PRESIDENT Muhammadu Buhari, on Tuesday, presented an estimated N8.6 trillion 2018 budget to a joint session of the National Assembly.
This was against a budget of N7.4 trillion appropriated for the 2017 fiscal year.
In the budget, the Power, Works and Housing Ministry, headed by Mr Babatunde Fashola, got N555.88 billion.
Also, the Ministry of Transportation, headed by Mr Rotimi Amaechi, got N263.10 billion.
The president, who presented the budget estimates at the chambers of the House of Representatives, said the “Budget of Consolidation,” has a principal objective of reinforcing and consolidating the recent accomplishments.
He said the 2018 budget would sustain the reflationary policies of the past two budgets, while giving the key parameters to include oil price benchmark of $45 per barrel; oil production estimate of 2.3 million barrels per day, including condensates; exchange rate of N305 to one dollars for 2018; real GDP growth of 3.5 per cent and inflation rate of 12.4 per cent.
The president also said the federally collectible revenue for the year was expected to peak at N11.983 trillion, indicating that the different tiers of government would have some 12 per cent revenue more than the 2017 estimates.
According to him, of the said amount, the sum of N6.387 trillion was expected to be realised from oil and gas sources, while the total receipts from non-oil sector was projected at N5.597 trillion.
While giving a further breakdown of the budget, the president stated that the proposed recurrent expenditure would stand at N3.5 trillion; capital expenditure would amount to N2.4 trillion; N2 trillion would be committed to debt servicing, while statutory transfers would account for N456 billion.
He also said that N220 billion would go for sinking fund (to retire maturing bond to local contractors).
According to the president, “N456.46 billion was provided in the 2018 budget for statutory transfers,” adding that the five per cent increase over last year’s provision was mainly due to increases in transfer to Niger Delta Development Commission (NDDC) and the Universal Basic Education Commission (UBEC), which are related directly to the size of oil revenue.
On debt restructuring, the president said: “we are closely monitoring our debt service to revenue ratio. We shall address this ratio through our non-oil revenue-generation drive and restructuring of the existing debt portfolio.
“Presently, domestic debt accounts for about 79 per cent of the total debt. Our medium-term strategy is to reduce the proportion of our domestic debt to 60 per cent by the end of 2019 and increase external debt to 40 per cent. It is noteworthy that rebalancing our debt portfolio will enhance private sector access to domestic credit,” he said.
On recurrent expenditure, the president disclosed that “a substantial part of the recurrent cost proposal for 2018 is for the payment of salaries and overheads in key ministries providing critical public services such as: N510.87 billion for interior; N435.01 billion for education; N422.43 billion for defence and N269.34 billion for health”.
On personnel costs, Buhari said, “it is projected to rise by 12 per cent in 2018. Although we have made substantial savings by registering MDAs on the Integrated Personnel Payroll Information System (IPPIS) platform, the increase is mainly due to provision for staff promotion arrears and recruitments by the military, police and para-military agencies.
“Furthermore, I have directed that agencies are not to embark on any fresh recruitment unless they have obtained all the requisite approvals. Any breach of this directive will be severely sanctioned.”
According to him, the overhead cost was projected to rise by N26 billion in 2018, a modest increase of about 12 per cent reflecting inflationary adjustments.
On capital expenditure, the president maintained that “to consolidate on the momentum of the 2017 budget’s implementation, many ongoing capital projects had been provided for in the 2018 budget.
He said by allocating 30.8 per cent of the 2018 budget to capital expenditure, the Federal Government was demonstrating its commitment to investing in critical infrastructure, which, he said, was capable of spurring growth and creating jobs in the economy.
Saraki seeks focus on tax collection
Senate President, Dr Bukola Saraki, has urged the Federal Government to critically focus on the revenue from taxes as well as independent revenues from state-owned enterprises if the 2018 budget is going to be properly funded.
“We cannot afford to turn a blind eye to revenue under-performance,” he said.
Saraki, in the speech he delivered before the presentation of the 2018 Appropriation Act, canvassed for the review of extant laws guiding the operation of some government enterprises, adding that “I would urge for more determined effort on the part of the executive to plug leakages.”
According to him, “this sector alone accounts for over N40 trillion in valuation, of which less than N400 billion is remitted as revenue to the Consolidated Federation Account. This is not acceptable. We need to vigorously address this area.”
He called on the managers of parastatal agencies to submit their budget, as stipulated by the constitution.
On recession, he said that many businesses were adversely affected as many lost their means of livelihood, adding that “as the country emerges from that period of uncertainty, the question on the lips of many Nigerians has been this: How does the recovery translate into tangible economic benefits for me? We must remember that the real gains must be felt on a personal level by the individual, for economic recovery to have meaning.”
Saraki called on the government to continue to create the enabling environment for private sector businesses to thrive through its policies and spending priorities.
He also said the current rate of rural-urban migration was alarming and unsustainable, congesting the cities and stretching resources to breaking point, while undermining the economic viability of some states.
Dogara harps on budget implementation
While speaking at the session, Speaker of the House of Representatives, Honourable Yakubu Dogara, expressed displeasure over executive/legislature relationship, saying that the development was affecting the progress of work in nation building.
The Speaker, however, commended members of the Senate and House for their “patriotism and sense of national purpose in providing the peaceful enabling environment for Mr President to deliver his budget address.
According to him, “the success of this event separates us as true leaders who in the midst of a hazy executive-legislative relationship elected not to turn on ourselves but to turn to each other in the very interest of our constituents and national progress.
“This is the way we must go as our constitutional order is organised in a way that deliberately denies any of the three arms the strength to go at it alone on any national issue.
“Where that has happened, its progress that suffers. That reminds us of the adage that says, ‘If you want to go fast, go alone but if you want to go far, go together’.
“Examples abound on how fast but not far the executive has gone on some national issues where they have decided to go alone. There is no national challenge we cannot overcome if we work together,” he stated.
He congratulated President Buhari for honouring the provisions of the 2016 Appropriation Act which required the budget to last for 12 months in line with the provisions of Section 318 of the Constitution, from May 2016 when it was assented to, to May 2017.
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