Nigeria President Muhammadu Buhari on Friday presented the 2023 budget estimates tagged, “Budget of Fiscal Stability and Transition” before the joint session of the National Assembly.
The Budget which is his administration’s last, is totaled at N20.15 trillion, an increase of N750 billion as against the N19.76 trillion projected in the 2023-2025 Medium Term Expenditure Framework and Fiscal Strategy Paper, already passed by both chambers of the National Assembly.
Based on the fiscal assumptions and parameters, total federally-collectible revenue is estimated at N16.87 trillion in 2023. Oil price benchmark was pegged at 70 US Dollars per barrel; with a daily oil production estimate of 1.69 million barrels (inclusive of Condensates of 300,000 to 400,000 barrels per day), exchange rate was pegged at 435.57 Naira per US Dollar; with projected GDP growth rate of 3.75 percent and 17.16 percent inflation rate.
The expenditure comprises of a statutory transfers of N744.11 billion, non-debt recurrent costs of N8.27 trillion, personnel costs of N4.99 trillion, pensions, gratuities and retirees benefits of N854.8 billion; overheads of N1.11 trillion; capital expenditure of N5.35 trillion, including the capital component of statutory transfers; debt service of N6.31 trillion; and sinking fund of N247.73 billion to retire certain maturing bonds.
Addressing the lawmakers, President Buhari disclosed that the sum of N470 billion intervention had been provided for in the 2023 budget estimates to fund tertiary institutions.
While urging varsity lecturers under the aegis of the Academic Staff Union of Universities (ASUU) to show understanding in government efforts to address the concerns, the President noted that Government alone cannot provide the resources required for funding tertiary education.
He nevertheless said the Federal Government would not sign any agreement that would be difficult to implement, with ASUU.
Speaking further, Buhari said that in line with the plan to accompany annual budgets with Finance Bills, partly to support the realization of fiscal projections, current tax and fiscal laws/regulations are being reviewed to produce a draft Finance Bill 2022.
With this, he assured that once ongoing consultations are completed, the Finance Bill 2022 would be submitted to the National Assembly to be considered alongside the 2023 Appropriation Bill.
The President also announced the discontinuation of the oil subsidy regime from next year.
He described the oil subsidy regime as grossly unsustainable in the current reality of low revenues occasioned by oil theft and insecurity.
Buhari said, “Total federally distributable revenue is estimated at 11.09 trillion Naira in 2023, while total revenue available to fund the 2023 Federal Budget is estimated at 9.73 trillion Naira. This includes the revenues of 63 Government-Owned Enterprises. Oil revenue is projected at 1.92 trillion Naira, Non-oil taxes are estimated at 2.43 trillion Naira, FGN Independent revenues are projected to be 2.21 trillion Naira. Other revenues total 762 billion Naira, while the retained revenues of the GOEs amount to N2.42 trillion Naira.
“The 2023 Appropriation Bill aims to maintain the focus of MDAs on the revenue side of the budget and greater attention to internal revenue generation. Sustenance of revenue diversification strategy would further increase the non-oil revenue share of total revenues. The Government notes with dismay the crisis that has paralysed activities in the public universities in the country. We expect the staff of these institutions to show a better appreciation of the current state of affairs in the country. In the determined effort to resolve the issue, we have provided a total of 470.0 billion in the 2023 budget from our constrained resources, for revitalization and salary enhancements in the tertiary institutions.
“In most countries, the cost of education is jointly shared between the government and the people, especially at the tertiary level. It is imperative therefore that we introduce a more sustainable model of funding tertiary education. The Government remains committed to the implementation of agreements reached with staff unions within available resources. This is why we have remained resolute that we will not sign any agreement that we would be unable to implement. Individual institutions would be encouraged to keep faith with any agreement reached in due course to ensure stability in the educational sector.”
In his welcome address, the President of the Senate, Ahmad Lawan proffered suggestions on how to reverse the increasing trend of deficits in the nation’s budget.
Lawan told President Buhari that the nation’s economy is still challenged by dearth of revenues, and the idea of deploying revenues from the Oil and Gas to support the diversification into real sectors like Agriculture, Manufacturing, Mining, etc. is now under serious threat.
According to him, oil thieves have declared war on the country and its people and if necessary measures are not taken to stop the thieves immediately, the economy will be devastated.
He advised that deficit can be reduced by stopping the theft, and also other options should be considered to source more revenues for government.
Lawan said, “The large scale and massive stealing of our Oil, is concerning, as this reduces drastically the revenues available to the Government. With conflicting figures, projections have put our losses from this malaise at between 700,000 to 900,000 barrels of crude Oil per day, leading to about 29 to 35 per cent loss in Oil revenue in the first quarter of 2022. This represents an estimated total fall from N1.1 trillion recorded in the last quarter of 2021 to N790 billion in the first quarter of this year.
“The situation has worsened. Recently, the loss of our Oil has reached 1 million barrels per day. Translated into monetary terms, our loss is monumental. The figures show we are not able to meet the OPEC daily quota of 1.8million barrels per day. Mr. President, I consider the Oil thieves the worst enemies of our country. The thieves have declared war on our Country and our people.
Speaking further, the Senate President suggested taking off some of the major revenue generating agencies from direct funding by placing them on cost of collection of revenues, as we did for Federal Inland Revenue Service (FIRS), Nigeria Customs Service.
In this regard, Lawan said agencies like Nigeria Ports Authority, (NPA), Nigeria Communications Commission, (NCC), Nigeria Maritime Administration and Safety Agency, (NIMASA), etc can be given encouraging cost of collections of revenues.
Lawan also called for the completion of the ongoing legacy projects of the Buhari government, adding that the menace of flooding in many parts of the country has been particularly worrisome and has devastated homes, and disrupted families, lives and livelihoods.
In his vote of thanks, the Speaker of the House of Representatives, Hon. Femi Gbajabiamila advocated stricter handling of the oil thieves considering the socio-economic damage they are foisting on Nigerians.
He said Nigerians no longer want to hear about crude oil theft, but what is being done to address the issue.
He described oil theft as a treasonable offence, calling for a swift and systemic overhaul of the systems in place to protect the country’s oil and gas resources.
The Speaker also handed down a warning to Ministries, Department and Agencies (MDAs) of government to adhere strictly to laws governing their accounting process as the consideration of the 2023 Budget estimates commences.
While commending President Buhari for the historic visit with an assurance to give the document the importance it requires, the Speaker implore the incoming Assembly to build on the novel and enduring reforms initiated by the 9th Assembly
His words: “Today’s presentation is historic because it is the last such presentation by President Muhammadu Buhari, GCFR. It is also the last time the 9th Assembly will convene to receive the President for this purpose. We are once more reminded of the finite nature of public service and the obligation to make the most of our time to deliver on our promises to the Nigerian people.
“It is often said that it is not how well you start but how strong you finish. We, intend here in the 9th assembly, to finish strong. I assure you the National Assembly will prioritise this bill and ensure it is passed before the end of the year, as is the practice in the 9th Assembly. However, we will not, in the quest for timely passage, fail to do the due diligence expected of us by the Nigerian people.”
Speaking to THISDAY, the House spokesman Hon. Benjamin Kalu, said the lawmakers will review all proposals made in the budget as it is different from the recommendations contained in the MTEF-FSP report which the lawmakers approved.
He warned all MDAs of federal government to ensure they are present for the budget defense as the lawmakers will not entertain any excuses.
“The Executive they are at will to present what they feel is good for the nation. It’s our duty to review what they submitted based on what we feel is good for the nation. Whatever they have presented, if it’s not in line with MTEF, we will look at it and if there needs for any adjustments that will be taken care of at committee level. We not today that MTEF is different from the budget, we will find out why and find a way to fix it. It’s not the final document. The oil price, the house projected $73 per barrel, executive projected at $70. We will prune here and thereto make sure that what comes will reflect realities that we can defend,” Kalu said.
Deji Elumoye, Sunday Aborisade and Udora Orizu in Abuja
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