President of the Senate, Ahmad Lawan yesterday announced the receipt of the Medium Term expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) from President Muhammadu Buhari.
In the document sighted by the Tribune Online, the federal government put its size of 2020 Budget at N9.12 trillion, about N2 billion higher than the N8.92 trillion of 2019 budget. The document projected $55 as a crude oil benchmark.
The document revealed the amount accruable to the Federation Account and Value Added Tax Pool Account projection at N7.68 trillion and N2.09 trillion, respectively in 2020.
“Of this, oil revenue contributes up to 66% of Federation Account receipts. Other components of the Federation Account revenue include revenue from Corporate Tax, N1.73 trillion, Customs Revenue 759.77, Special Levies N112.55 billion, Solid Minerals 3.91 billion and Actual Balances in Special Accounts N10.73 billion.”
The document gave the projected fiscal deficit at N1. 95 trillion, about N33.61 billion (or 1.8%) more than the estimate of N1.92 trillion in 2019. The Buhari administration, however, projected that “the aggregate fiscal deficit for 2020 will be N2.28 trillion, which is 1.59% of Gross Domestic Product, still within the 3% threshold.”
To finance the deficit, the All Progressive Congress-led administration revealed in the MTEF that ” the deficit will largely be financed by new borrowings estimated at N1.70 trillion while about N252.08 billion will be derived from privatisation proceeds and N328.13 billion are loans secured for specific development projects.”
ALSO READ: Mobile money agent allegedly raped co-worker to death in Ogun
Senator Lawan who read the letter addressed to him by President Buhari on the floor of the Red Chamber commended the efforts of lawmakers towards ensuring a cordial working relationship between the legislature and executive arms of government.
The letter reads: “It is with pleasure that I hereby submit the 2020-2022 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) to the Senate.
“Let me use this medium to express my gratitude for the much improved partnership between the legislative and the executive arms of the Federal government in our goal of making the budget process deliver better outcomes for the Nigerian people in particular.
“I note with further appreciation, the commitment and support that Distinguished Senators have continued to demonstrate. Pursuant to the provision of the fiscal responsibility Act 2007, the preparation towards the submission of the 2020 budget to the National Assembly is progressing well.
“The MTEF/FSP was prepared taking into account, key development of the global and domestic environments. We have endeavoured to ensure that forecasted revenues are realistic, but also reasonably challenging in the face of our significantly constrained fiscal space.
“Planned spending has been set at prudent and sustainable levels consistent with governments overall developmental objectives as set out in the Economic Recovery and Growth Plan (ERGP).
“Given our shared objective of returning the budget to a predictable January – December fiscal year, with effect from 2020, I hereby forward the 2020/2022 FSP to the Distinguished Senate and trust that it would be extensively considered in order to facilitate the 2020 MTEF budget preparation .”
and then