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Traders’ Association Faults Agric Sector Budget


Stack of grains on display at an agricultural forum; Need for the Federal Government to release funds to increase food production and check scarcity

Stack of grains on display at an agricultural forum; Need for the Federal Government to release funds to increase food production and check scarcity

Wants 2003 AU-Maputo Declaration’s 10%
THE National Association of Nigerian Traders (NANTS) has described as ridiculous the N76,753,672,273  proposed budgetary allocation for the agriculture sector. X-raying the budget of the Ministry of Agriculture and Rural Development, President of the Association, Ken Ukaoha, said the percentage for agriculture is a meagre 1.26 per cent, a far cry from the 2003 AU-Maputo Declaration, which requires countries to allocate at least 10 per cent of an annual budget to agriculture.

Ukaoha said that over the years, the body language of successive governments have suggested Nigeria signed the agreement alongside other countries as a face saving measure. He said the yearly appropriation to the sector, since 2011 to 2016, indicated 1.8, 1.6, 1.7, 1.4, 0.9 and 1.25 percentages. This, he said, is a far cry from what smaller countries in Africa are budgeting for the sector.

Comparing Nigeria’s agriculture budget with that of other developing countries, he said Malawi has overshot the Maputo agreement and has reached close to 27 per cent; Zambia, Burundi and Mali – 10 per cent; Niger – 13 per cent; Sierra Leone – close to 3 per cent; and Nigeria – down the ladder with 1.25 per cent.

Ukaoha disclosed that 36.54 per cent (N28,052,924,405) is planned for personnel costs; 2.21 per cent (N1,699,622,233) proposed for overheads; and 61.23 per cent (N47,001,125,634) for capital expenditure, saying this means: the share for agriculture as a percentage of the total capital budget is just 2.54 per cent, while the bulk of the money would be spent on administration and personnel. According to Ukaoha, this is not likely to ensure food security.

He, however, said the present administration deserves commendation for its determination to reduce overheads, personnel costs and other service wide votes by 7, 8 and 19 per cent, respectively.

He said: “It is unprecedented in Nigeria’s expenditure plan (at least in the last 10 years) that the national budget proposes reduction in these areas. The implications are that more funds would be freed and may be channeled to capital expenditure and development projects. Also, the proposed 61.23 per cent to capital development of the sector is a demonstration of government’s commitment to the development of the sector and the nation as a whole. Specifically, it implies that at both levels there are plans to improve infrastructure: more roads, silos, water supply, health facilities, etc., which eventually lead to socio-economic development.”

While pointing out weak considerations and increased deficit that may affect agriculture, Ukaoha said the budget, predicated on the revenue projection of N3.86 trillion, of which about 75 per cent was planned to be earned from daily crude oil sales of 2.2 million barrels at $38 each, is not realistic. He said between the commencement of budget planning and when it actually came to the legislature for appropriation, the price of crude in the international market had fallen to around $28 and $32 per barrel, creating a loss of $10 multiplied by 2.2 million barrels per day, amounting to $22 million daily.

Picking holes in the budget as lacking continuity on some of the laudable agriculture policies of the past administration, Ukaoha said it is imperative for the Buhari administration to review the budget and continue with policies that would help farmers.

He said: “There is disconnect between the annual budget allocations and small scale farming in the country. About 66 per cent of the population is engaged in different types of farming activities with a further 90 per cent engaged at small-scale levels. About 80 per cent of food produced locally in the country is also produced through farming at the smallholder farms. Despite these, small-scale farmers in rural communities hardly feel the impact of the annual budgets.

“As small-scale farmers are mostly illiterate, they are neither able to comprehend budget technicalities nor demand any interventions. They are thus left at the mercy of market forces and competition over farming input with the fewer, richer, more educated and powerful ‘political farmers’ taking greater advantage of any agricultural improvement interventionist policies.

“If agriculture is to play the role of GDP growth driver through contributing 36 per cent of the GDP in 2015 (ATA lifespan) and by extension 2016, the input required by producers of 80 per cent of the food consumed by Nigerians and Nigerian industries must not be left to sheer market forces.

“Reviewing the budget process at the federal level shows that about 18 distinct processes exist in the course of a budgeting cycle and that CSOs and farmer organisations can intervene, especially at public hearing stages in the National Assembly. Since the review observed that the 2016 agriculture budget as proposed is not gender sensitive enough (only 1 percent of its projects and funds targets youths, women and small-scale farmers), there is need for proper re-visitation to address the gap. This is the only way the 2016 budget can impact on small-scale farmers.

“In general terms, the budget and that of almost all the other MDAs including the Presidency and the NASS is so unfair, especially in a country where 70 per cent of the citizens survive daily on the fringes of society, lacking education, health, housing, adequate food and bear extra tax burdens to fund the deficit of the 2016 budget. Therefore, these over-bloated, frivolous and repetitive items can be properly and efficiently pruned and re-allocated to critical capital projects and programmes that will help eradicate poverty in Nigeria.

“Unpack the capital expenditure allocation and re-allocate the funds to implementing agencies and institutions, while the main Ministry of Agriculture assumes its normal role of coordinating, directing and regulating. Continue the Growth Enhancement Support Scheme (GESS). Though the scheme had its challenges, but enough experience has been gained to improve its operations. Evidence shows that it significantly reduced corrupt practices common with farm input subsidy. The proposed 2016 agriculture budget is silent on farm input for smallholder farmers; a continuation of an improved GESS will ensure that smallholder farmers benefit from this budget.

“The huge amount allocated for research and development should focus more on improving the productivity of smallholder farmers, instead of discouraging them. Efforts should be on developing affordable and appropriate technologies suitable to their size of farm and financial resources. Countries like India, China and the Philippines offer good examples of where smallholder farmers are thriving. Extension services of the government should be strengthened by a recruiting of new extension agents, building of their capacity, and providing them with incentives and facilities necessary for effectiveness in the field.

“We re-echo the need for a space that allows smallholder farmers, especially women and other critical stakeholders to participate in prioritising government agriculture initiatives that will eventually be funded through budgetary allocation. A forum should be created by the FMARD for the participation of smallholder farmers, especially women and Civil Society Organisations in the budgetary processes for ownership, and in order to also inform articulate priorities.

It is imperative that budget line items are explicit and unambiguous, while budget notes are appropriately provided in order to promote transparency and accountability. The monitoring and evaluation of agricultural capital projects should be made more robust by involving CSOs to conduct independent evaluations. Such CSOs involvement will give critical perspectives that will complement internal evaluation done by the FMARD that will lead to improvement in the sector.”

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