By Olusegun Lawrence President Muhammadu Buhari Tuesday presented N6.08 trillion 2016 budget before a Joint Session of the National Assembly, apologizing to Nigerians over the persistent fuel scarcity across the country.
While assuring that the lingering fuel scarcity would soon end, the President stressed that the pump price remains N87 per litre.
According to Buhari, “The current fuel scarcity with long queues at petrol stations all over the country causing social dislocation is very unfortunate. Government profoundly apologizes to Nigerians for this prolonged hardship and misery.
“It is as a result of market speculators and resistance to change by some stakeholders. Government is working very hard to end these shortages and bring fuel to the pumps all over the country.”
The proposal shows that 30 per cent of the 2016 budget is for capital expenditure, increasing it from N557 billion to N1.8 trillion.
He justified the oil price benchmark of $53 per barrel but assured that the future looks bright as focus would be on the non-oil sectors to raise the government’s revenue profile.
Buhari stated further, “The Budget was based on a benchmark oil price of $53 per barrel, oil production of 2.28 million barrels per day and an exchange rate of N190 to the US$.
“The projected revenue was N3.45 trillion, with an outlay of N4.49 trillion, implying a deficit of N1.04 trillion. Due largely to under-provisioning by the previous administration for fuel subsidy and the costs required to support the military operations in the North East, the Government had to obtain National Assembly’s approval for a supplementary budget of N575.5 billion. I take this opportunity to thank all members of the National Assembly for the prompt passage of that Bill.
“To deliver our development objectives, we have increased the capital expenditure portion of the budget from N557 billion in the 2015 budget to N1.8 trillion, in the 2016 budget. Distinguished and honourable members of the National Assembly, for the first time in many years, capital expenditure will represent 30 per cent of our total budget. In future years, we intend to raise the percentage allocation for capital expenditure.
“This is a fulfillment of our promise to align expenditure to our long-term objectives, and a sign of government’s commitment to sustainable development. This increased capital expenditure commits significant resources to critical sectors such as Works, Power and Housing – N433.4 billion; Transport – N202 billion; Special Intervention Programs – N200 billion; Defence – N134.6 billion; and Interior – N145.3 billion. These investments in infrastructure and security are meant to support our reforms in the Agriculture, Solid Minerals and other core job creating sectors of our economy.
“We will invest to safeguard lives and property. We will invest in equipping our farmers with the right tools, technology and techniques. We will invest in empowering and enabling our miners to operate in a safe, secure and humane environment. We will invest in training our youths, through the revival of our technical and vocational institutions, to ensure they are competent enough to seize the opportunities that will arise from this economic revival.
“Indeed, the future looks bright. And I ask that we all work together to make this vision a reality. The 223 per cent year on year growth in capital expenditure demonstrates our desire to make Nigeria more competitive, and start the journey to deliver sustainable development in our country.
“In fulfillment of our promise to run a lean government, we have proposed a nine per cent reduction in non-debt recurrent expenditure, from N2.59 trillion in the 2015 Budget to N2.35 trillion in 2016. Furthermore, we have budgeted N300 billion for Special Intervention Programmes, which takes the total amount for non-debt recurrent expenditure to N2.65 trillion.
To deliver on his promises, he said there is a projection to borrow N1.9 trillion with N900 billion to be sourced from foreign and N986 billion locally.
However, he assured that “Our 2016 borrowings will be principally directed to fund our capital projects. Furthermore, the sum of N113 billion will be set aside for a Sinking Fund towards the retirement of maturing loans; while N1.36 trillion has been provided for foreign and domestic debt service. This calls for prudent management on our part, both of the debt portfolios and the deployment of our hard earned foreign exchange earnings.”
The sectoral allocations show Education receiving the highest recurrent vote of N369 billion; followed by Health, N296 billion; Defence, N294 billion; Ministry of Interior, N245 billion while the merged ministries of Power, Works and Housing received budgetary allocation of N433 billion for 2016.
The All Progressives Congress, APC National Chairman, John Odigie- Oyegun and key ministers including Rotimi Amaechi, Transport; Chris Ngige, Labour; Senator Udoma Udo Udoma, Budget nad national Planning; Dr. Kayode Fayemi, Solid Minerals; Dr. Emmanuel Ibe Kachikwu, Petroleum; Abubakar Malami, SAN, Attorney General and Mrs Kemi Adeosun, Finance among others accompanied President Buhari to the National Assembly.
The Senate has however, amended the Appropriation Act of 2015 to extend implementation of 2015 budget from December 31, 2015 to March 31, 2016.
