Naira steadies at N273 as labour lauds Buhari over proposed hiring of 500,000 teachers

THE Naira yesterday, remained steady at N273 to the dollar, after the Federal Government affirmed that its 2016 appropriations are expected to lead to N2.2 trillion.

However, naira futures trade, a derivative product used to hedge against future exchange rate moves, rose by over two percent against the currency from N256.75 it closed on Monday to N262, indicating that exchange rate would be pegged at level in 12 months.

The pressure on the futures trade of the naira was heightened as traders said the government’s plan to increase spending to make up for losses from falling oil prices was not sustainable.

Meanwhile, President Muhammadu Buhari, at the presentation of 2016 budget plan to the National Assembly yesterday, said the fiscal deficit is expected to reach N2.2 trillion naira ($11 billion) due to plans to tripling capital expenditure in comparison with 2015 budget.

Therefore, borrowings abroad will rise as much as N900 billion to fund part of the deficit, representing 2.16 percent of the country’s Gross Domestic Product, while N984 billion would be borrowed at home.
In a related development, the Nigeria Labour Congress (NLC) has lauded the Federal Government for its decision to engage 500,000 unemployed persons as teachers in the coming year.

Reacting to Buhari’s 2016 budget proposal, yesterday in Abuja during the emergency Central Working Committee (CWC) of the NLC, Congress President, Ayuba Wabba, said though the details still need close scrutiny, the proposed employment of teachers is a step in the right direction.

Wabba also said despite the renaming of fuel subsidy to mean price modulation by the Minister of State for Petroleum Resources, Dr Ibe Kachiwku, congress will resist any attempt at upward movement of petrol price in the new year.
Workers, he also said, would resist the new electricity tariff introduced by Nigeria Electricity Regulatory Commision (NERC).

“We applaud the move to recruit more teachers. This will reduce unemployment in the country but we are yet to study the details of the budget proposals.

The emergency CWC meeting also said it will reject any attempt by the government to increase the pump price of petrol by whatever name it is called. If petrol costs about N18 per liter in an oil producing country like Algeria, why should we be buying petrol at N87 per liter in Nigeria? Nigerians should benefit from the low price of oil in the international market. The long lasting solution is to refine our oil in the country. NLC will participate in any talk that is aimed at achieving such feat. It is possible for government to build new modular refineries within 18 months and this has been done by Niger Republic that is very close to us.”

Wabba also said NLC would mobilize against the new electricity tariffs introduced by NERC explaining that Nigerians are ready to pay for what they consume and that cancellation of strange bill is nothing new.

He called for the availability of pre-paid metre by the electricity companies.
While hinting of the plan to begin the process of reviewing the minimum wage, Wabba called for the resignation of any governor that is incapable of implementing the minimum wage.
He stressed that NLC state councils have been given the marching orders to ensure that state governments pay minimum wage.
Wabba, also berated the proposed return of toll gates by the Federal Government , saying the toll gates did not achieve the purpose they were meant for when they were in operation .

A civil society activist and Executive Director at OJA Development Consult, Abuja, Jide Ojo, said the the budget actually seeks to stimulate the economy, making it more competitive by focusing on infrastructural development; delivering inclusive growth; and prioritizing the welfare of Nigerians.

“The home-grown public primary school feeding and free education for science, technology and education students in our tertiary institutions is appealing. Federal Government’s plan to collaborate with states and local governments to tackle the ‘chronic shortage’ of teachers in public schools across the country by planning  to recruit, train and deploy 500,000 unemployed graduates and NCE holders to strengthen basic education, especially in rural areas is also laudable.”

“It is also commendable to note that this government will be encouraging a reduction in tax rates for smaller businesses as well as subsidised funding for priority sectors such as agriculture and solid minerals,” he said.

However, given the continuous fall in crude oil prices, he noted that$38 on which the budget is predicated has become grossly presumptuous as oil now sells for about $32 in international market.