President Muhammadu Buhari of Nigeria has presented a borrowing plan of N5.62 trillion for 2021 to the Senate for approval, aggregating the country’s total debt to N38.7 trillion.
As at March 31, 2021, Nigeria’s current debt profile stood at N33.1 trillion.
The new borrowing plan is contained in 2022-2024 Medium Term Expenditure Frameworks (MTEF) and Fiscal Strategy Paper (FSP) that was sent to the Senate by Buhari for approval and set for passage soon.
Before the request was forwarded to the Senate for approval, the Federal Executive Council (FEC) discussed the document and accepted the budget proposal of N13.98trillion for 2021 with N9.16 trillion as forecasted revenue generation while the N5.26 trillion deficit will be covered up with loans.
While explaining to journalists, Minister of Finance, Budget and National Planning Zainab Ahmed revealed that the aim is to improve Nigeria’s macro-economic situation and reposition the economy on a sustainable path.
She said: “The MTF FSP consists of medium-term macro economic projections, fiscal targets and estimates of revenue and expenditure including government’s financial obligations.
“We have also presented to the federal government the projected revenues for the 2022 to 2024 specifically for 2022.
“The revenue that we expect is 6.54 trillion and 2.62 trillion to accrue to the Federation Account on VAT respectively. And then there will be net oil and gas revenue available for the Federation Account (FAAC) for distribution will be N6.15 1 trillion in 2022.
“This revenue is projected to increase in 2023 to N9.15 trillion. The total expenditure that we are expecting we have projected and approved by Council is an aggregate expenditure of N13.98 trillion which includes N1.1 trillion of government owned enterprises expenditure as well as grants and donor funds donor funded projects in the sum of 62.24 billion.
“This means that this budget is just 3% higher than the 2021 budget in terms of the size of expenditure. We also reported to council the budget deficit and the financing items for the expenditure.
“The budget deficit that is projected for 2022 is 5.62 trillion, up from 5.60 trillion in 2021. This amount represents 3.05% of the estimated GDP, which is slightly above the 3% threshold that is specified in the Fiscal Responsibility Act.”
After receiving the document the strength of Order 1(b) of the Senate Standing Rules, Senate Leader Yahaya Abdullahi moved a motion to consider the request instantly by sending it to relevant committees for the needed legislative inputs and submission of report.
The motion was seconded by Senate Minority Leader Enyinnaya Abaribe (PDP Abia ) before Senate President Lawan put it to voice votes and the Ayes had it.
In accordance with the procedure, Lawan forwarded the documents to Senate joint Committees on Finance, National Planning, Banking, Petroleum (Upstream), Petroleum (Downstream) and Foreign and Local Debts for required consideration at the committee level.
He said: “This is an important request from the President that must be considered and approved before we proceed on long recess Thursday this week.
“Therefore, the joint committee which is to be led by the Committee on Finance should use Tuesday and Wednesday to work on the request and submit report for final consideration and approval on Thursday.”
