N20.5tn budget: Buhari’s borrowing plan, subsidy faulted by NACCIMA, LCCI, other experts

The President, Major General Muhammadu Buhari (retd.), on Friday, laid the 2023 Appropriation Bill before a joint session of the National Assembly. The bill was tagged, ‘Budget of Fiscal Sustainability and Transition.’
However, the key provisions in the proposed N20.51tn budget have attracted reactions from major stakeholders, including the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture, Lagos Chamber of Commerce and Industry, economists and lawmakers, among others.
Of the N20.51tn budget, statutory transfers amount to N744.11bn; non-debt recurrent costs, N8.27tn; personnel costs, N4.99tn; pensions, gratuities and retirees’ benefits, N854.8bn; overheads, N1.11tn; capital expenditure, N5.35tn, including the capital component of statutory transfers; debt service, N6.31tn; and sinking fund of N247.73bn to retire certain maturing bonds.

In his presentation, Buhari said, “We expect total fiscal operations of the Federal Government to result in a deficit of N10.78tn. This represents 4.78 per cent of estimated GDP, above the three per cent threshold set by the Fiscal Responsibility Act 2007. As envisaged by the law, we need to exceed this threshold considering the need to continue to tackle the existential security challenges facing the country.

“We plan to finance the deficit mainly by new borrowings totalling N8.80tn: N206.18bn from privatisation proceeds and N1.77tn draw-downs on bilateral/multilateral loans secured for specific development projects/programmes.”
Buhari also slammed committees of the National Assembly for allegedly bypassing him and approving budgets for government-owned enterprises without his approval.

He said, “Distinguished Senators, honourable members, you may recall that we earlier integrated the budget of government-owned enterprises into the FGN’s 2019 budget submission. This has helped to enhance the comprehensiveness and transparency of the FGN budget. It has, however, come to my attention that government-owned enterprises liaise directly with relevant NASS committees to have their budget passed and issued to them directly.

“I would like to implore the leadership of the National Assembly to ensure that the budget I lay here today, which includes those of the GOEs, be returned to the Presidency when passed. The current practice where some committees of the National Assembly purport to pass budgets for the GOEs, which are at variance with the budgets sanctioned by me, and communicate such directly to the MDAs, is against the rules and needs to stop.”

Buhari also announced N470bn in intervention fund for the revitalisation and salary enhancement of higher institutions. He, however, pointed out that the government would not sign any agreement with unions in the sector that it did not have the capacity to implement.

He said, “The government notes with dismay, the crisis that has paralysed activities in the public universities in the country. We expect the (members of) 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 N470bn in the 2023 budget from our constrained resources, for revitalisation and salary enhancements in the tertiary institutions.
“It is instructive to note that today the government alone cannot provide the resources required for funding tertiary education. 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.”

GOGAN TV