The House of Reps, on Wednesday, September 30, passed the Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP) for 2021-2023.
The MTEF contains the framework which will be used for developing the budget. These will be the parameters used for the 2021 budget if the senate should concur with the parameters.
However, the Senate is yet to consider the report on MTEF.
The Reps approved the following parameters for the 2020 budget. Daily crude oil production was set at 1.86mbpd, oil benchmark at USD 40 per barrel, the exchange rate of N379 to US Dollar.
Also, the projected growth rate pegged at GDP 3.00%, with inflation expected to be at 11.95 per cent.
With all these parameters, the 2021 budget expected for the 2021 budget as approved by the House is N13.08trillion.
The rolling plan was approved following the consideration of the reports of the committees on appropriation, finance, and national planning on Wednesday by the committee on supply.
According to the report, 2021 will run a deficit of N5.20trillion; and N4.28trillion will be borrowed from local and foreign sources.
Also, N3.12trillion will be spent on debt servicing, N5.67 trillion on recurrent expenditure; and N484.49 billion as the statutory transfer.
Speaking on the report, the Chairman of the House Committee on Finance, James Faleke (APC, Lagos) indicted revenue generating agencies of exploiting lacuna in existing laws to spend money at the detriment of Nigeria.
He noted that no reason why Nigeria should be borrowing to finance the budget.
The Reps committee, therefore, recommended that “the Committees on Finance and National Planning; and Economic Development in partnership with the Ministry of Finance, Budget and National Planning; and the Auditor General of the Federation to conduct a detailed analysis of all Ministries Departments and Agencies (MDAs) by the Federal Government of Nigeria.
“This is to identify more Agencies that need to be taken off the budget wholly or partially; and those that need to be retained, to further reduce the deficit burden of the Federal budget; and free up more resources for other critical projects.
“That most of these revenue agencies engaged either in outright nonremittance or under remittance of operating surpluses due to the CRF; in breach of the Fiscal Responsibility Act,2007 and the extant laws, that created the agencies.”
The recommendations were adopted by the Reps; and the Speaker announced that President Muhammadu Buhari will present the 2021 budget by next week.