ERGP, others at risk of under-funding, says minister
• Nigeria needs $3tr to tackle infrastructure deficit
• Fayemi, W’Bank urge improved revenue to check poverty
• Govs oppose N162m monthly loan repayment plan
The Minister of Finance and National Planning, Zainab Ahmed, yesterday raised the fears that the Economic Recovery and Growth and Plan (ERGP) and other developmental programmes were at the risk of being under-funded owing to the economic realties in the country.
Speaking through a director in the ministry, Dr. Israel Igwe, at the Nigeria Governors Forum (NGF) peer review in Abuja, the minister noted: “Regarding the 2019 Budget, as at June 30, the actual aggregate revenue as per our fiscal accounts was N2.04 trillion, indicating a revenue shortfall of 42 per cent (due) to underperformance of both oil and non-oil revenue targets. Similar revenue shortfalls have been experienced since 2017 when the ERGP was launched, resulting in serious deviations from our targeted revenue and expenditure projections.”
She added that Nigeria needs $3 trillion over the next 30 years to address its infrastructure deficit.
To achieve positive results and sustainability, Ahmed stated that the nation must prioritise fiscal buoyancy in revenue generation internally.
The minister went on: “We currently have a pervasive revenue generation problem that must change to successfully finance our development plans.
“Speaking to the facts, our current revenue to GDP of eight per cent is sub-optimal and a comparison of oil revenue to oil GDP and non-oil revenue to non-oil GDP performance reveals the significant area that requires immediate and dire intervention as the non-oil sector.”
Ahmed said the performance attests to the country’s inability to efficiently collect taxes from its non-oil economic activities.
She observed: “Nigeria, when compared with (its) peers, is lagging (behind) on most revenue streams, including VAT and excise revenues as we not only by far have one of the lowest VAT rates in the world, but also weak collection efficiencies.”
Earlier in his welcome address, the NGF Chairman and Governor of Ekiti State, Kayode Fayemi, charged commissioners for finance to expand their revenue base for provision of quality healthcare, education, infrastructure and social safety nets to the citizens by the state chief executives.
Also speaking, World Bank Director, Shubham Chaudhuri, who decried the low level of revenue mobilisation in the country, said raising the GDP would lift Nigerians out of poverty.
He urged government at all levels to rigorously invest in human and infrastructure development, regretting that the huge funds needed for the venture were currently lacking in the most populous black nation.
Meanwhile, the 36 governors have opposed the plan by the Federal Government to extend the repayment period of its budget support to states from 20 to 30 years.
This comes as government said the monthly repayment had reduced from N252 million to N162 million based on the extension.
Minister of Finance, Budget and National Planning, Zainab Ahmed, made this known while briefing State House correspondents at the end of the National Economic Council (NEC) meeting chaired yesterday by Vice President Yemi Osinbajo in Abuja, said the state chief executives were not satisfied with the repayment extension and plan.