The Federal Government is broke and cannot fund ongoing road construction projects across the
country, a House of representative member has said. The member, who asked not to be named, also claimed that only N16 billion out of the N87.7 billion required by the Independent National Electoral Commission for voters’ registration has been released to the electoral body.
This startling disclosure was reportedly made by the Minister of Finance, Olusegun Aganga, while meeting with the House of Representatives Committee on Works. According to the member of the committee, the minister revealed this after he was summoned to give a briefing on the slow pace of work on major roads that have money allocated for their rehabilitation in the 2010 budget.Photoss Aganga & Jega
Mr. Aganga last night refuted the comments that were attributed to him, saying that he had not even appeared before a House Committee on Works for a while. Speaking exclusively to NEXT, he affirmed that although budget cuts had been made across board, the Federal Government was far from broke. “The fact is that in spite of the recent budget cuts, capital expenditure for this year still comes in at about N1.5tn which is more than double what was spent last year,” he said.
However, the house member went on to reveal that Mr. Aganga said that the federal government is facing critical financial stress that makes it impossible to fund many ongoing projects. He is also quoted as saying that ministries and departments have been asked to review their budgets downward by another 40 per cent after the official review carried out by the National Assembly. The minister told the committee that the situation is so bad that nothing is happening at the ministries because no money has been released to them.
Mr. Aganga responded by saying that this was “old news”.
“Every department was asked to review their budgets,” he said. “The oil benchmark and production output of the original budget were not optimal so all MDAs had to make cuts to expenditure.”
According to the house member, the meeting was held behind closed doors and away from media scrutiny, but credible insiders say the most shocking revelation by Mr. Aganga concerned the inability of the federal government to release the N87.7 needed by INEC for the conduct of elections next year.
Mr. Aganga again denied this saying that a total of N56bn has been released to INEC so far which is in line with the electoral commission’s release plan.
“We never release money all at once,” he said. “INEC has given us a payment plan which we have observed. The first payment was for N16bn but an additional amount of N40bn has since been released. So in total we have released 56bn according to INEC’s release plan.”
Mr. Aganga added that there was no danger that a lack of available funds would jeopardize the election timetable.
“We have been working very closely with the Honourable Chairman (Mr. Jega) since the start of this process and everything so far is on track to meet the deadlines that have been set out.”
At the time of going to the press, no INEC spokesperson was available to confirm the details of the money reported to have been released to them so far.
The INEC Chairman, Attahiru Jega, has made it clear that funds are central to the ability of the commission to hold credible elections for which it requires a comprehensive voters register. Earlier this week, Mr. Jega had also made a request for an additional 8 billion naira, to make up for the shortfall in the 2010 budgetary allocation to the commission. He said his commission was banking on receiving that amount from the budget only to discover that it has been removed.
Mr. Jega’s disclosure contradicts the finance minister’s claim that the government had given the electoral body all the funds it required. On August 20, Mr. Aganga told journalists that he was “delighted to announce that the amount due was released as soon as the supplementary budget was signed by the President”. He said the funds were released a day after the supplementary budget was passed. “We did not want to be seen to be challenging them because if anything went wrong government will be blamed for not supporting INEC. We don’t want that” Mr. Aganga had said. “I, as Finance Minister, it’s my job to implement the funding side of it and I need to assure the INEC chairman every moment that whatever he needs in terms of financial support I will make it available.”
Recently, a former minister of finance (state) Remi Babalola, said the Nigerian National Petroleum Corporation, which is in charge of managing the country’s oil wealth, was insolvent. A claim Mr. Aganga had denied. Shortly after Mr. Babalola’s whistle blowing, he was redeployed to the Ministry of Special Duties. As the exact health of the government’s finances remains unclear, billions of naira are still being allocated to new projects. Just yesterday, at the Federal Executive Council meeting, the government approved N3.59 billion for the construction of a modern office for Code of Conduct Bureau in Abuja.
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