10-15-2019, 08:14 AM
Quote:The Minister for Finance , Budget and National Planning , Mrs . Zainab Ahmed , says under - recovery of Premium Motor Spirit , popularly referred to as fuel subsidy, will gulp N 450bn in 2020 .
She said this on Monday in Abuja , at the public presentation of the 2020 budget proposals.
Ahmed said it was called ‘under -recovery ’ because it was the cost of operation of the Nigeria National Petroleum Corporation.
“ We have a provision for under -recovery of PMS in the sum of N 450 bn . If you look at the Budget office ’s website , it is in the fiscal framework , which is an annexure to the budget.”
The News Agency of Nigeria reports that President Muhammadu Buhari had , on Tuesday , presented a budget proposal of N 10 .33 trn to a joint session of the National Assembly .
He put the Federal Government ’s estimated revenue in 2020 at N 8. 155 trn, comprising oil revenue of N 2. 64 trn, non- oil tax revenues of N 1. 81 trn and other revenue of N 3. 7 trn.
Other estimates are N 556 .7 bn for statutory transfers , N 2 . 45 trn for debt servicing and provision of N 296bn as sinking fund .
The 2020 budget is based on an oil production estimate of 2 .18 million barrels per day , oil price benchmark of 57 dollars per barrel and an exchange rate of N 305 to a dollar .
Ahmed said that recurrent ( non- debt ) spending was expected to rise by 11 .28 per cent , from N 4 . 39 trillion in 2019 to N 4. 88 trillion in 2020 .
This, she said, would reflect in salaries and pensions , including provisions for implementation of the new minimum wage .
Ahmed said that the overall budget deficit of N 2 .17 trillion represents 1 .52 per cent of the Gross Domestic Product ( GDP ) and N 1 .64 trillion of it would be funded by both domestic and external borrowing .
According to her, the external sources will provide N 850 billion, while domestic sources will provide N 744 .99 billion.
Citing the top 12 Ministries , Departments and Agencies ( MDAs ) capital allocations , she said the Ministry of Works and Housing was allocated N 259 . 2 billion , Ministry of Power N 127 . 67 billion, Ministry of Transportation N 123 . 07 billion , Ministry of Education ( including Universal Basic Education Commission ) N 162. 74 billion.
Others are Ministry of Defence N 99 .87 billion, Ministry of Health N 90 .98 billion, Ministry of Agriculture and Rural Development N 79 . 79 billion and Ministry of Water Resources N 78 .34 billion.
Some others are: Ministry of Humanitarian Affairs, Disaster Management and Social Development N 45 . 45 billion , Ministry of Aviation N 53 . 85 billion , Ministry of Industry , Trade and Investment N 41 .34 billion and Ministry of Science and Technology N 37 .55 billion .
She , however, said that there were key expenditures captured in the Medium Term Expenditure Framework ( MTEF ) , but were not in the 2020 budget.
“ They are N 61 billion for the Presidential Power Initiative, N 1 .22 trillion for federally funded projects in the oil and gas sector to be undertaken by NNPC on behalf of the federation .
“ Others are : N 272 billion as transfers to Tertiary Education Trust Fund ( TETFUND ) for infrastructure projects in tertiary institutions and N 82 .35 billion as transfer to Nigeria Sovereign Wealth Investment ( NSIA) for Public Private Partnership/ Presidential Infrastructure Development Fund ( PIDF ) , ” she said.
For revenue , Ahmed said there were Strategic Revenue Growth Initiatives ( SRGI ) aimed at boosting revenue generation to meet targeted revenue to GDP ratio of 15 per cent .
She said further that the SRGI would be implemented with increased vigour to improve revenue collection and expenditure management .
She said that Nigeria must mobilise significant resources to invest in human capital development and critical infrastructure .
“ Some reforms will be tough but they must be done to look at the facts and be frank to ourselves.
“ However, we will engage the public sector in whatever we do , including any changes in taxes , with regards to rates or administration methods . ”
https://punchng.com/fuel-subsidy-to-gulp-n450bn-in-2020-finance-minister/