SAN FRANCISCO, October 29, (THEWILL) – Key government agencies have re-echoed the position of the Coordinating Minister of the Economy and the Minister Finance, Dr. Ngozi Okonjo-Iweala, on the state of the economy that Nigeria is not broke.
Director-General, Budget Office of the Federation, Dr. Bright Okogu; Accountant-General of the Federation, Mr. Jonah Otunla and a deputy governor in the Central Bank of Nigeria (CBN), Mrs. Sara Omotunde Alade, all stated this in response to a query by the National Assembly Joint Committees on Finance.
These were the major highlights of the joint finance committee’s interactive meeting on the 2014-2016 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) .
“Nigeria is not broke. We may have cash flow problems from time to time but that does not translate to Nigeria being broke,” Okogu stated.
He cited countries like Greece and Spain which had recently sought bail-outs, saying “We (Nigeria) are no where near that situation.”
On his part, the AGF said “We have cash flow problem but the country is not broke, “adding “The DG Budget Office has said that and I strongly affirm that. ”
The CBN deputy governor, Alade, said: “We are bankers to the government. There is money in the account. The relevant agencies have said we are not broke and we (CBN) agree with them.”
Meanwhile, the committee members in wide ranging contributions at the meeting queried the executive amongst others on “discretionary waivers”, the crude oil benchmark and the contentious “envelope system” adopted for government Ministries, Departments and Agencies (MDAs) – all key components of the 2014-2016 MTEF/FSP.
It could be recalled that the 2014-2016 MTEF/FSP pegged crude oil benchmark for the coming 2014 budget at $74 per barrel.
For debt service, the 2014-2016 MTEF/FSP submitted by President Goodluck Jonathan earmarked N663.6 billion and N48 billion was earmarked for domestic and foreign debt service, totaling N712 billion.
Under the “Federally Collectible Revenue” category, the Federal Government is projecting to earn N10,519 trillion for 2014. A breakdown projection is as follows: Gross oil revenue (N6,814 trillion), Gross non-oil revenue (N3,288 trillion), non-federation account levies for targeted expenditure (N250.0 billion), education tax (N156 billion) and National Information Technology Development Fund (N9.390 billion).
The oil benchmark price of $75 per barrel for the 2013-2015 fiscal year elicited intense horse trading between the executive and the National Assembly. At the end, $79 per barrel oil benchmark was later agreed for the 2013 budget.
The 2014-2016 MTEF/FSP signaled increasing threat to Nigeria’s crude oil revenue from emerging competitors – global and regional – vis-a-vis dwindling demand for Nigeria’s crude oil, chiefly by the US.
Jonathan, in his letter dated September 12 to the Senate President, David Mark, said the planning documents were prepared against the backdrop of global economic uncertainty.
