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2017 BUDGET: FG explores alternate avenues of funding
In a bid to get the country out of the economic recession, the Federal Government, has marshaled out plans to explore new streams of incomes to fund the 2017 budget.
Minister of Budget and National Planning, Udoma Udo Udoma, made this known when he appeared before a joint committee of the Senate on Appropriation and Finance, to defend the revised Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP).
He said the Federal Government will issue new oil licences, review the current joint venture arrangements with oil companies, review marginal oil fields and mount pressure on revenue generating agencies to surpass expected targets.
In a bid to get the country out of the economic recession, the Federal Government, has marshaled out plans to explore new streams of incomes to fund the 2017 budget.
Minister of Budget and National Planning, Udoma Udo Udoma, made this known when he appeared before a joint committee of the Senate on Appropriation and Finance, to defend the revised Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP).
He said the Federal Government will issue new oil licences, review the current joint venture arrangements with oil companies, review marginal oil fields and mount pressure on revenue generating agencies to surpass expected targets.
In a bid to get the country out of the economic recession, the Federal Government, has marshaled out plans to explore new streams of incomes to fund the 2017 budget.
Minister of Budget and National Planning, Udoma Udo Udoma, made this known when he appeared before a joint committee of the Senate on Appropriation and Finance, to defend the revised Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP).
He said the Federal Government will issue new oil licences, review the current joint venture arrangements with oil companies, review marginal oil fields and mount pressure on revenue generating agencies to surpass expected targets.
In a similar vein, the Federal Government has stated that the 2017 budget oil benchmark will be pegged at $42.50. This is a departure from $38 per barrel which was used for the 2016 budget.
The daily oil production volume for 2017 was retained at 2.2 million barrel per day (bpd). The exchange rate was put at $305 to a naira. The new exchange rate is significantly higher than that of 2016. The 2016 budget exchange rate was pegged at $197 to a naira.
Udoma said a total of N10 trillion is being targeted by the Federal Government as revenue during the 2017 fiscal year. Out of this amount, about N5 trillion is expected to be generated from the sale of crude oil.
Non-oil revenues will rake in about N5.06 trillion. These revenues are expected to come from corporate and company taxes, Nigeria Liquefied Natural Gas, Stamp Duties, capital gains tax, value added tax, Customs, excise, fees, surcharges on luxury items, special levies and Federal Government independent revenue.
The 2017 budget which was initially pegged at N6.69 trillion, has also been revised upward to N7.30 trillion. In 2016, the Federal Government submitted an ambitious N6.059 proposal to the National Assembly.
Out of this, the Federal Government is expected to expend N1.488 trillion in servicing domestic debts. In 2016 budget, the Federal Government earmarked N1.307 trillion.
On foreign debt, the Federal Government will spend N175.882 billion. It spent N54.480 on foreign debt servicing in the 2016 budget.
On capital expenditures, the Federal Government budgeted N2.058 trillion. In the 2016 budget, N1.587 was earmarked by the Federal Government for capital projects.
Read also: Sen Melaye mocks Buhari govt over NNPC’s withheld $5.6bn
Recurrent expenditures will gulp N1.866 trillion. About N1.748 was budgeted for the same purpose in the 2016 Appropriation. The new figure is coming, despite claims by the Federal Government that thousands of ghost workers have been yanked off from government’s payroll.
The Federal Government also intends to borrow a total of N2.321 trillion. Out of this, N1.253 will be sourced locally, while N1.067 will be gotten from foreign sources. In the 2016 budget, N1.182 was reportedly borrowed locally, while N635.8 billion was gotten through foreign borrowing.
Speaking further on the budget projections, Udoma said: “I know N7 trillion seems larger than N6 trillion. In actual dollar term, the 2017 budget is smaller. We have had challenges in revenue generation in funding the 2016 budget. We are trying to get to the bottom of revenue generating agencies in order to raise more money.
“On independent revenue, we need to work with the National Assembly. The issue of 80 per cent of operating surplus is a problem. We need to work with the National Assembly to review certain clauses of the law. We need to be more imaginative and creative in order to get out of the problem we have with revenue generating agencies.
“We want to issue a presidential order to ensure that revenue generating agencies are unable to spend money unless payment of salaries until their budgets are passed.
“We want to be more engaging in the Niger Delta to ensure that there is peace in order for us to produce. We will be increasing the amount for the Amnesty Programme to the old figure. It is important to engage the people in the Niger Delta region.”
President Muhammadu Buhari is expected to present the 2017 budget proposal on Wednesday, before a joint session of the National Assembly.
Unlike in the past, the budget submission will go ahead, despite the non-passage of MTEF and FSP by the Senate.
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