2022 budget: Reps decry indiscriminate devaluation of naira

• support $65 oil benchmark to reduce N6.45trn borrowing plan • call for upward review of N134bn statutory transfer for NASS • Intervention funds fail to address unemployment

Concerned members of the House of Representatives on Thursday expressed grave concerns over the indiscriminate devaluation of naira and inefficiency in the policy of the privatization of the power sector during the debate on the general principles of the 2022 Appropriations bill which scaled through Second Reading.

Speaking during the debate on the general principles of the 2022 budget estimates tagged ‘Budget of economic growth & sustainability, Chairman, House Committee on House Services, Hon. Olawale Raji tasked President Muhammadu Buhari with the need to prioritize critical infrastructural projects and ensure completion before the end of this administration.

“Mr President also spoke about the progress being made on several power generation, transmission and distribution projects. While this is commendable, I urge the Committee on Power to work with the Transmission Company of Nigeria (TCN) to ensure speedy completion of the Omotosho-Epe-Ajah power project which commenced in 2012 and has remained uncompleted 9 years after the award of the contract.

“While lamenting the poor performance of oil revenue relative to the budget, Mr President attributed the poor performance largely to the shortfall in production as well as significant cost recovery by NNPC to cover the shortfall between its cost of importing petrol and the pump price.

“The freedom presently enjoyed by NNPC to determine the cost of importing petrol and deducting same from the country’s oil revenue account has been a source of concern to Nigerians. I recommend that this should be scrutinized to avoid revenue leakages.

“Finally, Mr Speaker, the 2022 budget is on an exchange rate of N410.15 per US Dollar. This is a clear official devaluation of the Naira. This is bound to further impoverish Nigerians. Nigeria is an import dependent economy and the devaluation of our currency over the years has not benefitted our people in any way.

“It has led to high rate of inflation, drastic reduction in the purchasing power of the citizens, increased cost of doing business, corruption and brain drain, particularly among our highly skilled professionals. Rather than this continued devaluation of our currency, I recommend that efforts should be geared towards strengthening the Naira,” Hon. Raji noted.

While expressing optimism that the timely presentation of the 2022 budget will enable the Parliament to keep to its promise of the passage of the national budget before the end of every year, Hon. Raji applauded Federal Government’s giant stride recorded in infrastructural development particularly in the rail transportation sector; completion of the Lagos-Ibadan, Abuja-Kaduna and the ltakpe-Ajaokuta rail lines; and plans to connect Calabar-Lagos coastal line to Southern and Eastern States of the country.

On his part, Chairman, House Committee on Media and Public Affairs, Hon. Benjamin Kalu who decried the N134 billion proposed allocation to National Assembly also called for an increase in the oil benchmark from $55 per barrel to $65 in the 2022 fiscal year.

While calling for an overhaul of power reform, he frowned at the efficiency of the privatisation policy. “My advice is that this particular budget should incorporate the impact of climate change on our environment. Currently, this power sector that we’ve done privatization, they are not doing enough.

“Also the Oil benchmark of $57 per barrel, I’m advising that we push it between $63 and $65 so that we can achieve more for the nation.

“I’m also concerned about the daily production of crude which is at 1.88 million per day, though we might agree that’s the way it is supposed to remember that 300 to 400 million is incandescent and NNPC needs to sit up. Sit up in the sense that, the issue of data, our consumption rate that is being mentioned at 160 million per day is not logical. Nigeria consumption at the moment we’ve been made to understand its 60 million litres per day.

“Finally this concerns the House, because the statutory transfer, there’s an increase from 484.49 billion and that’s a reflection of 58 percent increase, and increase of 283.79 billion, do you know that this increase does not reflect on the amount that comes to National Assembly, but remember when there was a lower budget aggregate, it was reduced from N150 billion to N128 billion.

“Though we have challenges of our forex and our purchasing power of our currency, why are we remaining on N134 billion. Do you know what N134 billion represent when compared to the percentage of Statutory Transfers.

“In 2019, we had 125 billion given to National Assembly, that’s 1.42 percent of the N8.3 trillion, in 2020 we had N128 billion and that was a reduction from 1.42 percent in 2021 we are given N134 billion to National Assembly which now represents 0.98 percent, for 2022 we are getting N134 billion again which represents 0.82 percent, it ought not to be so,” he noted.

Also speaking, Chairman, House Committee on Rules and Business, Hon. Hassan Fulata also called for an upward review of the oil benchmark from $57 to $65 and reduce the proposed borrowing.

On his part, Hon. Ben Mzondu (PDP-Benue), called for the restructuring of the budget with a view to addressing the issue of unemployment.

“In 2020, Nigeria appropriated about N4.9 trillion for recurrent, in 2021 N5.6 trillion was appropriated, in 2022; N6.8 trillion has been appropriated. If we look at this progression, it has been on the upward trend whereas among the several MDAs there’s an embargo on employment and we must make deliberate efforts to see that this budget address the issue of unemployment in the country.

“As we speak today, a lot of interventions that we budgeted for are handled by CBN, NIRSAL loans and other interventions have not been able to address the issue of unemployment.

“It goes to say that this House must make deliberate efforts to look at this issue. Today the CBN is either a Bank of Industry or Bank of Agriculture. It’s no longer the banker’s bank.

“CBN is now doing what Education should be doing, what Agric should be doing etc. We must streamline this and become disciplined in our budget process. Particularly as it relates to recurrent expenditures, most of the MDAs if you take a look at their budget you don’t see employment but the budget has remained stagnant. They mostly talk about promotion, leaves, etc. We must be disciplined enough to make sure government cuts a lot of excesses in our recurrent.”

In his remarks, Hon. Ben Roland Igbakpa (PDP-Delta) who support the proposal for $65 oil benchmark also advocated for the merger of Ministries of Science and Technology and the Ministry of Communication and Digital Economy for effective service delivery.

“There’s a need for us not to allow the Excess Crude Account to grow once again. This is one account that never comes to Parliament and that account is always there to take funds, they don’t use it to pay our debt. So I support my colleagues that said we should jerk up the oil benchmark to $65 per barrel.

“We have issues with the youths, which makes up about 80 million Nigerians and we have a ministry called the ministry of science and technology and another one called the ministry of communication and digital economy, we have not seen any impact from these two ministries since their existence. We have raw talents all over the country, you see young men developing cars, drones and none of them is being harnessed by these ministries.

“For digital economy, all I know is the fact that they want to collect my data, same data which are being collected by the banks. I recommend that both Ministries should be brought together and merged into one so that we can reduce the cost of governance. Because this recurrent expenditure we are talking about are because of all these Ministries that are doing almost the same thing,” he urged.

After the debate, the Deputy Speaker, Hon. Idris Wase referred the Appropriation bill to the joint Committees on Appropriations, Finance, Aids, Loans and Debt Management and other relevant committees for further legislative action.

To this end, the House adjourned plenary till November 9, 2021, to enable various standing Committees to interface with heads of MDAs to enable them to defend their budget estimates.


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