Nigeria: Govt Proposes to Slash 2020 Budget By N312.8bn

9 April 2020

The federal government is proposing a 20 per cent cut in the capital expenditure across Ministries, Departments and Agencies (MDAs) in the 2020 budget to the tune of N312.820 billion.

The proposal, titled "2020 Capital Revised Adjustment," was one of the highlights of the presentation of the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, before the leadership of the National Assembly in Abuja wednesday.

The budget slash includes 32 expenditure items totalling N158.508 billion and another N154.311 billion cut from specific lines that the minister did not, however, list.

The new allocation for the 2020 capital expenditure items includes N3.84 billion for anniversary celebration; computer software acquisition N3.1 billion; construction and provision for office building - N24.8 billion; construction of residential building - N479.6 million; monitoring and evaluation - N10.8 billion; purchase and acquisition of land - N1.4 billion; purchase of motorcycles - N176.5 million; purchase of buses - N485.7 million; purchase of computer printers - N151.4 million; purchase of computers- N1.9 billion; purchase of motor vehicles - N5.2 billion and purchase of office furniture and fitting - N3.9 billion.

Others include purchase of photocopy machines N131.4 million; purchase of power generating sets - N555.9 million; purchase of residential buildings - N170 million; purchase of residential furniture - N50.3 million; purchase of scanners - N193.7 million; purchase of shredding machines - N1.8 million; purchase of trucks - N134.4 million; purchase of vans - N216.2 million; rehabilitation/repairs of office buildings N49.5 billion; rehabilitation/repairs of residential buildings N1.079 billion; research and development - N45.5 billion; construction and provision of agricultural facilities - N180 million; provision of infrastructure - N756 million; construction of roads - N1.9 billion; provision of water facilities - N650 million; provision of water ways - N650 million; purchase of sporting equipment N100 million; and rehabilitation of public schools - N330 million.

However, the official exchange rate for the budget is N360 to $1, against the old rate of N306.

Meanwhile, the National Assembly has tasked the executive arm of government on the need to ensure equity and fairness in the distribution of stimulus.

President of the Senate, Dr. Ahmad Lawan, at a meeting of the National Assembly leadership with some members of the Presidential Committee on COVID-19 in Abuja, said all parts of the country should be considered in the intervention initiative.

"We must ensure that there is equity - that there is fairness in the interventions. Every part of this country should have something to ameliorate the situation whether it is Coronavirus infected or not.

"In fact, some of our states have been in a very difficult situation before the outbreak of Coronavirus and such interventions will definitely help," Lawan said.

He also tasked the agencies of government to ensure that they streamline their activities along the provisions in the 2020 budget and to avoid needless duplication of projects.

He advised that the stimulus package should align with what was already in the 2020 budget so that there would not be duplication.

The Senate President said: "In our last meeting, the Minister of Finance, Budget and National Planning indicated very clearly that the executive is proposing a N500 billion stimulus package. While this is a very good proposal, how we wish you could even have more than N500 billion. But my concern is that we should not duplicate what is already in the 2020 budget.

"And of course, there is utmost need to streamline what the Federal Ministry of Finance is proposing and what the Central Bank of Nigeria (CBN) is also proposing. Some of the proposals may have a spillover effect on some projects."

He said the federal government should ensure that the interventions had very clear and definite measurable targets. "We shouldn't just throw money and there and then we don't see anything. The National Assembly will monitor every single kobo if and when the proposal is endorsed," Lawan said.

According to him, the meeting presented an opportunity to have all the facts regarding the current situation on Nigeria's crude oil and the amendment being contemplated as regards the Medium Term and Expenditure Framework (MTEF) and 2020 budget.

In her submission, Ahmed said the meeting was designed to be a consultative forum to bring the National Assembly leadership up to date on what the executive has been doing but also to take the National Assembly's feedback, guidance and advice as it moved forward towards adjusting MTEF, adjusting the budget as well as designing the N500 billion stimulus package.

Those who attended the meeting included Minister of State for Petroleum, Chief Timipre Sylva; and CBN Governor, Mr. Godwin Emefiele; Speaker of the House of Representatives, Hon. Femi Gbajabiamila; Deputy Senate President, Senator Ovie Omo-Agege; Deputy Speaker, Hon. Idris Wase; other principal officers and some members of Senate and House committees.

Presidency Dismisses Claims of N2trn Expenditure on NSIP

Meanwhile, the presidency has dismissed claims by the leadership of the National Assembly that the National Social Investment Programmes (NSIPs) of the federal government has gulped N2 trillion so far.

The presidency also disagreed with the lawmakers, arguing that the programmes have not failed.

A statement by the Special Adviser to the President on Social Investments, Mrs. Maryam Uwais, titled: "Lawan, Gbajabiamila Got It Wrong," rejected the claims of Lawan, and Gbajabiamila, saying they were deliberately conceived to undermine the effectiveness of the programme under the supervision of Vice President Yemi Osinbajo in the past.

According to Uwais, a prompt reaction has become compelling because of "the gravity and implications of the narrative conveyed, as well as the caliber of persons involved."

She dismissed claims that NSIPs had gulped N2 trillion since 2016, saying on the contrary, the total amount appropriated by the National Assembly for the programme since inception was N1.7 trillion, explaining that it was not only that the total appropriation was less than the figure claimed by the two leaders but also that the highest release so far was 57.8 per cent in one fiscal year.

Uwais said: "While the total appropriation by the National Assembly (NASS) from inception, for the four NSIPs, is N1.7 trillion, the actual funds released for the NSIPs between January 2016 and October 2019 (when the NSIPs were handed over to the Ministry of Humanitarian Affairs, Disaster Management and Social Development), amounted to N619.1 billion, constituting 36.4 per cent of the total appropriation from the NASS.

"Also, the monies released for NSIPs can be further broken down into 14.03 per cent (2016); 35 per cent in 2017; 43.5 per cent in 2018 and 57.8 per cent (as at September 2019) of the N500 billion in 2016 and N400 billion appropriated for the subsequent years. It should be noted that for 2017 to 2020, a sum of N100 billion was appropriated specifically for the National Housing Fund hosted by the Federal Ministry of Finance.

"These releases covered operational activities and payments to 13,363,680 beneficiaries across all the four NSIPs, all of whom can all be verified either through their BVN numbers or their unique numbers generated by the National Social Register, those identities having been generated for the poorest of the poor who do not own bank accounts for sundry reasons.

"As at September 2019, the funds had expended as follows: On the: Job Creation programme (549,500 N-Power graduates and non-graduates and seven Technology Hubs); National Home Grown School Feeding Programme (in 33 states, 9,963,762 pupils to 107,862 cooks in 54,952 primary schools); the National Cash Transfer Programme (including the development of the National Social Register by the National Social Safety Net Coordination Office) 1,491,296 poor and vulnerable households comprising 6,056,872 individuals in 33 states and 620,947 cash transfer beneficiaries; and the Government Enterprise and Empowerment Programme (managed by the Bank of Industry); a total of 2,279,380 TraderMoni, MarketMoni and FarmerMoni beneficiaries.

"In addition, it is false to claim that poor and vulnerable beneficiaries of NSIPs are made to apply online, through the internet and they require a BVN for payment.

"It is only in respect of the N-Power Job Creation programme that applications are made online after which successful volunteers are selected through a transparent process. Indeed, all the 774 local government areas nationwide currently have N-Power beneficiaries serving in different capacities.

"The utilisation of the BVN for N-Power beneficiary payment is also as a means of identity (since the NIN number can be generated from the BVN) and to facilitate the tracking of payments and further ensure accountability," she said.

The statement also explained the circumstances surrounding the disbursement of the national cash transfer programme, saying names of beneficiaries were drawn from a national social register which she said emanated from the ministries of planning from every state of the federation.

On the selection of beneficiaries of the scheme, she said:

"The process involves a poverty mapping of the local government areas in each state, community mobilisation, targeting, and identification supported by trained enumerators at state and local government levels, after which each of the households identified by the communities is visited and data collated.

"As of March 31st, 2020, the NSR comprised 11,045,537 individuals from 2,644,495 households, collated from 35 states, 453 local government areas, 47,698 communities. The identity of beneficiaries can be verified as each has a generated unique number and can be tracked."

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