As promised, the President presented the 2017 budget before the Senate today, Wednesday, the 14th of December.
Meanwhile the Minister of Budget and National Planning, Udoma Udoma has already said the sum of NGN 10 trillion was being targeted by the federal government as revenue for the 2017 fiscal year and that the government intends to issue new oil licenses as part of efforts to explore new streams of revenues to fund the 2017 budget.
The minister disclosed this when he appeared before the Senate joint committee on appropriation and finance to defend the revised Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP).
Today, however, President Buhari presented a budget proposal with a total sum of NGN 7.298 trillion for the 2017 fiscal year.
We kept our eyes peeled through the process and below are the things we learnt:
- No Nigerian pays attention to time schedules.
You have heard it before (“African time”); you’ve been irritated by it before; you have even worked with it at least once and now we know from this event that even the Number 1 citizen operates on African time.
The budget presentation had been scheduled for 10:00 am today was later reported to have been moved to 12:00 pm because the president was yet to return from his Banjul mission. Finally, the presentation started at about 2:00 pm with an opening prayer and then an apology for lateness.
2. Why the 2016 budget failed
The President explained that low crude prices and miscalculations account for the shortcomings of the 2016 budget. He explained that the budget was presented using a benchmark of NGN 197 to the Dollar.
Also, he Presidency says it is still in the process of collating and documenting the indebtedness left behind by past administrations to contractors and for now, the estimated sum amounts to about NGN 2 trillion.
3. The 2017 budget is the budget of “economic recovery”
Having acknowledged the shortfalls of the 2016 budget, the President assured that the priority of his government remains largely the same except that a few additions have been made to ensure restoration of the economy.
He added that the 2017 spending plan builds on our 2016 budget, provides a clear roadmap for the policy actions and sets the design to bring the economy out of recession, to acquire a steady growth and prosperity.
4. The new benchmark
The dollar is benchmarked at NGN 305 against the dollar in the new budget. The budget also sets a benchmark of $42.5 per barrel of oil, as against $38 in 2016.
5. We are still going to have to #BuyTheNaira to #GrowTheNaira in 2017
In simple terms, President Buhari insists on his importation bans. In fact, one of the first things he did was to make “special appeal to states to make land available to farmers”.
Meanwhile, the government reserves for itself the rights to the importation of funds by way of borrowing: NGN 2.32trillion -1.067 trillion from external sources and NGN 1.254 trillion will be borrowed from domestic sources.
NGN 100 billion goes to the judiciary as opposed to last year’s NGN 70 billion
NGN 1.66 trillion goes to debt servicing;
The President broke down capital expenditure as follows:
Defence – NGN 1540 billion;
Power, Works and Housing – NGN 529 billion;
Transportation – NGN 262 billion;
Special intervention programmes – NGN 150 billion;
Water resources gets NGN 85billion;
Industry, Trade and Investments – NGN 81 billion;
Interior ministry gets NGN 63ilion;
Education is allocated NGN 50 billion;
UBEC – NGN 92 billion;
Health – NGN 51 billion
The Federal Capital Territory gets NGN 37 billion;
The Niger-Delta Ministry gets NGN 33 billion;
NDDC – NGN 61 billion
The total of NGN 7.298 trillion makes for a nominal increase of 20.4% increase over the 2016 budget estimates.
7. Finally, through the benevolence of the Speaker of the House of Representatives, Yakubu Dogara, we are reminded that he, the President and the Senate President, Dr Bukola Saraki are all December babies.