FG spends 35% of 2016 budget in 2 months
Over 34.6percent, that is about N2.1 trillion, of the 2016 budget has so far been expended since May, when the federal government began implementation of the budget.
Minister of Budget and National Planning, Mr. Udoma Udo-Udoma, disclosed that approximately N2.1 trillion of the N6.06 trillion approved budget for the year 2016 has been released and spent, while only N253 billion of the N1.8 trillion earmarked for capital projects had been spent.
Udoma made the revelation last week, at a stakeholders’ consultative forum with civil society groups and the organised private sector on the 2017-2019 Medium Term Expenditure Framework.
The minister, while assuring participants of the willingness of President Muhammadu Buhari’s administration to ensure transparency and timely commencement of the budgetary process, said government is already working at ensuring early submission of the 2017 budget to the national assembly to effect prompt consideration and approval.
According to the minister, the 2017-2019 MTEF should be ready and submitted to the National Assembly for consideration by October.
He also said; “Demand and supply factors are expected to keep crude oil prices low in the medium term compared to the period prior to mid-2014. We are considering a conservative oil price benchmark of 42.5 dollar per barrel for 2017, 45 dollar per barrel in 2018 and 50 dollar per barrel in 2019.
“We estimate oil production to be 2.2 million barrel per day for 2017, 2.3 million barrel per day in 2018 and 2.4 million barrel per day for 2019. We have pegged exchange rate for 2017, 2018 and 2019 at N290 to a dollar.”
Though the minister was silent on the projected total expenditure for the 2017-2019 MTEF, he said revenue projections are on the positive side as, “A significant increase in non-oil revenue receipts is projected due to a gradually recovering domestic economy and government’s expected improvement in FIRS tax collection efforts.
“Company Income Tax is projected to increase from N1.79 trillion in 2016 to over N1.86 trillion in 2017 and beyond.
“VAT collections to increase by about 42.4 percent 2017. Operating surpluses projection have been moderated downwards for 2017 and thereafter a modest growth.” he said.
Udo-Udoma said that recoveries of misappropriated and looted funds would also form part of their anticipated revenue for the years to come.
Citing examples from the mistakes in past budgeting process, the Lead Director, Centre for Social Justice, Mr Eze Onyepere, advice government to learn and build on the mistakes of the 2016 budget.
“We should draw lessons from the mistakes of the last budget. We have all seen that the revenue projections for 2016 were over optimistic. This is why we are finding it difficult to get money to fund the budget especially the capital expenditure.
“In 2017 onwards, we should be more empirical in our revenue forecast. Let it be more realistic so that there won’t be a deviation of more than minus or plus five percent.
“This is because if we have more money, we can do supplementary budgets rather than have an overly optimistic revenue projections and at the end of the day we are not able to fund our budget,” he said.