Four months into the 2024 fiscal year, the federal government is yet to begin implementation of the capital component of the 2024 national budget which has many implications on the nation’s economy.
This was as the government said that it has released funds for all requisitions from Ministries, Departments and Agencies for the implementation of 2023 capital projects.
The budget titled “Budget of Renewed Hope” has a proposed expenditure of N27.5 trillion, an estimated revenue of N18.32 trillion and N8.7 trillion for the 2024 fiscal year.
Accountant General of the Federation Mrs Oluwatoyin Madein said the government was still implementing capital allocations of the 2023 budget that the National Assembly extended at the end of 2023 year-end. She said the decision to continue with the implementation of the 2023 budget was taken after consultation with the minister of finance and coordinating minister of the economy, and minister of budget and economic planning when the lawmakers who ought to give a directive failed to come up with any.
The AGF said “We even called for cash plans to be uploaded by 15th and 21st March. We did that on 15th March while we are still on the one for 21st March,” she stated yesterday at a 1-day stakeholders interactive/sensitization session on the revised policy on cash management and bottom-up cash planning.
The situation may impair the government’s January-December budget cycle, vis-à-vis its national development plan 2021-2025. Apart from the contractors and other direct beneficiaries, most sub-nationals have their budgets tied to the federal budget.
However, she said her office has compiled all the cash plans that were submitted for 2023 “so that we can close 2023 now and commence 2024. As soon as we are through with this programme, we will advise for submission of 2024 from the month of May… We’ve called for the initial cash plans – monthly cash plans, annual cash plans – which we are already reviewing.”
Dr Madein said one of the reasons the 2024 cash plan has not started rolling out was based on a decision to ensure that the revised policy on cash management and bottom-up cash planning commence with the implementation of the 2024 capital budget.
She urged the accounting officers at the programme to get their cash plan documents ready so that by 15th May, you will have been able to upload into the cash plan system.
Meanwhile, the minister of finance and coordinating minister of the economy, Mr Wale Edun has said again that the federal government is committed to maximum overhaul of the nation’s economy to improve the lives of Nigerians. Speaking at the Abuja event, the minister said Nigeria is now on the road to reform and transparency, adding, “We must be determined that even though we could not do it yesterday, we will definitely do it tomorrow. He therefore urged the accounting officers at the workshop to embrace the financial reforms of the government for national good.
This is as the government has concluded in the revised policy on cash management that any amounts held in the Treasury Single Account (TSA) system not immediately needed will be invested in interest-yielding deposits. To do that, the AGF will direct the Central Bank of Nigeria (CBN) to invest idle cash balances in short-term instruments at the ruling or competitive rate.
The revised cash management policy among other things stipulate that all MDAs will now have to submit their monthly expenditure needs for consolidation by the funds department (cash management unit) at the OAGF headquarters; monthly cash payment needs will now be based on capital commitments to be settled in the month as well as recurrent needs for the specific month.
It also provides that capital and overhead cash needs will henceforth be based on legal and financial commitments that is in line with the approved cash plan entered in GIFMIS. Where actual commitments do not support expenditure needs, the MDA cash plan (outflows) would be reduced without recourse to the MDA in question accordingly.
The new policy provides strategies for cash flow planning and management such that inflows are realisable, outflows controlled and there is value for money in public expenditure, avoiding discretionary spending, minimising deficits, and borrowing within limits as well as investment of excess and/or idle cash.
It focuses attention on a strategy that ensures government commitment to budget implementation, effective public expenditure funding and management and strategies for the investment of idle cash and financing of gaps when they occur.
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