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Reps Pass 2020 Budget for Second Reading

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By Orkula Shaagee, Abuja

The House of Representatives yesterday passed the 2020 budget for second reading.
President Muhammadu Buhari on Tuesday presented a spending plan of N10.3 trillion to the National Assembly, making next year’s proposed budget the country’s highest ever.


Members of the green chamber had on Wednesday commenced debate on the general principles of the appropriations act.

The proposal shows that about a quarter of the sum (N2.5 trillion) will be used for debt servicing, while capital expenditure is expected to gulp N2.1 trillion which excludes the capital component of statutory transfers.
A further breakdown presented by the president shows the expenditure estimate includes statutory transfers of N556.
7 billion, non-debt recurrent expenditure of N4.8 trillion and provision for Sinking Fund to retire maturing bonds issued to local contractors is N296 billion.
The budget was prepared on the assumption of $57 per barrel with crude oil production of 2.18 million barrels per day and the exchange rate assumed at N305 to $1, as well as real GDP growth of 2.93 per cent while “inflation is expected to remain slightly above single digits in 2020.”
On the first day of deliberations, Kingsley Chinda (PDP, Rivers) raised a point of order stating that it was improper for the budget to be attended to without its breakdown.
“The budget is very very ‘unripe’ for hearing.
“The minister yet to provide us with the full details that will enable this budget to be ripe for hearing,” he said.
But the Speaker then ruled Chinda out of order, stating that the house does not need full details to debate on general principles.
“What the president laid yesterday was actually in line with our constitution.”
At the resumption of debate yesterday, the Deputy Minority Leader, Toby Okechukwu (PDP, Enugu), said he commended the fact “that this is one of the time that budget is brought in early.”
“The capital expenditure has been reduced from 2019, the debt servicing of 2.8trillion,” he said. “There is no country that can make progress with this. Health budget is (N)48 billion. How can we make progress? This time, we are putting the cart before the horse,” he said.
“Nigerians are burdened with so much tax, I believe the budget will not work. I believe the money bill should have been brought before this.
“I was House committee chairman for works, I stated that the commitment of the Ministry is N4 trillion of contract awarded. Any belief that the country will move forward with this budget is a mirage.”
Also speaking on the matter, Nnaji Nnoli, (PDP, Enugu) said he was concerned about the aviation sector.
“Out airports are our gateway, I believe our airport should be given attention, I do not believe that our aviation is getting enough.
“I believe that if we can consolidate the 25 per cent of FAAN IGR to the federal government, that will help the airports.
“We can have a 10 years plan for the funds to be used by FAAN. We can develop our airport,” he stated.
House spokesperson, Benjamin Kalu can(APC, Abia) said he is in support of the bill “but that it will not be right without speaking on the timing of the budget”.
“It helps the private sector to plan, as they know the direction the policy is going, I commend them, but we cannot discuss 2020 without discussing 2019.
“One of the man things is the digitisation of tax collection. Over the years, it has been difficult to meet our tax target, the current budget is proposing a new tax burden.
“What this does to an emerging economy is that activities are reduced which causes unemployment and low productivity, which is like a cycle that will continue unless there is a paradigm shift,” he noted.
“The business environment… will it allow things to take place? It is important to copy from Rwanda. It is the first country that has started the manufacturing of smartphones from scratch.
“I commend the government for the shift to the non-oil sector,” he added.

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Economy

Value Addition is new Standard in Mining Operations – Alake

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The Minister of Solid Minerals Development, Dr Dele Alake has declared value addition as the new indispensable standard for mining operations in the country.

Alake made the declaration in a statement issued by his Special Assistant on Media, Mr Segun Tomori, on Tuesday in Abuja.

The minister had earlier said that the federal government had resolved to ensure compliance to value addition before permitting investors to operate.

He said that his seven-point agenda for the ministry had placed the mining sector on the global front burner since assuming office, which had generated renewed interest from the international community in Nigeria`s mineral resources.

According to the statement, the minister lauded a mining company, African Natural Resources and Mines Ltd.

(ANRML), during an inspection tour in Kaduna State, for its 600 million dollar facility dedicated to the mining and processing of magnetite iron-ore.

He described the move as in line with the government`s resolve for value addition, which is especially apt given President Bola Tinubu`s quest to develop the solid minerals, to boost Nigeria`s economic profile and to meet the global upsurge in energy transition.

“The company aligns with our vision of value addition and beneficiation through its processing of iron-ore, and I urge other mining companies to take a cue from them, “ he said.

He reiterated the government`s commitment to abstain from granting mining licenses to companies that lack the necessary plans for value addition.

The minister acknowledged that resilience, courage and laying a solid foundation were critical in contributing to the company success.

He added that such factors also serve as guidelines for President Tinubu`s administration in its efforts for economic transformation.

“ We have set our minds in this administration and invariably in Nigeria to achieve success, that is why Mr President is restructuring the economy.

“When this company (ANRML) started seven years ago, we saw one of the foundations through the video documentary, the amount of concrete that went in to erect a foundation, just to carry a giant edifice.

“That is what we are going through. When we get through the gestation period, the results will manifest, and it will herald prosperity, “he said.

The minister had stated that no license would be granted to companies wishing to enter the mineral sector without presenting a plan for value addition, such as processing and refining which has multiplier effect on the economy. (NAN)

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Economy

Life Insurance Records 95% Net Claims in Q4 2023-NAICOM

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The National Insurance Commission (NAICOM) says Life insurance business recorded about 95 per cent net claims of the total claims in the fourth quarter of 2023.

A report by NAICOM in Abuja on Tuesday hinted that the record was due to the direct reflection of the ongoing regulatory measures by the Commission regarding claims settlements.

NAICOM said the insurance market average stood at about 71.

4 per cent of the N536.
5 billion gross claims reported at the close of the fourth quarter.

The Commission said the market also recorded retention of about 87.7 per cent for the life business, 54 per cent for non-life while the aggregate market average retention stood at 66.

7 per cent for the period.

It showed that the insurance industry sustained its progressive trend of positive market performance at the close of 2023 fourth quarter.

According to NAICOM, the insurance market recorded a milestone growth to close at N1.003 trillion, representing about 27 per cent growth compared to the N790 billion recorded in 2022.

”Major growth drivers in the non-life segment of the market were oil and gas and fire Insurances contributing 27.3 per cent and 24.1 per cent respectively.

”In a direct reflection to the “no-premium no-cover” policy of the Commission, the outstanding premium continues to decline.

”The premium posted 1.6 per cent as outstanding of all the premiums generated in the market during the period.

”Statistics also shows that the market recorded total assets of about N2.67trillion and capitalisation of N851billion in 2023,” NAICOM said. (NAN)

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Economy

No Mining License without Mineral Value Addition Plans-Alake Warns

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The Minister of Solid Minerals Development, Dr Dele Alake has warned that no mining license would be issued to prospective investors without requisite plans for value addition on minerals.

Alake gave the warning in a statement  by his Special Assistant on Media, Segun Tomori on Tuesday.

He said the Federal Government had resolved to ensure compliance before permitting investors to operate.

He said that his Seven -Point Agenda for the ministry had placed the mining sector on global front burner since assuming office, which had generated renewed interest from the international community in Nigeria’s mineral resources.

He said the support of the executive and the legislature had enabled the ministry to showcase the solid minerals sector globally, resulting in his election as the Chairman of the Africa Minerals Strategy Group (AMSG) at the Future Minerals Forum in Riyadh, Saudi Arabia.

According to him, with the pact that led to the formation of the AMSG, there is now unity of purpose on the African continent regarding the issue of local value addition.

“We are no longer going to allow anybody or license any company that wants to go into the mineral sector without giving us a plan for local value addition,  like processing, refining and this has a multiplier effect on the economy.

“It instantly generates employment rather than a few people carting away lithium, gold, and the likes to other countries to sell.

“These minerals must now be processed in Nigeria, creating more value and beneficiation for local communities where they are sourced, ” he said.

Reports says that the minister had earlier received members of the House Committee on Solid Minerals who were on oversight visit to his office.

The minister commended the lawmakers for their support in repositioning the mining sector, stressing that boosting the economic profile of Nigeria required joint task by both the executive and legislature.

He acknowledged the significant contribution of sub-nationals to mining development, emphasising that state chairmen of  Mineral Resources and Environmental Management Committee (MIREMCO) and five committee members were nominated by state governments. (NAN)

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