Buhari presents N7.298 trn 2017 budget

PRESIDENT Muhammadu Buhari, on Wednesday, presented the N7.2 trillion 2017 budget to a joint session of the National Assembly, describing it as “Budget of Economic Recovery and Growth Strategy.”

He said the budget would build on the 2016 budget, adding that the budget amounted to a 20.4 per cent of the 2016 budget.

The president said the budget would have a 30 per cent aggregate capital expenditure profile, in line with the determination of the government to reflate the economy and pull it out of recession.

The budget is predicated on a crude oil benchmark of $42.5, daily oil production of 2.2million barrels per day and exchange rate of N305 to a US dollar.

Breakdown of the budget proposals as submitted by the president shows that N419.02 billion was earmarked for statutory transfers, N1.66 trillion for debt servicing, N177.46 billion as sinking fund.

Other parameters included in the budget were an expenditure of  N2.98 trillion for non-debt recurrent expenditure and N2.24 trillion for capital expenditure, including capital in statutory transfers.

The president stated that the aggregate revenue available to fund the federal budget stood at N4.94 trillion, which  he said was 28 per cent higher than 2016 full projections.

He also said that oil was projected to contribute N1.985 trillion of the N4.94 trillion, while non-oil receipts, including Companies Income Tax, Value  Added Tax, Customs and Excise duties, and Federation Account levies were estimated to contribute N1.373 trillion.

He said: “We have set a more realistic projection of N807.57 billion for Independent Revenues, while we have projected receipts of N565.1 billion from various recoveries. Other revenue sources, including mining, amount to N210.9 billion.”

He also told the senators that the 2017 budget had a deficit plan of  N2.36 trillion, which he said was about 2.18 per cent of the Gross Domestic Product (GDP).

He added that: “Our intention is to source N1.067 trillion or about 46 per cent of this borrowing  from external sources, while N1.254 trillion will be borrowed from the domestic market.”

Sectoral allocation of the budget indicates that the Federal Ministry of Power, Works and Housing got the lion share of the capital votes with an allocation of  N529 billion. This is followed by Ministry of Transportation, which has N262 billion; Ministry of Interior, N150 billion and the Ministry of Defence, N140 billion.

Other recurrent expenditure includes the Ministry of Interior, which has the largest allocation of N482.7 billion. The Ministry of Education, N390billion; Defence has N325 billion, while Health Ministry has N252 billion.

President Buhari said his administration was committed to tackling militancy in the Niger Delta, adding that all efforts would be made to ensure restiveness in the area was brought to its barest minimum to ensure stability in oil production.

He said: “Though we cannot control the price of crude oil, we are determined to get our production back to at least 2.2 million barrels per day. Consistent with the views which have also been expressed by the National Assembly, we will continue our engagement with the communities in the Niger Delta to ensure that there is minimum disruption to oil production. The National Assembly, state and local governments, traditional rulers, civil society organisations and oil companies must also do their part in this engagement. We must all come together to ensure peace reigns in the Niger Delta.”

He also stated his desire for an independent and efficient Judiciary, adding that from 2017 budgetary allocation to the tier of government would increase.

In line with that statement, the president announced that the budget of the sector had been increased from N70 billion it was last year to N100 billion.

He also said that the government had taken note of the submissions on how to take the country out of recession submitted by the National Assembly, adding that many of the points raised coincided with his views on the economy.

He added that the government was already incorporating them into the 2017 budgetary procedure, adding that the government would soon send some legislations to the parliament for considerations.

To ensure efficiency in the oil sector, he said that  from January 2017, the Federal Government would no longer make provision for joint venture cash-calls, adding that all joint venture operations would be subjected to a new funding mechanism that would allow Cost Recovery.