Our Reporter
The Minister of Finance, Budget and National Planning, Zainab Ahmed has earned plaudits for the expeditious passage of the 2020 budget.
Following the signing of the 2020 Budget (Appropriation Bill) into law by President Muhammadu Buhari, he had twitted: “I’m pleased that the National Assembly has expeditiously passed this Bill. Our Federal Budget is now restored to a January-December implementation cycle.”
It may be recalled that President Buhari had laid the 2020 Appropriation Bill before the Joint Session of the National Assembly on 8th October, 2019 and forwarded the 2019 Finance Bill shortly thereafter.
“In the 20 years since the return to civilian democracy, this will be just the fourth time that the Federal Budget was passed before the end of the previous year, and this is the earliest,” Buhari also said on Twitter.
Taking into account the enormous efforts that go into the budget preparation processes, at the formal budget signing ceremony, the President said: “I wish to acknowledge the efforts of Zainab Shamsuna Ahmed, the Minister of Finance, Budget and National Planning, the Budget Office of the Federation, and all stakeholders, who collaborated and worked painstakingly, to produce the 2020 Appropriation Bill, that I have just signed into law.”
An elated Buhari had observed that Mrs Ahmed along with her colleagues within the Ministry and Budget Office and other key stakeholders ensured that during the budget preparations, trade-offs and prioritisation, among programs, were made to establish that the 2020 Appropriation Bill fits government policies and priorities.
This, according to the President, “will also be a landmark achievement worthy of recognition, being the first time, this has been done in the last 20 years.”
Ahmed, never set out for an overoptimistic budget that could lead to accumulation of payment arrears and muddle rules for compliance, but she has rather staked clear signals on the amount of expenditure compatible with financial constraints that should be given to spending agencies from the start of the budget preparation process.
But then the GDP expanded 1.94 per cent in the three months through June from a year earlier, as said by National Bureau of Statistics. That compares with a revised expansion of 2.1 per cent in the first quarter and a median estimate of 2.46 per cent in a Bloomberg survey. Growth was reported at its lowest level since the third quarter of 2018.
The 2020 Budget, tagged “Budget of Sustaining Growth and Job Creation”, is Nigeria’s biggest budget ever, totaling N10.59 trillion. It is up from the N8.83 trillion budget for 2019 and tops the previous record spending plan, the N9.12 trillion budget for 2018.
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According to the budget document, the GDP growth rate is projected at 2.93 per cent while inflation rate is put at 10.81 per cent. The budget is also based on an exchange rate of N305 per US dollar.
The 2020 budget took effect from January 1, 2020, provides an opportunity for the country to implement the annual January-December budget cycle following the timely passage of the appropriation by the National Assembly.
In her presentation, the minister said of the total N10.59 trillion budget, about N8.42 trillion revenue is provided for, consisting of about N2.64 trillion from oil, N1.81 trillion from non-oil and N3.97 trillion from other sources.
The budget also consists of deficit of N2.175 trillion. About N2.465 trillion is going for capital expenditure, N4.94 trillion for recurrent expenditure, N2.45 trillion for debt service, N273 billion for debt sinking fund, N350 billion for special intervention and N560 billion for statutory transfers.
On revenue projections for the year, the minister said while oil revenue will account for about 31.3 per cent of the total outlay, signature bonus/renewals will contribute 11.2 per cent, independent revenue sources (10.1 per cent), company income tax (CIT) 10 per cent, Customs (7.3 per cent) and domestic recoveries/fines (2.8 per cent).
She also mentioned revenue from government-owned enterprises (6.6 per cent), stamp duties (5.5 per cent) Federal Government’s share of actual balance in special accounts (4.1 per cent), Federal Government share in special levy accounts (3.5 per cent), value-added tax (VAT) (3.5 per cent), share of dividend from the Nigeria LNG (1.5 per cent) and other revenue sources (2.6 per cent).
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