Budget 2018: Financial experts task FG on liquidity surge

Dr Samuel Nzekwe, former President, Association of National Accountants of Nigeria (ANAN), said the Federal Government should release of funds from 2018 budget in tranches to effectively monitor likely inflation.

Nzekwe gave the advice in an interview with our reporter, on Thursday in Lagos.

He said releasing funds into the system in bulk, following the signing of the 2018 budget by President Muhammadu Buhari, could lead to inflation and worsen the tough economic situation in the country.

Nzekwe said releasing funds in piece-meal was necessary because with a few months remaining in the 2018 fiscal year, the economy might not accommodate the release of huge funds.

He said: “Therefore, a surge in liquidity could trigger inflation but may not be so if the government releases funds as and when due because things will flow systematically.

“Again, because we are already in almost half of the year, there is tendency for implementation of the 2018 budget to be done in a hurry.

“This may result to the economy being suffocated with liquidity.”

Nzekwe said the nation had always faced challenges in its budgetary process but insisted that the N9.12 trillion budget would be realistic with effective monitoring of all spendings.

“I don’t care how much is the budget figure, but I mind how the implementation and the monitoring will be.

“This is because no matter what the figure is, once the budget is not implemented well, there will be problem making the nation to be going back and forth,” he also said.

On how budget delay could be stopped in order to move back to the January to December fiscal calendar, the ANAN boss suggested that unspent funds could be returned to the Federation Account at the end of every year.

This, he said, would put an end to the perennial challenge of carrying over of each year’s budget to the next.

He said, “Now the 2018 budget was just signed in June. Does that mean it will run from this month to December?

“If so, this means by January 2019, we will be running two budgets – part of the 2018 for January to June and also that of January to December.

Nzekwe also urged both the executive and legislature to ensure the yearly budget was ready for implementation on time.

Also, Dr Onafowokan Oluyombo, Associate Professor, Accounting Department of Pan Atlantic University, said there was need to ensure clarity of duties between the legislature and executive.

Oluyombo said, “If the executive sent in a budget proposal to the National Assembly, they are not expected to add some other information because they are not to execute it.

“Secondly the time-lag is not to the best interest of the nation.”

According to him, the consistent budget delay does not portray the country in a good light to international communities.

Oluyombo, also the head of the department, said the government should be concerned about the international communities’ perception of Nigeria, especially as it affects the flow of investment to the country.