2012 budget: NASS Query DPR’s Huge N30b Recurrent Expenditure

ABUJA, February 02, (THEWILL) – The National Assembly Committees on Petroleum Upstream, Downstream and Gas development Thursday queried the N30 billion recurrent expenditures of the parastatals under the Ministry of Petroleum Resources.

Particularly, lawmakers lamented the budgetary proposals of the Department of Petroleum Resources (DPR), which will spend N30.399 billion out of its N31 billion on recurrent expenditure.

Also they revealed that the oil sector devotes over 80 percent of its budgeted funds to recurrent votes at the expense of capital budget.

These were the highpoints of the disclosures made when the Minister of Petroleum Resources, Mrs. Diezani Allinson-Madueke led heads of parastatals under her ministry to a sitting of the joint committees of the National Assembly.

Chairman of Senate Committee on Petroleum Upstream, Senator Emmanuel Paulker, who raised issues concerning the huge overhead costs in the petroleum sector, described the trend as worrisome.

He asked that ministries and parastatals should strive to raise capital votes above recurrent expenditure.

A breakdown of the budget presentation shows that out of the DPR’s N35, 997, 149, 841 budget, capital expenditure got N4, 786, 302, 790 while N31, 210, 847,051 will go to personnel costs and overheads.

The budget estimate also indicated that Personnel costs for DPR in 2012 is N30, 399, 182, 331 while the remaining N811, 664, 720 is for overhead costs.

Director of the DPR, Mr. Austin Olorunshola, however told the Joint Committee that the Department was expecting to recruit more staff within the next two weeks. “We are expecting to employ 250 workers in another two weeks,” he said.

According to Senator Paulker; “Capital expenditure is obviously at a disadvantage towards a recurrent budget. Honourable Minister, if you peruse through your 2011 (budget) and that of 2012, when you look at capital, its N8 billion for 2012 to N35 billion for recurrent and that has been the nature of our budgets.

“I’m worried as a Nigerian because if our budget is tailored towards that style, then, we are not creating hopes for investing in infrastructure and I hope you have noted that. I think there’s need for us to have a change and the oil industry is assumed to be a capital intensive industry.”  

However, the Minister of Petroleum Resources, Mrs. Diezani Allinson-Madueke told the Joint Committees of the National Assembly that the situation with recurrent expenditure profile is symptomatic of the entire civil service sector in Nigeria.

“This is symptomatic of the entire federal civil service. It’s not solely on the ministry of petroleum resources. It goes across the civil service but that is why Mr. President has called for a critical rationalization of the ministries, departments and agencies with a view to reducing the recurrent expenditure and overheads.”

She said that there is a slight “slight increase in DPR’s recurrent budget represents provisions for anticipated recruitment of new staff to improve the overall effectiveness of the department.

“You will also notice that the PPPRA is captured for the very first time under the ministry.”