Osinbajo: Fed Govt to adopt zero-based budgeting

Osinbajo: Fed Govt to adopt zero-based budgeting

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The Federal Government will adopt a zero-based budgeting format for
next year, Vice President Yemi Osinbajo said yesterday.
He spoke while receiving the National Economic Summit Group
(NESG) at the State House in Abuja.

He also received a delegation from the Chartered Institute of
Stockbrokers (CIS) and the Association of Stockbroking Houses of
Nigeria (ASHON).

The zero-based budgeting, he said, will be carefully coordinated to
ensure that it is policy-driven, especially regarding the proposed social
intervention policy of President Muhammadu Buhari’s administration.

Zero-based budgeting is planning according to needs and costs,
different from the existing Envelope Budgeting or traditionally
incremental budgeting whereby the planning is based on existing
income and expenditure as the deciding factor in national financial
planning. This often incurs waste and assumes previous costs as
constant.

Osinbajo, according to a statement by his spokesman Laolu Akande,
also told the NESG that the introduction of the Treasury Single
Account (TSA) policy and its implementation by Ministries, Department and Agencies (MDAs) is a creative way of blocking leakages in the system to make way for a workable budget.

Through the zero-based budgeting, he said, the Federal Government
will focus on a bottom-up approach to development.

According to him, the Federal Government is also planning to set up
an infrastructure fund to facilitate easy funding for critical areas of the
economy.

The fund, Osinbajo said, will be planned outside of the budget to
handle major segments of the economy, such as road and power.

“Government is working out a document that would guide the
administration within the four years of its life-span,” he said.

The NESG delegation praised the Federal Government for the
introduction of the TSA and offered to be part of the advocacy as a
sound financial policy.

The vice president said the Federal Government would explore the
avenue of utilising the capital market as another means of providing
alternative funding options for the execution of capital projects.

He said allowing retail investors to come into the nation’s capital
market would ultimately deepen the market with potentials for
multiplier effects on other sectors of the economy.

Some of the problems of the capital market, he said, are due to
unethical practices by some operators.

He said those who caused the crash in the market in the past were
not punished, and urged the two bodies to engage in self-regulation as
a means of protecting investors and the market.

The leader of the delegation and Acting President of CIS, Mr.
Oluwaseyi Abe, praised the achievements of the Buhari administration
within 100 days, especially its impact on security, power and the anti-
corruption crusade, stressing on its positive effects on the overall
economy, he said a new Nigeria was being formed under Buhari’s
leadership.