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Budget: FG to Release N350bn for Capital Projects

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  • Budget: FG to Release N350bn for Capital Projects

The Federal Government is set to release the first tranche of capital release of N350bn to its Ministries, Departments and Agencies for implementation of the 2017 budget.

The Minister of Finance, Mrs. Kemi Adeosun, disclosed this on Monday in Abuja during the public presentation of the 2017 Federal Government budget.

The event was attended by top officials in government, including the Minister of Budget and National Planning, Udo Udoma; Minister of State for Budget, Zainab Ahmed; Minister of Health, Prof. Isaac Adewole; and Minister of Foreign Affairs, Geoffrey Onyema, among others.

The 2017 budget christened, ‘Budget of Recovery and Growth’, was presented to the National Assembly on December 14, 2016, and passed by the lawmakers on May 11, 2017.

It was signed into law by the Acting President Yemi Osinbajo on June 12, 2017 and had a total expenditure outlay of N7.44tn, out of which N2.99tn was for non-debt recurrent spending; N2.36tn for capital expenditure; while debt servicing is to gulp N1.66tn.

Adeosun said her ministry was ready to make the release as soon as the budget was loaded, adding that a cash plan meeting would soon be held where the funds would be released to the MDAs.

“We are ready to make releases as soon as the budget is loaded. We have a cash plan meeting and we will release the first tranche of N350bn for capital projects,” she stated.

Udoma, in his presentation at the event, said the 2017 budget would run for one full year till June next year.

He, however, said that both the executive and the legislature were working on a template that would enable the country to commence a predictable budget year that would run between January and December of every year.

He added that if this arrangement was to commence from the 2018 budget year, then the 2017 budget would cease once the next year’s budget was passed and signed into law in January.

The implication of this, according him, is that some of the programmes of government contained in the 2017 fiscal document would be re-introduced in the 2018 budget.

Udoma explained, “The period of the 2016 budget was up till May and the period of the 2017 budget is again by the provision of the bill that was sent to us, which is now an Act of Parliament, continues again, this time, till June.

“However, whenever a new Appropriations Act comes into law, it overtakes the previous Appropriations Act. This means that assuming we were as we intend to achieve this year, we pass the 2018 budget into law; when it is signed into law, then the other one ceases to exist.

“So our aim is by January 2018, we want to get back to the January to December budget year. That means some of the projects in the 2017 budget will have to be carried over.”

He added that the budget that was passed by the National Assembly was what was signed into law by the Acting President, adding that an understanding had been reached for the submission of virement application to adjust the budget to reflect some of the projects, which the lawmakers tinkered with.

Such projects, according to him, are the railways, health and Federal Capital Territory projects.

Udoma said, “We identified some of our priority projects where the allocations have been reduced and discussed with the National Assembly and they graciously agreed that we can bring a virement application to restore the amount of those projects.

“Those projects include the railways, some health projects and Federal Capital Territory projects. But until that is done, the budget and the Appropriations Act reflect exactly what was passed by the National Assembly, and this is what the law is as I speak.

“However, we will be bringing virement application on a number of these projects under consideration. It’s only after they have approved it before it now becomes a law, and the budget will be adjusted to reflect that.”

The minister said the capital allocation of N2.36tn, which represents 31.7 per cent of the total budget, was directed at projects that were aligned with the core execution priorities of the Economic Recovery and Growth Plan.

Udoma noted that allocations had been targeted at critical economic sectors that had quick transformative potential such as infrastructure, agriculture, manufacturing, solid minerals, services, and social development.

For instance, he said the government would be embarking on a rail modernisation programme for which N148bn had been allocated mostly as counterpart funds on projects to be financed by China.

They are Lagos-Kano, Calabar-Lagos, Kano-Kaduna, Ajaokuta-Itakpe-Warri, Kaduna-Idu and other rail projects.

In the area of electricity, the minister said the sum of N40bn service-wide provision had been made to settle reconciled outstanding bills of government agencies as part of the strategy to revamp the ailing power sector.

For the housing sector, Udoma said the sum of N28bn was allocated in the budget for the Federal Government’s National Housing Programme nationwide.

He stated that the government was concerned about the number of abandoned projects scattered across the federation, adding that more targeted releases of funds would be done to relevant agencies of government.

The minister noted that in this year’s budget, funds had been allocated for construction and rehabilitation of over 65 roads and bridges across the six geo-political zones of the country.

Some of them are N10bn for the rehabilitation/reconstruction and expansion of Lagos-Shagamu-Ibadan dual carriageway sections I and II; N13.19bn for the dualisation of the Kano-Maiduguri road Sections I-V; N10.63bn for the rehabilitation of the Enugu-Port Harcourt dual carriageway Sections I-IV; and N7bn for the construction of the Second Niger Bridge phases 2A & 2B, including the access roads.

The Director-General, Budget Office of the Federation, Mr. Ben Akabueze, said the government would be engaging the citizens more in its budgeting process in order to enable the country to have a document that would be all inclusive.

He added that steps were being taken to bridge the gap between the people and the government by promoting transparency and accountability in the entire budget process.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

NNPC Supplies 1.44 Billion Litres of Petrol in January 2021

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The Nigerian National Petroleum Corporation (NNPC) supplied a total of 1.44 billion litres of Premium Motor Spirit popularly known as petrol in January 2021.

The corporation disclosed in its latest Monthly Financial and Operations Report (MFOR) for the month of January.

NNPC said the 1.44 billion litres translate to 46.30 million litres per day.

Also, a total of 223.55Billion Cubic Feet (BCF) of natural gas was produced in the month of January 2021, translating to an average daily production of 7,220.22 Million Standard Cubic Feet per Day (mmscfd).

The 223.55BCF gas production figure also represents a 4.79% increase over output in December 2020.

Also, the daily average natural gas supply to gas power plants increased by 2.38 percent to 836mmscfd, equivalent to power generation of 3,415MW.

For the period of January 2020 to January 2021, a total of 2,973.01BCF of gas was produced representing an average daily production of 7,585.78 mmscfd during the period.

Period-to-date Production from Joint Ventures (JVs), Production Sharing Contracts (PSCs) and Nigerian Petroleum Development Company (NPDC) contributed about 65.20%, 19.97 percent and 14.83 percent respectively to the total national gas production.

Out of the total gas output in January 2021, a total of 149.24BCF of gas was commercialized consisting of 44.29BCF and 104.95BCF for the domestic and export markets respectively.

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Economy

NNPC Says Pipeline Vandalism Decrease by 37.21 Percent in January 2021

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Gas-Pipeline

The Nigerian National Petroleum Corporation (NNPC) said vandalisation of pipelines across the country reduced by 37.21 percent in the month of January 2021.

This was disclosed in the January 2021 edition of the NNPC Monthly Financial and Operations Report (MFOR).

The report noted that 27 pipeline points were vandalised in January 2021, down from 43 points posted in December 2020.

It also stated that the Mosimi Area accounted for 74 percent of the total vandalised points in Janauray while Kaduna Area and Port Harcourt accounted for the remaining 22 percent and 4 percent respectively.

NNPC said it will continue to engage local communities and other stakeholders to reduce and eventually eliminate the pipeline vandalism menace.

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Economy

Nigeria’s Food Inflation Hits 22.95 Percent in March 2021

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Food inflation in Africa’s largest economy Nigeria rose by 22.95 percent in March 2021, the latest report from the National Bureau of Statistics (NBS) has shown.

Food Index increased at a faster pace when compared to 21.70 percent filed in February 2021.

Increases were recorded in Bread and cereals, Potatoes, yam and other tubers, Meat, Vegetable, Fish, Oils and fats and fruits.

On a monthly basis, the food sub-index grew by 1.90 percent in March 2021. An increase of 0.01 percent points from 1.89 percent recorded in February 2021.

Analysing a more stable inflation trend, the twelve-month ended March 2021, showed the food index averaged 17.93 percent in the last twelve months, representing an increase of 0.68 percent when compared to 17.25 percent recorded in February 2021.

Insecurities amid wide foreign exchange rates and several other bottlenecks that impeded free inflow of imported goods were responsible for the surged in prices of goods and services in March, according to the report.

The Central Bank of Nigeria-led monetary policy committee had attributed the increase in prices to scarcity created by the intermittent clash between herdsmen and farmers across the nation.

However, other factors like unclear economic policies, increased in electricity tariffs, duties, subsidy removal and weak fiscal buffer to moderate the negative effect of COVID-19 on the economy continue to weigh and drag on new investment and expansion of local production despite the Federal Government aggressive call for improvement in domestic production.

Nigeria’s headline inflation rose by 18.17 percent year-on-year in the month under review.

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