The federal government is uncomfortable with the high recurrent as against capital allocations in the 2014 budget estimates, the Minister of Finance, Dr Ngozi Okonjo-Iweala, has said.
Speaking yesterday at the public presentation of the 2014 budget, the minister said it is not the desire of government to put such huge amount in recurrent leaving the capital expenditure with a far less fraction.
The minister said the major reason for the high recurrent expenditure this year are the awards and pension arrears of federal workers.
She further said that government realized that its funding alone cannot fund the infrastructure needed in the country which is why it is encouraging private sector participation.
"Each time personnel cost goes up, the recurrent will go up. The issue is that most of these agencies must receive these monies because that is what the laws says. That is why we are now working together with the National Assembly to repeal these laws in order to reduce such spending," Okonjo-Iweala said. She said she has been advocating for the reduction of recurrent expenditure, which is why in 2013 the amount was reduced to 67 percent.
"It is not just that we seat down and come up with such figures, we consider many parameters; the high recurrent expenditure is a great concern to us," she also noted.
Giving details of the budget, Okonjo-Iweala said that N3.73 trillion of the expected collectible revenue would be used to fund the 2014 budget, which focuses on boosting job creation and inclusive growth.
"The budget has been underpinned by the parameter of oil benchmark of 2.39 million barrels per day compared to 2.53 million barrel per day in 2013," she revealed.
The minister said the budget was also underpinned by a, "benchmark oil price of 77.5 dollars per barrel, projected real GDP growth of 6.75 per cent and average exchange rate of N160 per dollar."
She said the budget reflected "a total expenditure of N4.64 trillion representing about 7 per cent reduction from the N4.99 trillion budget in 2013.
On key allocations, she said that N655.47 billion was allocated to the education sector, including UBEC and TETfund, while the Ministry of Defence got N340.33 billion.
Similarly, she said the Ministry of Police Affairs and the Police Service Commission got N301 billion, the Federal Ministry of Health received N262.74 billion, while the Ministry of Works had N128. 65 billion.
Speaking at the presentation, Minister of Power, Professor Chinedu Nebo, said the power problems in the country will soon be over with the kind of reforms going on in the sector.