The 2024 budget of Nigeria, amounting to N27.5 trillion, has evoked diverse reactions in the public sphere. There is a mix of both pessimism and optimism regarding whether the budget will positively impact the lives of ordinary citizens, especially given the proposed N1.33 trillion allocation to infrastructure. Concerns have been heightened due to the historical underperformance of Nigeria’s recent budgets.
The allocation of 5% of the budget, equivalent to N1.33 trillion, to infrastructure, encompassing works and housing, power, transport, water resources, and aviation, raises apprehensions among Nigerians. Despite the country’s substantial infrastructure deficit, experts argue that this allocation may not sufficiently address the annual infrastructural gap.
Named the “Budget of Renewed Hope,” a detailed examination reveals that Security and Defence received the highest allocation of N3.25 trillion, constituting 12%. Education followed with N2.18 trillion. The 2024 budget is 10.8% higher than the 2023 budget, totaling N24.82 trillion.
The Minister of Budget and National Planning, Atiku Bagudu, stated that the budget aims for an estimated revenue of N18.32 trillion, with a deficit of N9.18 trillion. Notably, N8.490 trillion (30%) is allocated for debt servicing, N9.918 trillion for recurrent non-debt expenditure, and N7.717 trillion for contributions to the Development Fund for capital expenditure.
Key benchmarks include a Crude Oil Benchmark of $77.96 per barrel, a daily oil production of 1.78 million barrels per day, and a foreign exchange rate of N750 to USD. These factors are crucial for the nation’s economy, particularly amid challenges caused by the removal of fuel subsidies since June 2023, resulting in increased costs of transportation, food, and essential services.
CEO of SD & D Capital Management, Mr. Idakolo Gbolade, expressed skepticism about the budget achieving its intended impact, highlighting that the N1.33 trillion allocated to infrastructure does not reflect the savings from fuel subsidy removal. He criticized the budget estimates, citing unrealistic assumptions, and raised concerns about the haphazard implementation of budgets in the country.
Prof Godwin Oyedokun from Lead City University emphasized the need for a departure from historical budget underperformance, urging the 2024 budget to lift Nigerians out of multidimensional poverty if properly implemented. He called for increased fiscal responsibility from the government.
In contrast, renowned economist Prof Segun Ajibola expressed optimism that the budget could positively impact Nigerians if all provisions were effectively implemented. However, he underscored the need for alternative funding models, such as Public Private Partnerships, to address the significant infrastructural deficit in the country. Ajibola highlighted the importance of eliminating middlemen in the distribution process for social development and poverty reduction programs to have a meaningful impact on targeted beneficiaries. Overall, he expects the 2024 budget to improve the lives of average Nigerians, contingent on robust implementation.