· As Budget Office warns of financial challenges
Teddy Oscar, Abuja
Any expectations that the 2014 Budget would be N5 trillion has been dashed, as the Budget Office has disclosed that the budget would be lower than the N5 trillion mark.
The total budget of 2013 as passed by both chambers of the National Assembly was N4,987,220,425,601.
But the director general of the Budget Office, Bright Okogu, hinted that the 2014 Budget is currently pegged at N4.6 trillion.
Okogu, who dropped the hint when members of the House of Representatives’ Committee on Appropriation paid his office an oversight visit, also disclosed that the implementation of the 2013 budget is impeded not only by shortfall from oil revenue, but that of non-oil revenue.
He explained that progress recorded in the agricultural sector has adversely affected revenue to the Federal Government.
“The recent increase in import levies and duties on importation of rice to discourage importation and boost production of rice locally has seen an increase in production from between 400 to 500,000 tonnes to 1.3 million tonnes has its reverse side which has hit our revenue because people are not importing and therefore, duty we have on this has been lower,” he said.
He, however, noted that the budget implementation of 2013 has advanced.
“Capital releases are at N618 billion and fully cash backed out of which N475 billion utilised. Based on releases, utilisation rates as at the end of July is 76.83 percent with same rate cash backing percentage,” he said.
Okogu, who also warned that Nigeria could face bigger financial challenges, if oil prices continue to decline, said that the “price of Bonny Light Crude is down from $118.81 per barrel in February 2013 to$112.1 per barrel as at 23, September 2013. Nigeria will run current account deficit, if oil prices drop below $86 per barrel.”
Pointing out that insecurity is one of the major setbacks for revenues to the federation, Okogu hinted that agencies like the Federal Inland Revenue Service (FIRS) had informed his office that it had not been able to collect revenue from designated areas where there is conflict.
“Disruptions to Nigeria’s oil production and losses of almost 400,000 barrels per day (bpd) was recorded in the first half of the year. Insecurity in some parts of the country continues to affect non-oil revenue generation/collection. FIRS has told us that they have not been able to collect tax in some areas of their jurisdiction because of insecurity,” he added.
He scored the progress of constituency projects high, saying that it is at an advanced stage with N70 billion of the NI00 billion budgeted for 2013 released, and an additional N25 billion released for third quarter.
In his speech, the chairman of the committee, Hon. John Enoh, said that they came to get a brief on the level of implementation of the 2013 Budget for their information and for purposes of clarification when oversight reports from committees are being debated on the floor of the House.
“The Budget Office is the starting point because many ministries, departments and agencies (MDAs) will not spend money, if it is not released by your office. We want to know the level of releases made in the three quarters, cash backed releases, budget performance, with emphasis on capital releases,” Enoh said.
