Get Guardian on Google
The Nigeria Employers’ Consultative Association (NECA), has warned that the 2020 budget might instigate massive retrenchment of workers and labour unrest in the country.
This projection indeed casts doubt over the ability of the budget to ensure economic growth and job creation as envisioned by the Federal Government.
The Director-General of NECA, Timothy Olawale, who disclosed this in Lagos, noted that the document was not clear on the inclusion of the consequential adjustment of the national minimum wage in the Appropriation Bill.
[ad]
This omission, he said, might lead to more rounds of the strike in the coming year by labour.
While urging the National Assembly to expedite action in order to return the budgetary process to a January –December fiscal year as enshrined in the constitution, he cautioned that the oil benchmark in the budget, which proposes $57 per barrel, reflected a reduction from $60 per barrel in 2019 approved the budget.
Olawale said the benchmark price is just slightly above the current average price of $58 witnessed in the course of eight months in 2019.
He noted that any further impact on the global economy could result in the crash of oil prices with reduced demand globally due to slow down in the global economy, as already forecasted by the International Monetary Fund (IMF), and World Bank in their recent reports.
He advised Federal Government to, as a matter of urgency, commence disposing of government non-oil assets and gradual improvement in non-oil revenue.
To manage the budget efficiently, he advocated a reduction in the cost of governance at all levels, promotion of efficiency and accountability, and transparency of the budget process.
With capital projects estimated to gulp N2.46trillion, Olawale said the priority should be given to on-going projects before new ones are started and a sound monitoring and evaluation mechanism clearly defined for successful implementation of the budget.
On VAT increase, he maintained the earlier position that it will erode some of the gains recorded in recent times in economic growth.
He informed that with 85% of VAT collection going to states and local governments, there is the need to focus closely on utilisation of the additional funds accruing to states and local governments for actual developmental purposes.
[ad unit=2]
