Former TUC president, Esele, urges FG to borrow for capital project, not for consumption

Mr Peter Esele, former President, Trade Union Congress (TUC) has requested the Federal Government to borrow for capital project, rather than for consumption.
Esele, also a public affairs commentator, made the request on Wednesday, in an interview with the News Agency of Nigeria (NAN) in Benin.
He was speaking on the backdrop of  the 2022 budget proposal recently presented by President Muhammadu Buhari to the National Assembly (NASS).
He noted that from the proposed budget, it was evident that the country was borrowing for consumption rather than for capital projects.
This, he said, was evident in the comparison between the proposed allocations for recurrent and capital expenditure.
He noted that the recurrent expenditure in the proposed budget was almost half of the entire budget.
According to him, this was not a recipe for sustainable development, because with  recurrent expenditure taking larger chunk of the total budget it showed that the country was borrowing to fund its consumption.
President Buhari had on Oct. 7, presented a proposed budget of N16.39 trillion before the National Assembly for the 2022, fiscal year.
President Buhari presenting budget to National Assembly
A breakdown of the budget had shown that N6.83 trillion would be spent on recurrent expenditure while N5.35 trillion would be spent on capital expenditure.
Esele, therefore, said if the country was serious about development, there was need for a reduction in the recurrent expenditure.
He noted that in other parts of the world recurrent expenditures were not more than 20 per cent of budgets.
“So, if you are spending so much on recurrent like it’s evident in the 2022 proposal, then what do you have left for development?
“Looking at the budget for capital expenditure, it is as if we are treading on water.
“I am not saying that there will be no progress, but where the world is making five steps forward, we will be making just a step, which means we would not be making progress as we should.”
The former TUC president also noted that the debt servicing by the country was equally high.
He, therefore, advised for a pro-active action by the government in managing the nation’s debt.
He, however, lauded President Buhari for prioritisiing Security and Education in 2022 budget proposal, noting that three fundamental sectors, which include education, security and health drove a country.
He stressed that those three sectors were foundational, because if they were well laid out, it would become easier for investors to bring their investment to the country’s economy.(NAN)
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