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Senate benchmarks oil price at $57 per barrel for 2024 MTEF, FSP

By Adamu Abuh, Abuja
22 September 2021   |   1:43 pm
The Senate unanimously endorsed the 2022 -2024 medium-term expenditure framework and fiscal strategy paper (MTEF-FSP). The decision followed the adoption of the recommendations of Senator Solomon Olamilekan led joint committees on finance, National Planning and Economics Affairs, foreign and local debts, banking, insurance and other financial institutions, petroleum resources (upstream), downstream petroleum sector and gas…

The Senate unanimously endorsed the 2022 -2024 medium-term expenditure framework and fiscal strategy paper (MTEF-FSP).

The decision followed the adoption of the recommendations of Senator Solomon Olamilekan led joint committees on finance, National Planning and Economics Affairs, foreign and local debts, banking, insurance and other financial institutions, petroleum resources (upstream), downstream petroleum sector and gas at the plenary presided by the Senate President Ahmad Lawan.

The lawmakers approved the daily crude oil production of 1.88mbpd, 2.23mbpd, and 2.22mbpd for 2022, 2023 and 2024 respectively and the benchmark oil price of USD$57 per barrel.

The lawmakers also okayed the exchange rate of N410.15/US$, the projected GDP growth rate of 4.20% and the projected Inflation rate of 13.00% and the sustenance of the Fiscal deficit estimate of N5.62 trillion. (including GOEs).

Also approved were the projected New Borrowings of N4.89 trillion (including Foreign and Domestic Borrowing), the USD$3.5 billion International Monetary Fund (IMF) loan at the rate of 0.01% to 0.02%, FGN retained revenue of N8.36 trillion; total FGN proposed expenditure of N13.98 trillion; Fiscal deficit of N5.62 trillion (including GOEs); New Borrowings of N4.89 trillion (including Foreign and domestic Borrowing), subject to the provision of details of the borrowing plan to the National Assembly.

It includes Statutory transfers, totaling, N613.4 billion; Debt Service estimate of N3.12 trillion; Sinking Fund to the tune of N292 billion; Pension, Gratuities & Retirees Benefits of N567 billion; and Aggregate FGN Expenditure of N13.98 trillion; made up of Total Recurrent (Non-debt) of N6.21 trillion; Personnel Costs (MDAs) of N3.47 trillion; of Capital expenditure (exclusive of Transfers) N3.26 trillion; Special Intervention (Recurrent) amounting to N350 billion; and Special intervention (Capital) of N10billion.

Among the recommendation of the committees endorsed were that the Salaries and Wages Commission should review the salary structure of all the MDAs, in other to come up with a new salary structure for the MDAs that will reflect the true financial position of the Agencies.

*That there should be a continuous review of the Fiscal Responsibility Act to ensure that all revenues are remitted to the CRF as at when due, in order to curtail frivolous deductions and diversion of funds by the MDAs.

*That all laws relating to mining businesses should be reviewed as a matter of urgency to ensure upward review of rates applied to royalties, ground rent and licenses renewal of all mining companies operating in Nigeria to ensure transparency in the collection of revenue by the relevant agencies of the government and also look into the issues of illegal mining activities by recommending stringent sanctions in the proposed new laws.

*That the Nigeria Customs Service should accelerate the process of installing scanners at all Ports across the country to curb the issue of underpayment of customs duties on imported goods which has resulted in huge loss of revenue to the government and to further improve its activities at all borders across the country in order to curb the issues of smuggling across border areas.

*The urgent implementation of the Petroleum Industry Act (PIA) recently assented to by the President in order to curtail the problems of smuggling and round–tripping of petroleum products imported into the country.

*That the proposed budget of the Government Owned Enterprises (GOEs) should be reviewed upward to show the reflection of their capabilities to generate more revenue as a result of the findings of the Joint Committee.

*That the offices of the Accountant General (AGF), Auditor General of the Federation (AuGF) and Fiscal Responsibility Commission (FRC)be strengthened in the area of staffing and proper funding of its activities to ensure optimal performance of their duties in order to adequately monitor the remittances of all government revenues.

*That the Act establishing some MDAs be reviewed and amended as a matter of urgency to evidence a more nationalistic interest, as these amendments will assist to generate more revenue to the coffers of the government. For example; the Nigerian Investment Promotion Council (NIPC) Act, the National Lottery Trust Fund Act, Bank of Industry Act, Bank of Agriculture Act, the Energy Commission Act and Nigeria Nuclear Regulatory Commission ACT.

*That the Federal government budget be reviewed and be purged of some agencies that demonstrated capacity to stand on their own without any recourse to Federal Government of Nigeria Budget. For example; National Agency for Food and Drug Administration and Control (NAFDAC) and Nigerian College of Aviation Technology, Zaria (NCAT).