Poor budget practices is responsible for recession – Utomi


An economist, Prof. Pat Utomi, has said that poor budget management process is responsible for the current economic recession in Nigeria and not the fall in oil prices.

Utomi made the observation in Awka on Wednesday while speaking at the maiden edition of Dr Emmanual Egboga Budget Roundtable, organised by the Nnamdi Azikiwe University Business School.

In a lecture on “Budget Process in Nigeria; Challenges for National Development”, the renowned economist said the economic downturn could have been avoided if the managers of the budget system were proactive.

He decried the reliance on crude oil, which he said, constituted about 12 per cent the Gross Domestic Product for the revenue component of the budget against other sectors.

He also noted that the oil revenue had beclouded the budget managers from seeing the great potential of taxes as a major source of budget funding.

Utomi, however, said that government at all levels should do more to encourage the private sector to set up businesses to be able to tax them. He said that governments in Nigeria were doing more to kill businesses rather than encouraging them to grow due to high cost of operational environment created for investors.

“Dependence on oil has made Nigeria to lose sight of taxes as a major source of budget funding, but government must create conducive environment for businesses to thrive.

“Poor budget practices, rather than fall in oil prices, are responsible for Nigeria’s recession,” he said.

The Director, Unizik Business School, Prof. Austin Nnoyelu, said the roundtable was packaged by the school to discuss issues in budgeting which was a major challenge to the wheel of national development.

Nnoyelu said the outcome was targeted at evolving the road map out of the problems and chart a new course towards greater development of the country.

“Over the years, issues relating to budgeting in Nigeria at the states and federal levels have been trending, the process has been faced with myriads of challenges and problems.

“Budgeting is a very serious business; at times it is complex and complicated; the Unizik Business school is committed to unraveling the issues and hopes to provide a roadmap or intellectual capital that will redirect and reorient the entire mechanisms involved in the budget development and implementation process,” he said.

The Vice Chancellor of the institution, Prof. Joe Ahaneku, thanked the resource persons and promised that the roundtable would be an annual event. Ahaneku also said that the university would continue to provide answers to the various national development questions as a research and learning centre, while urging policy makers to take advantage of the session.