By MARK ITSIBOR, MBAKAAN KWEN and Kauthar Khaleel, Abuja
In a bid to expedite action on the implementation of the 2017 budget, the federal government disclosed yesterday that it was set to release the sum of N350 billion in the first tranche of funds for the execution of capital projects.
Minister of Finance, Mrs. Kemi Adeosun, who made the disclosure in Abuja at the public presentation of the 2017 appropriation Act said part of the money will be used to fund other government initiatives scheduled for the fiscal year.
According to the minister, the aim is to immediately commence execution of key projects of the government.
“We are ready, we are having a cash-plan meeting very soon and after that, N350 billion will be released as first tranche of capital releases for the 2017 budget”, she said, while addressing stakeholders who attended the public presentation.
Also speaking, the Minister of Budget and National Planning, Sen. Udoma Udo Udoma, said funding of projects would now be on Project-Based Release System to curb waste of public funds by Ministries, Departments and Agencies (MDAs).
He noted that part of the requirement for capital releases was evidence of compliance with the Bureau of Public Procurement Act.
Udoma said henceforth, no MDA is authorised to enter into a foreign denominated contract without the approval of the ministers of Budget and National Planning, and Finance.
Udoma also added that the federal government would strengthen its monitoring and evaluation framework to improve physical inspection and impact assessment of projects and programmes implemented by MDAs.
His words: “We are worried and concerned about the number of abandoned capital projects scattered in their thousands throughout the country, which we inherited from previous administrations. We know that you can’t continue doing things the same way and expect different result.
“So, we have to do things differently. We need to have more targeted releases. We have to look at the projects that are important and can easily be completed. The ministers are working together to ensure that over time, we concentrate our resources on completing important projects, so that we have maximum impact”.
Udoma also said that the Ministry was working with the National Assembly to get the country’s fiscal year adjusted to between January and December.
He explained that this could only be achieved when the executive and legislature work together to ensure that the budget is submitted, passed and signed before December 31, 2017.
Udoma also hinted that the federal government will use a fraction of the looted funds recovered so far to finance part of the 2017 budget.
He said the total revenue projected was N5.08 trillion, with 11 per cent coming from the recoveries made.
“On recoveries, we are being extremely conservative; what is in the budget is what we know about already. So if more comes, we will use it. Know that recoveries of looted funds are not the most dependable way to finance the budget because of the legal processes that have to be concluded before it can be spent. So, the money quoted in the budget is the one we have already recovered and is in our pocket to spend as we wish”, he stated.
He said the total revenue projected exceeded the 2016 projection by 30.26 per cent, adding that oil revenue projection was put at 41.7 per cent compared to 19 per cent in 2016.
Udoma added that the high revenue expectation from oil was driven by Joint Venture Calls (JVC) cost reduction, higher production and price, exchange rate as well as additional oil-related revenues.
According to him, Company Income Tax (CIT) will contribute 15.9 per cent, Value Added Tax (VAT) 4.8 per cent, Independent Revenue 15.9 per cent and others 5.2 per cent.
He also said the projected budget deficit which stood at N2.36 trillion remained relatively low at 2.18 per cent of the Gross Domestic Product (GDP).
The minister continued: “This is within the 3 per cent threshold stipulated in the Fiscal Responsibility Act (FRA). The budget is to be financed mainly by borrowings which have been projected at N2.32 trillion.
“Of this amount, N1.07 trillion is intended to be sourced externally, while N1.25 trillion will be sourced domestically.’’
Udoma stated that N35 billion is expected as revenue from the outright sale of government property and privatisation of state-owned enterprises.
He said to generate the projected revenue, the Federal Inland Revenue Service (FIRS) and Customs had been challenged to improve their efficiency and broaden their reach to achieve the set targets in the 2017 budget.
He said the federal government will strive to maximise the revenues it could generate from the oil and gas sector because the foreign exchange generated from the sector was critical for plans to diversify to the non-oil sectors.
“It is important that we use what we have to get what we need and want and what we have is oil. It is important that we make sure there is peace in the Niger Delta so that we can achieve the maximum from that resource”, he said.
In his remarks, the director-general of Budget Office of the Federation, Mr Ben Akabueze, said the office had introduced a new system known as Citizen Portal.
According to him, the portal which can be found on the budget office’s website provides the masses insights into the 2017 budget in a non-technical way.
“It is important for citizens to understand the budget, especially its key deliverables and their role in its implementation. When citizens do not fully understand the budget, it significantly limits their ability to engage with the budget process and hold government accountable for the prudent management of financial resources entrusted to it”, he said.
The N7.44 trillion budget was signed into law by the Acting President, Prof. Yemi Osinbajo, on June 12, a month after it was passed by the National Assembly.
…To spend N10bn on 65 roads
Meanwhile, the federal government has set aside N10 billion for the construction and rehabilitation of over 65 roads and bridges to enhance transportation system in the country.
Minister of Budget and National Planning, Sen. Udoma Udo Udoma, who gave the hint also disclosed that one of the focuses of the administration was to ensure good roads across the country.
He said the amount was earmarked for the rehabilitation of Lagos/Ibadan road, N13.1 billion for Kano/Maiduguri road and N10.63 billion for Enugu/Port- Harcourt road.
He said, “We have N7 billion for the second Niger Bridge which connects the East with the rest of the country on that side because it connects not just from Delta but all the way to Lagos.
“N7.12 billion for Abuja/Abaji/Lokoja road, N9.25 billion for the Obajana junction to Benin road, N7.5 billion for the Onitsha/Enugu dual carriage way and N7 billion for the construction of the Bodo/Boni road.
“Let me say something about the Bodo/Boni road, it is again one of the things that this government is doing, we are tapping private sector partnership for infrastructure. This is a partnership between the federal government and the LNG company and we want to make sure that the road can be completed quickly”.
The minister added that N3.3 billion was earmarked for the rehabilitation of the Ilorin/Jaba road, N3.5 billion for the dualisation of Odukpaleitu and N1.5 billion for the dualisation of the Kano/Katsina road.
He said N2.24 billion was allotted for the dualisation of Suleja/Minna road, N2.3 billion for Gombe/Numan/Yola road and N2.7 billion for Kano/Western by-pass, among others.
Udoma stressed that the government was committed to giving special attention to road development to ensure effective movement in the country.
He said, “Nigerians must be able to move around, goods and services must be able to move around; you cannot talk about industrialisation unless you can move goods and services around. So, that is important and that is why we have voted so much to roads and transportation”.
Udoma said funds had been allotted for the construction of the terminal building at Enugu Airport, rehabilitation of Abuja Airport and the inland ports and supply of cargo hanging equipment at Baro.
On healthcare, the minister said, “We have voted N4.8 billion for the global fund and GAVI counterpart funding, while N4.8 billion for polio eradication initiative. And I did say that water is life. So, we have over a hundred billion naira for water supply, rehabilitation of dams and irrigation projects nationwide.
“We have N6.5 billion for rural roads and water sanitation and N4.13 billion for guaranteed minimum price payment. Rural roads are important because our farmers are in rural areas and a lot of their produce is wasted because of the difficulty of evacuation, access roads will be provided to the farmers.
“We have earmarked about N20 billion for the promotion and development of value chain across the different commodities and we are doing them item by item. We look at each of them and sit down with the farmers, with the financiers, with the marketers and with the processers”.
On the various challenges in the agricultural sector, Udoma said the government was making effort to resolve them by acting on the challenges.
No insertions, Reps insist
Meanwhile, the House of Representatives has insisted that no insertions were made in the 2017 budget by the legislature.
Speaking on the controversy over the budget, the deputy minority whip of the House, Hon. Binta Bello, posited that based on its constitutional powers, the House only redistributed projects in the 2017 budget.
Bello also explained that what the parliament does with budget proposal from the executive is to redistribute to priority areas, given the lawmakers’ knowledge of the needs of the electorate as well as their proximity to the grassroots.
The deputy minority whip clarified that in the 2017 budget, the envelopes proposed for Ministries, Departments and Agencies (MDAs) were redistributed to more important projects within the same MDAs, adding that the projects were distributed with those envelops.
He said, “Despite the fact that they (executive) have identified some little changes that does not mean it was the National Assembly that inserted them, all the items were taken care of within the envelopes.
“We feel that other works are more important than the others. So, there are some little transfers, not to members or Senate but still within the MDAs that brought the budget. So, there’s nothing like inserting anything”
FG Tasks FIRS, Customs On Revenue Target
Meanwhile, the federal government has charged revenue generating agencies, particularly the FIRS and Customs to double up their efforts in achieving the target set for them in the 2017 budget.
The Minister of Budget and National Planning Senator Udoma Udo Udoma made the call yesterday in Abuja during the 2017 budget presentation.
According to him, this will aid in the implementation of the budget in terms of revenue generation.
He said, “In terms of implementation of the budget, we are making strenuous efforts to find the resources required. We are challenging our revenue generating agencies, particularly the FIRS and Customs, to improve their efficiencies and broaden their reach so as to achieve the targets set for them in the 2017 Budget.
“Most importantly, we will strive to maximize the revenues we can generate from the oil and gas sector as it is clear that the foreign exchange generated from the sector is critical for our plans to diversify to the non-oil sectors”.
The budget is based on the ERGP Implementation Plan which will guide the implementation of the 2017 budget as well as other budgets over the medium term.