Ahead of presentation this Thursday, President Muhammadu Buhari has increased the total expenditure profile of the projected 2022 budget from N13.98trillion to N16.45trllion.
The increase in the projected budgetary proposals contained in the revised 2022- 2024 Medium Term Expenditure Framework (MTEF)/ Fiscal Strategy Paper (FSP) was forwarded to both chambers of the National Assembly for expeditious consideration.
Specifically, it also affected the earlier proposed N5.6trillion deficit which now rises to N6.2trillion.
While the margin of increase in the projected total expenditure profile is N2.47trillion, that of deficit in the proposed budget is N692billion.
As contained in the revised MTEF / FSP documents and separately read on the floor of both chambers, the increase in the total expenditure profile of the budget covers additional N100 billion provision made for the Independent National Electoral Commission (INEC) for conduct of the 2023 general elections and additional provision of N510 billion in the service wide votes to cater for National Poverty Reduction.
Others are additional capital provision of N1.70 trillion following projected increases in capital supplementation by N179.1billion, GOEs Capital by N222.1 billion and TETFUND expenditure by N290.7billion.
Others are Multi-lateral /Bi-lateral Project-tied Loans by N517.5 billion and MDAs Capital Expenditure by N390.5billion .
In the revised documents, President Buhari said “the aggregate deficit (inclusive of GOEs and Projected Loans), is projected to increase by N692billion or 3.4% of GDP from 3.05% of GDP.”
The request titled: “Submission of the Revised FGN 2022 – 2024 Fiscal Framework” reads: “It is with pleasure that I forward the Revised 2022-2024 Medium Term Fiscal Framework (MTEF) for the kind consideration and approval of the House of Representatives.
“The revision was necessitated by the need to reflect the new fiscal terms in the Petroleum Industry Act (PIA) 2021, as well as other critical expenditures in the 2022 Budget.
“The underlying drivers of the 2022 fiscal projections, such as oil price benchmark, oil production volume, exchange rate, GDP growth, and inflation rate reflect emergent realities and the macroeconomic outlook, and remain unchanged as in the previously approved 2022-24 MTEF&FSP.
“The PIA establishes a progressive fiscal framework aimed at encouraging investment in the Nigerian petroleum industry. This significantly alters the Oil and Gas fiscal terms and has necessitated changes in the 2022-2024 Medium Term Fiscal Framework.
“The fiscal effects of PIA implementation are assumed to kick in by mid-year 2022. The revised 2022-24 Fiscal Framework Is the premised on hybrid of January-June (based on current fiscal regime) and July-December (based on PIA fiscal regime), while 2023 and 2024 are now fully based on the PIA.
“Arising from this, and other critical expenditures that should be accommodated in 2022 Budget, the changes to the 2022 Projections in the Fiscal Framework are as follows:
“Federation Account Revenue: a. Gross revenue projection decreased by N341.57 billion, from N8.870 trillion to N8.528 trillion.
“b. Deductions for Federally-funded upstream project costs and 13% Derivation, decreased by N335.3 billion and N810.25 million respectively.
“c. Net Oil and Gas revenue projection declined by N5.42 billion from N6.540 trillion to N6.535 trillion.
“FGN Retained Revenue; a. A projected decline in Net Oil and Gas Revenue by N5.42 billion.
“b. An increase in projected FGN’s Retained Revenue from N8.36 trillion to N10.13 trillion (inclusive of GOEs), largely based on: i. A projected increase in the revenues of Government Owned Enterprises (GOEs) by N837.76 billion, iii. MDAs Internally Generated Revenue by N697.6 billion; iv. The introduction of Education Tax of N306 billion and Dividend of N8.3 billion from the Bank of Industry as revenue lines; and
v. FGN share of oil price royalty of N96.9 billion which ts expected to be transferred to the Nigerian Sovereign Investment Authority based on the provisions of the PIA”.
In treating it expeditiously, the request which came by way of presidential communication, ought to have been listed on the Senate’s Order Paper for Wednesday plenary for general debates by senators.
Rather, it was transmitted straight to the committee on finance for required scrutiny in just 24 hours.
In doing that, Senate Leader Yahaya Abdullahi (APC Kebbi North), immediately after Deputy President of the Senate Ovie Omo – Agege finished reading the request, informed the Senate that 2022 budget presentation would be made by President Buhari to joint session of the National Assembly Thursday this week .
“In view of the planned 2022 budget presentation to joint session of the National Assembly by President Muhammadu Buhari this Thursday, I move for suspension of our relevant rules for expeditious consideration of the revised 2022 – 2024 MTEF/ FSP documents .
“In doing this, I move that lead debate on the request should be skipped and that it should be transmitted to our committee on Finance for the required scrutiny for just 24 hours, which makes the committee’s report to be submitted on Wednesday in plenary to pave way for the Thursday budget presentation by the President .I so move,” he said.
Accordingly, in line with parliamentary practices and procedures, the leader’s motion was seconded by the Minority Leader and adopted by the Senate when put to voice votes.
