Stories By Olu Balogun:
Out of aggregate expenditure of N8.612trillion proposed as 2018 budget by President Muhammadu Buhari before the joint session of the National Assembly last week, N2.014trillion is set aside for debt servicing aside N2.005trillion deficit in the budget to be financed by external borrowing and proceeds from privatized government establishments.
The N8.612 trillion 2018 budget profile is about 16% on the N7.44trillion 2017 budget.
Other highlights of the budget christened by the President as budget of consolidation are N3.494trillion earmarked for recurrent expenditure, N2.652trillion for capital expenditure, N456billion for statutory transfer.
The budgetary provisions, according to the President are based on key parameters such as $45 per barrel oil price benchmark, projected oil production of 2.3m barrels per day, exchange rate of N305 to a US dollar, Real GDP growth of 3.5 percent; and Inflation Rate of 12.4 percent.
President Buhari explained further that a total sum of N11.983 trillion is estimated to be the total collectible revenues for the federation in the fiscal year out of which the sum of N6.387 trillion is expected to be realised from oil and gas sources, while total receipts from the non-oil sector are projected at N 5.597 trillion .
Specifically, President Buhari in the budget presentation, stated that the total estimated revenue for the federal government in the projected N8.612 trillion 2018 budget is N6.607 trillion which according to him is about 30 percent more than the 2017 target.
“As we pursue our goal of revenue diversification, non-oil revenues will become a larger share of total revenues. In 2018, we project oil revenues of 2.442 trillion Naira, and non-oil as well as other revenues of N4.165 trillion.
“Non-oil and other revenue sources of 4.165 trillion Naira, include several items including: Share of Companies Income Tax (CIT) of 794.7 billion Naira, share of Value Added Tax (VAT) of 207.9 billion Naira, Customs & Excise Receipts of 324.9 billion Naira, FGN Independently Generated Revenues (IGR) of 847.9 billion Naira, FGN’s Share of Tax Amnesty Income of 87.8 billion Naira, and various recoveries of N512.4 billion, N710 billion as proceeds from the restructuring of government’s equity in Joint Ventures and other sundry incomes of N678.4 billion”, he explained.
He, however, lamented heavy revenue losses in the 2017 budget proposals which according to him, impacted very negatively on the budget implementation. According to him, N605.8billion projected as independent revenue for the budget, only N155.4billion was realized as at September this year indicating 74% shortfall.
The consolidation profile of the 2018 budget according to him is hinged on its projected capital expenditure which is 30.8% of the entire budget estimates.
He said: “To consolidate on the momentum of the 2017 Budget’s implementation, many ongoing capital projects have been provided for in the 2018 Budget. This is in line with our commitment to appropriately fund ongoing capital projects to completion.
“By allocating 30.8 percent of the 2018 Budget to capital expenditure, the Federal Government is also demonstrating its strong commitment to investing in critical infrastructure capable of spurring growth and creating jobs in the Nigerian economy”.
He added that key capital spending allocations in the 2018 Budget include: Power, Works and Housing: N555.88 billion; Transportation: N263.10 billion; Special Intervention Programmes: N150.00 billion; Defence: N145.00 billion; Agriculture and Rural Development N118.98 billion.
Others are Water Resources: N95.11 billion; Industry, Trade and Investment: N82.92 billion; Interior: N63.26 billion; Education N61.73 billion; Universal Basic Education Commission: N109.06 billion; Health: N71.11 billion; Federal Capital Territory: N40.30 billion.
The rest are, Zonal Intervention Projects N100.00 billion; North East Intervention Fund N45.00 billion; Niger Delta Ministry: N53.89 billion; and Niger Delta Development Commission: N71.20 billion etc.