By Christiana Ekpa and Umar Puma
President Muhammad Buhari has disclosed that all recovered loot and assets will be used to fund the N8.83trn 2019 budget.
The President who disclosed this during the formal laying of the N8.73 trillion budget proposal tagged ‘Budget of continuity’ before a joint session of the National Assembly, said his administration has set a revenue target of N6.97 trillion to fund the 2019 budget and it has resolved to partner private sector towards building a digital economy.
He also unveiled plans to inject a total sum of N160 billion to fund Small and Medium Scale Enterprises (MSMEs), recapitalization of Bank of Industry and Bank of Agriculture, Presidential Amnesty Programme as well as North East Development Commission (NEDC) in 2019.
According to him, the sums of N65 billion was proposed for implementation of Presidential Amnesty Programme; N45 billion as North East Intervention Fund; N10 billion as take-off grant for the North East Development Commission; N15 billion to support Small and Medium Scale Enterprises, which are the focus of our industrialisation drive; N15 billion for recapitalization of Bank for Agriculture and Bank of Industry as well as N10 billion as grant to Bank of Industry for the purpose of subsidizing the interest rates charged on loans to Small and Medium-Scale Enterprises with the view to make it possible for them to access single digit interest rate loans from the Bank of Industry.
Key assumptions in the 2019 budget proposal presented by Mr. President, Oil Production was put at 2.3 mbpd; Oil Price $60 barrel;9.98 percent inflation rate; N119.28 trillion nominal consumption; N139.65 trillion; N139.65 trillion as nominal GDP and 3.1 percent GDP rate for the year 2019.
He explained that the administration’s plan to include “N275.88 billion representing capital for the larger GOEs and N556.02 billion for Multi-lateral/Bi-lateral project-tied loans, the aggregate capital budget is N3.12 trillion. This represents 30 percent of the total FGN proposed expenditure for 2019.
“The allocation to the Social Intervention Projects (SIP) has been retained at N500 billion, consisting of N350 billion recurrent and N150 billion capital. This reflects our continued determination to pursue inclusive gender-sensitive and pro-poor growth,” Buhari said While giving breakdown of the sources of revenue, Buhari disclosed that the sum of N6.97 trillion (3 percent lower than the 2018 estimate of N7.17 trillion), consist of N3.73 trillion oil revenue while non-oil revenue is estimated at N1.39 trillion.
“We have allowed for N305 billion ($1 billion) for under-recovery by NNPC on PMS in 2019. We will continue working to bring it downwards so that such resources are freed up to meet the developmental needs of our people.
“Let me also take this opportunity to address and clarify the under-recoveries or subsidy on petrol. In a period of economic challenges where purchasing power is weak, we must reduce some of the burden on Nigerians. The problem with subsidies in the past is abuse and corruption. Today the government through the NNPC is the sole importer of PMS and therefore, the under-recovery is from the NNPCs trading account. This means the possibility of some marketers falsifying claims is removed.
“The estimate for non-oil revenue consists of N799.52 billion from Companies Income Tax (CIT), N229.34 billion from Value Added Tax (VAT) and Customs Duties of N302.55 billion. We have reduced our expectation from Independent Revenues to N624.58 billion. Other revenues expected in 2019 include various recoveries of N203.38 billion, N710 billion as proceeds from the restructuring of government’s equity in Joint Ventures and other sundry incomes of N104.11 billion.”
While reeling out the 2018 budget performance, Buhari disclosed that: “As at the end of the third quarter, Federal Government’s actual aggregate revenue was N2.84 trillion, which is 40 percent higher than 2017 revenue. The overall revenue performance is only 53 percent of the target in the 2018 budget largely because some one-off items are yet to be actualized. We have now rolled this revenue item over to 2019.
“Of the total appropriation of N9.12 trillion, N4.59 trillion had been spent by 30th September, 2018 against the prorated expenditure target of N6.84 trillion. This represents 67 percent performance. debt service and the implementation of non-debt recurrent expenditure, notably payment of workers’ salaries and pensions are on track.
Despite the delay in the passage of the 2018 Budget on 20th June 2018,the sum of N820.57 billion had been released for capital projects as at 14th December, 2018. We have carried over capital projects that were not likely to be fully funded by year-end 2018 to the 2019 budget.”
He observed that Nigeria has moved from a deficit to surplus in its trade balance, adding that: “as at the third quarter of 2018, the trade balance was a surplus of N681.27 billion representing a significant improvement from the deficit of N290.1 billion in 2016.
“This reflects the rebound in crude oil exports, increased non-oil exports and a reduction in the importation of food and items that can be produced locally. Foreign capital inflows including direct and portfolio investments also responded to improved economic management.
Capital importation to Nigeria in the third quarter of 2018 stood at $2.86 billion, which is a 56.7 percent increase compared to the corresponding period in 2016,” Buhari told the lawmakers.
He also assured Nigerians of the administration’s resolve to pay the new minimum wage and soon send a bill to the National Assembly.
The President noted that measures will be put in place to ensure that the implementation of the new minimum wage will hike borrowing, adding that a technical committee will be set up to advise the government on the implementation of the new wage, putting into consideration.
However, the President presented the budget under tight security within the National Assembly Despite the security arrangements, the lawmakers in their unusual manner turned the budget presentation into rowdy and blowing session.
Our correspondent reports that, parliamentary staff, the management of the institution took a plan B option of using the presidential gate of the National Assembly bordering the Supreme Court and the Villa to avoid any breaking down of law and orders.
The main gate of the complex opposite the federal secretariat as well as the entrance from the office of the Secretary to the Government of the Federation, SGF were all shut, as Journalists and, other people who had anything to do at the complex were subjected to rigorous security checks.
The checks continued around 10:30 am when they started making entry into chamber for the budget presentation that was billed for 11:am. At least, more than 5 persons including operatives from the Department of State Service, DSS, Police anti-bomb squad and the National Assembly security officials were stationed at the door to the gallery, armed with a list of all journalists.