…Presents revised 2020-2022 mid-term expenditures framework (MTEF) and the 2020 Budget
THUR, MAY 28 2020-theG&BJournal- President Muhammadu Buhari is seeking approval from both the Senate and House of Representative to borrow $5.513 billion to finance the revised 2020-2022 mid-term expenditures framework (MTEF) and the 2020 Budget which he says has become necessary due to the sharp cut in the global oil price as well as drop in local oil production.
The President also referred to the assumptions underlying the 2020 Appropriation Act saying it is no longer sustainable, noting that it is imperative to adjust expected revenues and reallocate resources in the budget to ensure the implementation of emergency measures and other actions needed to mitigate the effect of the coronavirus pandemic.
The President is also seeking the House of Representative’s approval to borrow locally and internationally to finance projects to support state governors in the 2020 budget.
In the letter sent to House of Representative and read by House Speaker Femi Gbajabiamila, the President is seeking to borrow $3.4 billion from the International Monetary Fund (IMF), $1.5 billion from the World Bank, $500 million dollars from the African Development Bank and $113 million from the Islamic Development Bank.
$500 million from the proposed borrowing will go towards providing fiscal support to the States and another $500 million to finance the COVID-19 stimulus programme.
The letter on the revision of the Appropriation Act was subsequently referred to the House of Reps Committees on Appropriation and Finance while the letter on loans will be referred to the House Committee on Loans and Debts.
The revised MTEF was sent to the Senate for consideration and passage and includes request to authorise from the Consolidated Revenue Fund (CRF) the sum of N10, 509, 654,033,053 to be issued for statutory transfer, debt service, Recurrent Expenditure and as part of contribution to the Development Fund for Capital Expenditure.
The Breakdown is as follows:
Statutory Transfer-N398,504,979,362
Debt Service-N2,951,710, 000,000
Recurrent Expenditure-N4,928,525,467,849
Dev. Fund-N2,230,912,585,842
The revised 2020 budget is based on oil production benchmark of $25 per barrel, oil production estimate of 1.93 million barrels per day and an exchange rate of N360/$.
Senator Yahaya Abdullahi (Kebbi North) who led the debate on the revised 2020 budget in the Senate today noted that much of the key initial provisions in the 2020 budget is retained- such as the provision for Personnel and Pension cost which are retained at N2.83 trillion and N536.72 billion respectively.
It will be recalled that the Senate in April approved the N850 billion loan request put forward by the President. The loan is besides the $3.4 billion it has received from the International Monetary Fund (IMF) to support the country’s efforts in addressing the severe impact of the COVID-19 on oil prices and the economy.
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