Budgets as Conduit Pipe for Govt Officials

The Presidency, National Assembly and public officials conspire to use the annual national budget to fraudulently siphon public funds.

An independent review of the 2012 budget by icirnigeria.org and a coalition of civil society groups has revealed that ministries, departments and agencies, MDAs, of the federal government, including the Presidency and the National Assembly, pad their budgets to provide hundreds of billions in slush funds for corrupt public officials.

A forensic look at the appropriation by the National Assembly for MDAs and other arms of government show that virtually all of them use nebulous and dubious sub heads such as drugs and medical supplies, welfare packages, refreshments and meals, foodstuff and catering and Fumigation and cleaning among others to lay the ground for pilfering of public funds.

The review which also exposes waste and mismanagement in the allocation of the country’s resources points out how hundreds of millions of naira is illegally appropriated for the welfare, security and feeding of senior public officials who already enjoy outlandish allowances and perquisites of office.

In a pattern that shows a deliberate and coordinated effort to pad their budgets several ministries provided votes that are questionable, ridiculous or alien to appropriation processes while in others the votes are so unclear that it would be impossible to monitor them.

In some cases funds are fraudulently allocated twice under separate votes for a parastatal and the parent ministry. In other instances of officially sanctioned corruption, funds are allocated for the same projects for several years.

All the budget fraud is perpetrated and sustained by collusion between budget officials in the MDAs, officials of the budget office and its parent ministry of finance as well as the two arms of the National Assembly which appropriates funding for running the government.

The budget review shows a trend whereby the commonest and easiest means of padding an agency’s appropriation is through food, refreshments, catering, foodstuff; welfare packages; security vote and medical services and drugs purchase.

While many Nigerians go hungry government officials have close to N2 billion in this year’s budget for food and other culinary pleasures. The president and the vice president alone take nearly N693.5 million of this vote. While President’s office gets nearly N430 million for food and drinks, his deputy’s takes over N264 million.

Of course, nearly a billion naira was initially budgeted for food and catering in the presidency but public outcry against it forced the figures down.

But if many agree that feeding the president and vice president and their guests in the Presidential Villa is still acceptable, many would frown at the huge funds appropriated for other public officers and their offices.

For example, a total of N118, 241,819 is appropriated for the office of the head of service of the federation for foodstuff, catering meals and the like.

Others who got heavy votes for things like food, meals, refreshments and catering include the budget office, N194, 001,021; ministry of finance, N66, 969,198; ministry of culture and tourism, N37, 412,183.18 and Niger Delta ministry, N25, 906,994.

Another dubious subhead used by public servants to cream off money off the budget is “welfare package” for which the National Assembly appropriated nearly N1.5 billion, mostly to the Presidency, ministries and parastatals. This is in spite of the fact that all public servants receive allowances meant to take care of their welfare.

Of the total amount, the Presidency alone gets 481,287,340 or close to one third. Other big receivers of welfare packages are defence headquarters, N200 million; ministry of defence N 58,328,409; the Nigerian Police N170,818,524; Niger Delta ministry N64,871,904; ministry of finance, N96,151,968;the budget office, N122,895,000 and office of the accountant general,N92,734,898.

A former director in the federal civil service familiar with the budgeting process explained that welfare packages are legitimate as it is meant to take care of what he called repatriation, burial expenses and the medical expenses of civil servants who fall critically ill and have to be flown abroad for treatment.

According to our source, the repatriation fund in the welfare package dates back to colonial times when British officials who retired or are returning home were paid some money which was termed “repatriation allowance”. The tradition of including such items in the budget has been maintained even when it is no longer needed.

Other things covered by the welfare package, he explained, are expenses of the burial rites of deceased civil servants which he said is allowed by law. But he could not quote the law. The source also said the law allows for welfare budget to take care of medical expenses of a civil servant who falls critically ill and has to be taken abroad for treatment.

He, however, agreed, speaking from experience of his service years, that the welfare package never gets used for this purpose.

“Although the law allows for budgeting for welfare of civil servant, the truth is that many of them are not even aware of the provision so the money eventually gets pocketed by the big ogas. So it has become a money making avenue for those who know about it,” the source disclosed.

Another questionable item in the budget of many ministries and government agencies is security vote for which over N6.5 billion is provided in the 2012 budget. It is doubtful what this vote is for as even ministries and agencies that get support from the police to secure personnel and office buildings have huge funds appropriated for security.

The ministry of Aviation, headquarters, takes the biggest share of N6, 247,666,248 for what it calls “New Security Strategy for Airport”. No further details are given about which airport and what kind of security strategy or if it involves buying of equipment and which type.

Thus, it would be impossible for anybody, even the receiving agency, to monitor implementation. This is another fertile ground for corruption. And the National Assembly approved the vote.

Equally ridiculous is the appropriation for security  of N158, 359,040 to the Nigerian Security and Civil Defence Corps, NSCDC;  N104,504,161 to the office of the head of service and N56,577,744 to the office of the accountant general.

These allocations and their approval throw up a lot of questions about the integrity of the budget process. For example, why does the NSCDC need over N158 million for security when it also got over N405 million appropriated for the purchase of security equipment?

What do the offices of the head of service and accountant general need security votes for? Is it for the office or the person who occupies the office? Why would these two offices require and get over N160 million and other agencies and ministries do not require such a vote. Even the parent ministry of the accountant general’s office which houses it got just N26, 387,765 as security vote.

If these votes are questionable for their unreasonableness or because of the difficulty they pose for implementation monitoring, others are downright outrageous, even ridiculous.

Perhaps the most ridiculous vote in the entire 2012 budget is the N22, 806,460 appropriated for the National Theatre for the purchase of typewriters. In this age of technology why would the National Theatre need typewriters?

Other ridiculous appropriations in this year’s budget include N300 million approved for the ministry of information for a media tour of the states; N41,625, 000 for the purchase of three Discovery 5.0 engine capacity Jeeps for “procurement,  monitoring and evaluation” in the ministry of mines and steel; the sum of N17, 232,340 for implementation of a yet to be passed Petroleum Industry Bill, PIB, in the petroleum resources ministry and N80 million for a roadmap on the Freedom of Information Act.

Even more preposterous is the approval of N126, 091,750 for “spectacle advances” in the petroleum resources ministry and another N869, 509 for the same purpose in the ministry of works.

There are other equally laughable and provocative appropriations in the budget. An example is the 2,766,274,637 approved in the budget for “consultancy and conceptual design of Kano Airport terminal building.”

The Kano Airport already has a terminal building. Even if it needs upgrading would that cost N2.7 billion? How much would be required to build a new one if the design alone costs this much? Instructively, in 2010, over N602 million was budget for remodeling of the terminal building of the same airport.

The budget approved for the ministry of Aviation has some of the most outrageous votes. From all indications, some of the votes are deliberate ploys to misappropriate approved budgets.

For example, N550, 000,000 is appropriated for the “consultancy and conceptual design of airports in Lagos Enugu, Rivers and Cross Rivers. But airports already exist in these places and there is absolutely no need for a new design to be conceived for them.

Even more significantly, Enugu airport, mentioned in this particular vote, has an N8.4 billion allocation for its total overhaul. So why seek money for the same purpose in another vote head? In 2010 the same airport got N1 billion for the expansion and resurfacing of its runway.

Besides, there is another N7, 030,000,000 budgeted for the modernization of the airport terminals in Enugu, Lagos, Rivers and Cross River states. So why the duplication of votes?

Equally fraudulent is the repeated budgeting of funds for airport construction projects in Yenagoa, Bayelsa State, Jalingo, Taraba State, Dutse Jigawa State and Abeokuta, Ogun State for several years now.

In the 2012 budget, N550,000,000 is appropriated for consultancy and construction of airport terminal in Yenagoa; N378,000,000 for same in Abeokuta, Ogun State and N750,000,000 for Dutse, Jigawa State. In the same vein N120, 000,000 is budgeted for the conversion of the Jalingo airstrip in Jigawa State into an agro airport.

However, money had been appropriated for these same projects in previous years. For example, N162, 042,482 was budgeted last year and N1 billion in 2009 for the Abeokuta airport, while N191, 210,128 was budgeted for the Jalingo airstrip project. Even the Yenagoa Airport received budgetary provision of N500 million as far back as 2008.

Repetitive budgeting is also found in many other ministries, particularly in demands for computers and ICT accessories. Virtually every MDA purchases computers every year. In the 2012 budget, purchase of computer hardware and software alone is to gulp over N6 billion. That is in spite of a budgetary provision in 2011of N4.85 billion.

In 2011, the federal ministry of works budgeted N1.8 billion for computers and software, yet in the 2012 budget it still got N95.7 million. The ministry of lands and housing got a total of N551.4 million for computers and software in 2011and still received N727.8 million in 2012.

The ministry of foreign affairs got N200.8 and N207.8 for computer purchase in its 2011 and 2012 budgets respectively.

But the Nigerian Presidency is, perhaps, the guiltiest in perfecting the art of repetitive budgeting in what appear to be an avenue of providing slush funds for government officials. Some of the most ridiculous, fraudulent and mindless appropriations go to the presidency.

For example, for some reason the Presidency budgets money every year for rehabilitating the State House, Marina, Lagos and Dodan Barracks, Lagos in spite of the fact that they are hardly ever occupied.

Last year, N628, 640,000 was budgeted for what was termed “outstanding liabilities on partial rehabilitation of SH Marina and Dodan Barracks. This year, again, rehabilitation of the two presidential residencies got N500, 571,330 in the budget.

In a similar fashion, monies were appropriated for the purchase of kitchen and catering equipment in the Presidential Villa for two consecutive years. In 2011 this vote got a whooping 553,594,442 and in 2012, it still got over N5 million.

For the Presidency, it also appears that the upgrading of facilities is an unending pastime. In 2010, N312, 099,475 was budgeted for the “completion of upgrade of Villa facilities”. But, two years later, more than double that amount, a total of N643, 887,523, was again appropriated for the same purpose.

But the most embarrassing appropriations are those made for the vice president. The upkeep of the vice president constitutes a huge drain pipe on the nation’s resources, it appears.

For instance, the upgrading and furnishing of the vice president’s official resident is costing Nigerian tax payers money heavily yearly. In 2011, the vice president’s residence and guest houses received over half a billion in the budget.

The breakdown is “household equipment for vice president’s residence”, N150 million; “furnishing of vice president’s guest house in Asokoro”, N100 million and “acquisition, upgrading and furnishing of VP’s guest house at Aguda” received a whooping N400 million.

The vice president also got another N300 million for the purchase of “utility and operational vehicles”.

However, in a brazen and fraudulent manner, the same items were again budgeted for in 2012, clear evidence that slush funds are provided in the budget for the office of the vice president.

For, in 2012, the vice president again got another N112, 005,600 for household equipment and materials. There is also N207, 168,598 provided for the extension and furnishing of the VP lounge in Aguda.

Another outrageous appropriation is the provision of N230, 132, 597 in the budget for acquisition, upgrading and furnishing of the guest house at Aguda even though N400 million was budgeted for same purpose in 2011.

The truth really is that the Aguda house is actually the vice president’s official residence for now. It is meant to be the president’s guest house but is presently occupied by the vice president.

In some ministries, the allocations are so irresponsible, breaking every rule of fiscal responsibility that it calls to question the integrity of the legislative process of budgetary approvals.

For example, some ministries take such liberties that billions of naira is approved for projects without giving any detail at all as to exactly for what the money would be used. In some cases, it is difficult not to conclude that monies have been provided in the budget to be pilfered.

For example, the ministry of agriculture has a vote head “Purchase of Agricultural Equipment” amounting to N26.8 billion. The only detail provided for this huge vote are items like seeds, improved seeds, seed dressings, seedlings, fertilizer, herbicides, small scale processing facilities and investing in agro processing capacity, poultry meat, fish farm and so on, many of them repeated several times in the vote.

There are no details of quantity, costs and locations of the purchased items or projects. And the two houses of the National Assembly raised no queries over this fiscal rascality.

In the same ministry, a budget of over N1.4billion is approved for the construction of road. The only explanation given is that N820 million is for the construction of 15 kilometers access roads to six staple processing zones at N15 million per kilometer.

There is no detail about exact location of the road construction making it difficult to track implementation.

The remaining N600 million is provided for the “rehabilitation and consolidation of 200k (kilometers) of existing roads” at N5 million per kilometer. Here, again, no detail is provided about location.

In the ministry of water resources most of the appropriations for the river basin offices are so nebulous that it would be practically impossible to determine whether the monies are eventually spent or not.

Several hundreds of billions are budgeted for projects in communities for which details are not provided. Besides, many of these projects are duplicated in the budget approved for millennium Development Goals, MDGs.

For example, the Sokoto Rima River Basin Development Authority has a vote of N650 million for small irrigation in Zamfara West Senatorial District. But there is no information about the location of any of the projects.

In the same manner N313, 150,098 is budgeted for South Chad irrigation project by the Chad Basin River Basin Development Authority without any breakdown of costs and location.

Competent sources conversant with the budgeting process in Nigeria said that many of the projects approved for execution in constituencies in the rural areas are actually lobbied for and put in the budget by members of the National Assembly.

According to one source, members of the federal legislature approach different MDAs asking them to include the funding of projects in their communities in their budgets.

This, he said, is common in the ministries of works, environment and power and the MGD office.

According to our source who once headed a parastatal but who does not want to be mentioned, senators and members of the House of Representatives put a lot of pressure on implementers of the budget to ensure that projects go to their constituency. Sometimes, the source alleged, such legislators also dictate the contractor that handles such projects.

Many people particularly point accusing fingers at the national Assembly for the failure of the annual budgets to meet the development needs of the country and the inherent fraud and corruption in the fiscal space.

In terms of budget transparency, the National Assembly is guiltier that any other arm of government. The last assembly removed the appropriation for the federal legislature from public scrutiny and put it in first line charge so that its funding comes directly from the federation account.

Thus, the budget of the National Assembly only spells out the bulk of its expenditure without giving details of overheads, current or recurrent expenditure or minute details of what money is appropriated for. That makes the National Assembly unaccountable to any institution.

It is a situation that Auwal Musa Rafsanjani, executive director of the Civil Society Legislative Advocacy Centre frowns at as too dangerous to allow to continue.

He observes, “One of the funny things that are happening in this democracy is that the National Assembly wants every government agency to be accountable to it but they are not accountable to anybody. And it cannot go that way.”

Continuing, he said “You cannot exonerate the National Assembly. At least, whether consciously or unconsciously, they allowed those wastages and duplications to continue to be in our appropriations because it is they who are expected to look at it.”

Rafsanjani also points out an inherent danger in situation which leaves the entire vote of the National Assembly in the hands of a few people to do as they like.

“Today as I speak, even the National Assembly members do not know their own budget. It is only the principal officers that know the budget. So, the National Assembly members are like you who don’t know their own budget too. It is the principal officers that do everything. This is the system that has been going on and that is why even development partners laugh at us because Nigeria is just a heap of corruption,” he said.

(Check Interviews section for full text of the interview with Rafsanjani).

Eze Onyekpere, a lawyer and director of the Centre for Social Justice agrees that the National Assembly has shirked its responsibility of ensuring fiscal responsibility in the budgeting process.

Apart from insulating its budget from scrutiny, Onyekpere said that the National Assembly ignored representations from civil society organisations pointing out latent corruption in the estimates of many MDAs and went ahead to appropriate funds for dubious vote heads.

According to Onyekpere, several civil society organisations under the aegis of Citizens Wealth Platform did a review of the budget and discovered a lot of fraudulent padding, repetitive and completely outrageous votes in the 2012 budget.

“We published the review we did, submitted it to the budget office and also gave copies to members of the National Assembly. Every senator and member of the House of Representatives got a copy,” he said.

(Check for full text of the interview with Onyekpere in the Interviews section)

The lawyer, however, observed that the recommendations were ignored.

“When the budget was passed we did another review and we discovered that over 90 percent of our proposals were ignored,” he disclosed.

He concluded in frustration, “In spite of all the things we pointed out nothing was done. It appears that the National Assembly did not do its home work.”

But Onyekpere also blames the executive for a lack of political will to ensure that the budget meets the developmental needs of the people and leaves no room for corruption.

First, he observes that the executive arm of government itself in deeply enmeshed in the corrupt the budgetary process.

“Of course everybody knows of the huge feeding allowance of the president. Everybody knows about huge sums spent on watering lawns in the Villa. Everybody knows about repetitive demands for the renovation and purchase of guest houses for the vice president.”

That is why, he says, the executive cannot frown at the high handedness of the legislature when it concerns the annual budget.

“It is unfortunate. The legislature is supposed to check the executive and the executive is somehow also supposed to check the legislature but if there is a conspiracy between the man who is supposed to do the job and the supervisor what happens? The executive and legislature are in an incestuous relationship,” Onyekpere stated.

Since the executive and legislature have abdicated their roles of ensuring of ensuring fiscal responsibility, Onyekpere believes that the Nigerians have to take over the budgeting process in order to democratize it.

This, he said, civil society groups in the country are working at by organising sensitisation town hall meetings in the geo political zones on the budget.

“What we are doing is that before the end of June we are going to go to all the geo political zones and hand these documents to community development associations, market women groups, artisan groups and so on, telling them about things that have been put in the budget for their communities so that they can follow up” the CENSOJ director stated.

“We are going to hold town hall meetings in the communities and distribute these documents so that people will know and begin to ask questions. We are tired of a few NGOs asking the questions and becoming predictable. It is better for the people at the grassroots to begin to ask the questions,” he enlightened further.

These would not only ensure that the people decide what their needs are and thus what is appropriated for capital projects but also enable them monitor implementation of the budget.