FEC approves Medium Term Expenditures Framework, proposes N6tr budget for 2016
The Federal Executive Council (FEC) has approved Medium Term Expenditures Framework (MTEF) with a proposal of N6 trillion budgets for 2016 to be approved by the National Assembly.
Minister for Budget and Regional Planning, Senator Udo Udoma, who made the disclosure at a media briefing on the outcome of the FEC meeting chaired by President Muhammadu Buhari, at the State House, Abuja on Monday, 7th December 2015 stated that the approved MTEF will in the next three years provide government’s policy direction.
“We are looking at an expansionist budget; we are looking at a budget that will be N1 trillion more than last year. So, we are looking at a budget of about N6 trillion. Last year’s budget, including the supplementary was about N 5 trillion,” he noted.
He said that 30% of the budget or N1.8 trillion would go into capital projects with a view to addressing the nation’s infrastructure deficit adding that the council was working on the projection of $38 per barrel crude oil price.
Udoma stated that though the Council considered the price to be very conservative, it had become necessary in lieu of uncertainties adding that the Council also projected 2.2 million barrels per day of oil production, which he said is achievable.
On sources of funding for the budget, “We will get the funding from two sources. We are looking at trying to increase our non-oil revenue, we are looking at trying to get more money from the various government agencies, policing their collection and trying to get more money from them. We will also look at keeping down our recurrent budget; that means we are looking at savings that we can make from overheads,” Udoma disclosed.
“We will look at the efficiencies from our revenue collecting agencies like the Federal Inland Revenue Service in terms of company income tax, in terms of VAT, and then the difference,” he added.
“We will have to borrow. But the level of borrowing that we anticipate and we are projecting will be well within the maximum that is allowed which is three percent of the GDP because we want a prudent budget, we want a credible budget,” he elucidated.
The Minister disclosed that the MTEF will be submitted to the National Assembly, with an expectation for a feedback to facilitate finalisation of the 2016 budget proposal that will present details of government’s intention that will be subsequently submitted to the lawmakers.
He disclosed that the government worked based on the exchange rate presented by the Central Bank of Nigeria.
On whether fuel subsidy would be retained, the minister simply said: “We are looking into that.”
On workers’ salaries Udoma stated that, “We are expecting some savings from the Integrated Personnel and Payroll Information System (IPPIS) which we are using. So, we are not cutting anybody’s salary. Everybody will get their salaries.”