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Nigeria’s N13.59 trln 2021 budget awaits presidential assent after transmission by N/Assembly

By on December 28, 2020 0 101 Views

By Oludare Mayowa

 

The hope that the 2021 N13.59 trillion budget passed recently by the National Assembly will be signed early was rekindled as the appropriation bill has been transmitted to President Muhammadu Buhari.

A presidential aide confirmed the transmission of the budget to the president in line with the law, which requires the president to assent to the bill before it can become law.

“The Appropriation Bill has been transmitted by the National Assembly to Mr President in conformity with the provision of Section 59 of the constitution. The bill is presently being looked at by Mr President and consequent action will be taken in due course.”

The 2021 appropriation bill was passed by National Assembly On December 21, in line with the determination of the two arms of government to sustain the January to December fiscal year calendar for the country.

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The parliament, however, jacked up the total spending estimate submitted by the federal government by over N505 billion at the point of the passage of the appropriation bill.

The budget document contains capital supplementation of N1.06 trillion, total capital expenditure of N4.1trillion, statutory transfers of N496 billion, and recurrent expenditure of N5.6 trillion.

Also, contained in the spending estimate for 2021 include N3.3 trillion for debt servicing.

The 2021 budget is predicated on the parameters approved by the National Assembly when it considered the Medium Term Expenditure Framework/Fiscal Strategy Paper two weeks ago.

In a review of the 2021 budget, the tech driven civil society group BudgIT noted that the country’s budget in nominal terms has grown from N4.5 trillion in 2015 to N10.8 trillion in 2020.

“The only way that the federal government has continually met its expenditure has been through the escalation of debts and
unfunded deficits provided by the Central Bank of Nigeria (CBN).

“According to the Budget Office, the federal government’s actual deficits in the last five years have stood at N1.52 trillion for 2015, N2.19 trillion (2016), N3.80 trillion (2017), N3.64 trillion (2018) and N4.17 trillion (2019).

“The consequence of this has been the rising cost of debt servicing which has grown from N624 billion in 2014 to N2.45 trillion as of 2019.

“Nigeria continues to trample on fiscal sustainability as debt service to revenue ratio has grown to 94 percent.
“This is a gross anomaly in the public finance analysis of a sustainable entity.

“Some experts might say that the country might not be borrowing too fast as debt-to-GDP is still approximately 29 percent at the end of 2019, but the complete story is that Nigeria has failed to gather revenues and its leaders do not want to take drastic measures required to significantly rationalise expenditure” the civil group stated in the review.

Economic observers said despite the increased budget since the advent of President Buhari government, not much has been achieved in terms of uplifting the living standard of Nigerians.

The country has slipped into recession twice during the tenure of the president, leaving the country’s currency worst than it was inherited from the previous administration. 

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