency in government affairs.

    On the amendment of the Fiscal Responsibility Act, 2007, Muruako said the FRC had done its best, noting that in the 7th parliament, the Commission made efforts to amend the Act by raising the consciousness of the people, adding that it got to the committee stage and ended there.
    He recalled that in the 8th parliament, the same scenario played out.

    Also as a temporary measure to fill its manpower need, the FRC yesterday signed a memorandum of understanding (MoU) with the Nigerian Institute of Quantity Surveyors (NIQS) led by its President, Mohammed Abba Tor.
    Muruako said the benefits from partnering with the Institute were obvious and enormous.
    According to him, the FRC would tap from the huge professional endowment of NIQS in carrying out its mandate, especially in areas where it lacks the required manpower.

    For instance, he noted that when the FRC is going out for project management and evaluation of capital projects, it would have seasoned professionals and experts in these fields, noting that doing so would add value to what the commission does.

    He noted that if the commission were to pay for the services of quantity surveyors, engineers, and architects, among others, it would be hamstrung by paucity of funds, considering its lean allocations.

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