BUDGET 2017: Tension among ministers as Presidency reads riot act

The query raised by the National Assembly over the poor handling of the projected expenditure of the 2017 budget has created tension among members of the executive arm of government.

The query has set off a number of chain reactions within the executive, especially among ministers and staff of the ministries of Finance, Budget Office and Petroleum Resources.

Ripples Nigeria gathered that there had been exchanges of memos among the ministers and heads of departments since Wednesday, following a directive by the Presidency to all officials involved in the budget data collation.

The memos called for a revisit of the issues raised by the Senate before the December 1 deadline for formal presentation of the detailed budget by the President to the National Assembly.

The upper legislature, in their plenary session last Monday insisted that the executive replace the document forwarded to the National Assembly, containing the 2017-2019 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP), with factually-backed paper, or else no further debate would hold on the 2017 budget proposal.

It will be recalled that since October when President Muhamadu Buhari forwarded the budget documents to the law makers, criticisms have been trailing it.

The main point of disagreement is on bench-marking crude oil price at $42.5 per barrel and a production output of 2.2 million barrels per day (bpd), as well as pegging the exchange rate at N297 to the dollar, which officially goes for N315 per dollar.

Read also: Why 2017 budget may be worse than 2016

Experts have argued that given the instability in the oil market, which has seen a fluctuation in the price of Brent oil hovering around $40.5 to $43.8 per barrel; it amounts to being over ambitious for the 2017 budget to be based on selling oil at $42.5, as contained in the MTEF and FSP document.

They also faulted the exchange rate projection as being speculative given the reality that dollar scarcity still persists in the country.

But in apparent admission of the error on the speculative oil price in the international market, the Minister of State, Petroleum Resources, Ibe Kachukwu, was quoted by foreign media as saying that the uncertainty hovering around the sector was informed by uncertainty surrounding the outcome of the much expected OPEC November 30 meeting in Algeria.

He conceded that there might be a review of the oil price benchmark as contained in the budget before Nigeria’s National Assembly.

“There is the need to tread cautiously on the issue since the outcome of OPEC resolution on production quotas to members is still being expected to turn out positive.

“If this fails to materialize, the price of crude will fall blow expectation of all,” Kachukwu said.
By Emma Eke….

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