The Senate Wednesday deferred debate on the Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Policy (FSP) submitted by President Goodluck Jonathan to the National Assembly last week with a resolve to investigate claims by the government in the document before setting the stage for a debate.
This decision followed the submission of Senate Minority Leader, Senator George Akume, after the presentation of a lead debate on the document by Senate Leader, Senator Victor Ndoma-Egba, alleging a breach of procedure in the preparation of MTEF and FSP.
Akume had alleged that the document was flawed and should be returned to the executive for fresh preparation, adding that the executive failed to consult relevant stakeholders before coming up with the document. According to him, preparation of a document of that magnitude should not be the exclusive preserve of the federal government.
Instead, he said the government should have been done in collaboration with relevant stakeholders such as the state governments. "This document is flawed and should be re-worked by the executive before sending it back to us," Akume said.
Earlier, Senator Enyinnaya Abaribe (Abia South), had remarked that before commencing a debate on the document, the committees on finance and appropriation were expected to have reviewed the submissions in the document and furnished the Senate with their findings.
The findings, he said, ought to serve as the bedrock upon which the debate would be predicated.
After further examination of the issues, the Senate asked the two committees to properly examine the document and report their findings to the Senate in two weeks. MTEF and FSP usually provide the basis for annual budget planning and consist of a macro-economic framework that indicates fiscal targets. The document also estimates revenues and expenditure including government financial obligations in the medium term. The document would cover 2014 - 2016 fiscal years.
The document as submitted by the president had shown N4.5 trillion budget proposal by the federal government as well as $74 benchmark in 2014. The document also showed a projected reduction in capital expenditure from 68 per cent in 2013 to projected 74 per cent in 2014.
It also showed a downward projected slide from 32 per cent capital expenditure in 2013 budget to 26 per cent in 2014.
The fiscal document stated that in arriving at the decision to bench oil prices at $74 per barrel in 2014, the government took cognisance of "the weakening future prices occasioned by rising oil theft and unconventional oil supplies as well as slow economic recovery."
While noting that government's model of 15 and 10 years moving benchmark averages have produced a figure of $71.96 which it said was adjusted in consideration of the behaviour of future prices, the document states further that whereas in the last decade, oil prices rose to record levels and peaked at $48 per barrel in July 2008, it has since been sliding downwards since 2012 with a looser demand-supply balance.
The government also disclosed that after extensive consultations with the Nigerian National Petroleum Corporation (NNPC), and in observance of the persistent oil theft, illegal bunkering and other production challenges, it had opted to project crude oil production for 2014 at 2.3883 million barrels per day.
The projected crude oil production at 2.3883 million barrels per day in 2014 is 143,000 barrels per day lower than the 2.526 million barrels per day in the 2013 budget.
The fiscal paper further showed that the government was projecting a 6.75 per cent Gross Domestic Product (GDP) growth in 2014, a slight increase from 6.5 per cent in 2013.
The GDP growth, the federal government stated, would be driven by strong performance in agriculture, wholesale and retail, construction and real estate sectors, among others.
The document also stated that expected revenue from non-oil sectors in 2014 was benchmarked at 25 per cent of the total revenue.