N7.3trn 2017 budget‘ll end recession – Buhari

President Muhammadu Buhari yesterday presented to the National Assembly, an aggregate budget revenue profile of N7.298 trillion for the 2017 fiscal year, which is about 20.4% increase over the N6.06 trillion 2016 budget estimates.

The occasion was also one which provided the President an avenue to reel out his scorecard on the performance of the 2016 budget, which according to him, had attained 59% implementation; representing N3.58 trillion out of the N6.08 trillion budgeted, as at September ending.

He pointed out that the 2017 budget, tagged “Budget of Recovery and Growth”, was higher than the 2016 Appropriation by about 19.95 per cent.

Buhari said the implementation of the 2016 Budget was hampered by the low oil prices in the first quarter of the year, and disruptions in crude oil production which led to significant shortfalls in projected revenue.

It would be recalled that there had been various attacks by the Niger Delta Avengers and other groups in the oil producing region that reduced the country’s oil production by about 50 per cent.

He said this also negatively affected revenue collection by the Federal Inland Revenue Service (FIRS) and the Nigerian Customs Service (NCS).

He, therefore, assured that 30.7% of the 2017 appropriation bill will be capital in line with the determination of federal government to reflate and pull the economy out of recession as quickly as possible.

Parameters of the expenditure are predicated on oil price benchmark of $42.5, oil production rate of 2.2million barrel per day and exchange rate of N305 to a US dollar.

This is against the N290 to a US dollar earlier proposed in the 2017-2019 Medium Term Expenditure Frame work (MTEF) forwarded to both chambers of the National Assembly for approval in October this year.

A breakdown of the budget proposals as submitted by the President shows that N419.02 billion was earmarked for statutory transfers, N1.66 trillion for debt servicing, N177.46 billion as sinking fund.

Others are N2.98 trillion for non-debt re-current expenditure, N2.24 trillion for capital expenditure including capital in statutory transfers.

Sectoral allocations of the budget show that in capital votes, Federal Ministry of Power, Works and Housing got the lion share of N529 billion, followed by Ministry of Transportation which has N262 billion, Ministry of Interior, N150 billion, Ministry of Defence N140 billion among others.

Specifically, the President remarked that in line with his administration’s commitment to an independent and efficient Judiciary, 2017 budgetary provisions for the third arm of government has been increased from N70 billion it was last year to N100billion.

Buhari added that aggregate revenue available to fund the federal budget is N4.94 trillion which is 28% higher than 2016 full year projections.

Oil, according to him, is projected to contribute N1.985 trillion of the N4.94trillion , while non oil revenues, largely comprising Companies Income Tax, Value Added Tax, Customs and Excise duties, and Federation Account levies are estimated to contribute N1.373 trillion.

“We have set a more realistic projection of N807.57 billion for Independent Revenues, while we have projected receipts of N565.1 billion from various Recoveries. Other revenue sources, including mining, amount to N210.9 billion”, he said.

President Buhari further told the lawmakers that the 2017 budget has a deficit plan of N2.36 trillion which is about 2.18% of GDP and to be financed mainly by borrowing, projected to be about N2.32 trillion.

“Our intention is to source N1.067 trillion or about 46% of this borrowing from external sources while, N1.254 trillion will be borrowed from the domestic market”, he explained.

But in the votes for recurrent expenditure, the Ministry of Interior has the largest allocation of N482.7billion, followed by the Ministry of Education which has N390billion, Defence N325billion, and Health N252billion etc.

Also, President Buhari assured Nigerians that his administration was determined to ensure a departure from dependence on imported goods to locally made products.

He promised to ensure a new era where Nigerians consumed locally made products, saying “for many years we depended on oil for foreign exchange revenues. In the days of high oil prices, we did not save, we squandered.

“We wasted our large foreign exchange reserves to import nearly everything we consume. Our food, our clothing, our manufacturing inputs, our fuel and much more. In the past 18 months when we experienced low oil prices, we saw our foreign exchange earnings cut by about 60 per cent.

“Also, our reserves eroded and our consumption declined as we could not import to meet our needs. By importing nearly everything, we provide jobs for young men and women in the countries that produce what we import, while our own young people wander around jobless.

“By preferring imported goods, we ensure steady jobs for the nationals of other countries while our own farmers, manufacturers, engineers and marketers remain jobless.”

“We will CHANGE our habits and we will CHANGE Nigeria,’’ he said.

Earlier in his earlier remarks, the Senate President Bukola Saraki, said budget estimates from the executive no matter how beautifully drafted, remains a proposal that can be tampered with by the legislature in line with constitutional provisions.

He added that whatever approval made by the legislature on the budgetary provisions, should be well implemented by the executive to arrest the hunger in the land.

And moving the vote of thanks, Speaker, House of Representatives, Hon. Yakubu Dogara, described as frustrating, the repeated experience of poor implementation of the nation’s annual budget.

According to him, “….an Appropriation Act must be allowed to run for an uninterrupted period of twelve months, for the Executive to have enough time to execute it. This means that both Mr. President and the National Assembly must find a way to continue the execution of the 2016 Budget, especially the capital component till May 6, 2017, which is twelve months from the date Mr. President signed the 2016 Appropriation Bill.”

He asked the President to be ‘creative’ in ensuring the workability of the budget to achieve the desired result, assuring that the federal legislature cannot and would not be an obstacle to proper budget implementation.

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