The on-going National Constitution Convention has retained an article in the First Draft Constitution on the borrowing and lending by government to permit it to borrow money from any source but subject to parliament authorization.
Clause (1) of Article 282 provides that Government may borrow money from any source and further in clause (2) of the same article explains that government shall not borrow, guarantee or raise a loan on behalf of itself or any state organ, state institution, authority or person except as authorized by or under an Act of Parliament.
But clause (3) has categorically explained that notwithstanding clause (2) the government shall lay before the National Assembly the terms and conditions of the loan which shall not come into operation unless approved by a simple majority vote of National Assembly and pay any money received in respect of the loan paid into the consolidated Fund or into some other public fund which exists or is created for the purpose of the loan.
In this case Government will be required to lay before the National Assembly terms and conditions that includes the source of the loan, the extent of the total indebtedness by the way of principal and accumulated interests, the provisions made for servicing or repaying of the loan and the utilization and performance of the loan.
Meanwhile , the house has adopted Article 279 (1) to provide that the president shall subject to clause (2) cause to be prepared and laid before the National Assembly in each financial year, not later than ninety days before the commencement of the financial year, estimates of revenues and expenditure of the government for the next financial year.
And clause (2) of the same article has been adopted which provides that the Minister shall, when presenting the estimates of revenue and expenditure under clause (1) specify the maximum limits that the government intends to borrow or lend in that financial year.
While clause (3) states that in any year where a general election takes place, the president shall cause to be prepared and laid before the National Assembly, within ninety days of the swearing in of the president, estimates of revenues and expenditure of the government for next financial year.
The group justified that the clause would ensure that the government-elect could implement their plans and policies in the following year.
The Draft Constitution has further mandated Parliament in article 280, to enact legislation relating to the annual budget and estimates of expenditure including the method for the preparation of the budget, the preparation of medium and long term development plans indicating corresponding sources of financing.
The house adopted the recommendations by the thematic group on Public Finance that the article be adopted without amendment after it was explained that the amendments would be provided for in an Act of Parliament.
But the house agreed that the marginal note on article 280 be amended by introducing the words ‘planning and ‘ , so that it could read as planning and budget legislation after amendment.
That is very important.. i think thats what happens in the USA if am not mistaken
This is a welcome move…..well done…..Now people should understand why its important why government should be inclusive all which includes opposition appointee so not only will there be a collective understanding of our resources but will be collectively done/agreed irrespective of which front one is coming or belong to….pure democracy at least 60%
but honestly my brother, just these simple deliberations has taken ten years to come up with.
Understading money and associated terms is very crutial at personal, family, community and national levels is very very important. Many times would want to assume that things will solve themselves without working it out plans and rules of how to make, save and spend money. Some would borrow for the sake of it without onsidering how exactly to pay it back, and they would spend it unwisely, like paying heft allowances from borrowed money. Collective responsibility on how much we borrow and on what we spend it on will make us all responsible and accountable and can give us discipline. What is proposed in the constitution regarding borrowing and budgeting is good and should stand.
In my opinion, this is quite irrelevant. I believe there must be a bi- partisan budget committee in the house that can look into borrowing requisites. This would be more effective because there are several non technocrats in Parliament who would simply vote as they are told or as they imagine.
Each government makes its own budget, thats what obtains world over. What is governance if you have no previlages? Opposition budgets pend until they assume power. That what they all compete for, to rule. Budget is part of ruling.
@4 u are very right bro, I concure with u
Yes, it will stop pomp borrowing.
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