The Federal Government has released N711.6 billion to Ministries, Departments and Agencies (MDAs) this fiscal year for implementation of capital projects, President Goodluck Jonathan said yesterday.
He was presenting a budget estimate of N4.92 trillion for the 2013 fiscal year at a Joint Session of the National Assembly.
Jonathan said further releases are to follow shortly for the fourth quarter of the year.
The President said the implementation of the 2012 Budget was on track, having begun effectively in April when it became law.
He said: “We have so far released N711.6 billion to MDAs for the implementation of their capital budgets while further releases are to follow shortly for the fourth quarter.”
Jonathan said the implementation of the 2011 capital budget in the first quarter of 2012, affected the implementation of the 2012 Budget.
The President said he took personal interest in the budget implementation since May by chairing weekly sessions with ministers and heads of parastatals on their progress.
Government, he said, was determined to use the budget to improve the people’s welfare.
The 2013 Budget, he said, was designed against the backdrop of global economic uncertainty.
He said: “By the end of the second quarter of this year, the global economy was recovering but at a very slow pace.
“Growth in a number of major emerging market economies, has been lower than forecast.
“Overall, global growth is projected at 3.3 per cent in 2012 and 3.6 per cent in 2013.
“The uncertainty surrounding the global economy, which could have adverse effects on commodity prices, highlights the downside risks for our economy.
“The oil market is well known for its volatility. We recall the 2008 experience at the height of the global economic downturn when oil prices fell almost overnight from $147 per barrel to $38 per barrel.
“This threat of oil price volatility remains constant and underscores the need to rely on a robust and prudent methodology to estimate the benchmark price.
“The global economic slowdown can also have far-reaching implications for the demand for our export commodities, given that the Euro zone and the USA account for over 50 per cent of the nation’s crude oil exports.
“These global developments are also being transmitted to our economy through a dampening effect on foreign capital inflows and remittances by Diaspora Nigerians.
“These are uncertain times in the world economy and my Administration is taking necessary steps to mitigate possible adverse effects of the global economic slowdown on Nigeria .
“I assure you that we are going to build up the necessary savings to protect the economy against a possible global recession or a slow recovery.”
Jonathan noted that despite the uncertainty in the global economy the country’s economy has done relatively well.
He said: “Over the past nine months, through a number of initiatives, we have created new jobs directly and supported many young entrepreneurs running SMEs to create jobs.
“Nigeria is looking to become more self-reliant again in food security, and we are increasing local content in our manufacturing processes and the oil and gas sector.
“As at the end of the second quarter, the economy recorded an impressive growth of 6.28 per cent compared to 5.4 per cent forecast for sub-Saharan Africa.
“It is gratifying to note that the non-oil sector remains the main driver of growth.
“There are also improvements in other macroeconomic indicators. Inflation has dropped from 12.9 per cent in June 2012 to 11.7 per cent in August 2012, and our goal is to reduce it further.
“Our foreign reserves now stand at US$41.6 billion – the highest it has been in over two years.
“We intend to continue with our programme of fiscal discipline and prudent monetary policy in order to continue to improve our country’s macroeconomic environment.
“Furthermore, in addition to being upgraded last year by Fitch and S&P rating agencies, Nigeria has now been included in the JP Morgan Emerging Markets Bond Index, signifying increasing investor confidence in our economy.
“In addition, the World Economic Forum has upgraded our ranking from 127 to 115 in the global competitiveness index.
“Here in Nigeria , we do not join the debate on fiscal consolidation versus growth because we believe in the need to do both; hence, we are continuing our focus of fiscal consolidation with inclusive growth.
“The fiscal consolidation policy has helped to strengthen our finances with a programmed budget deficit of about 2.85 per cent of GDP in 2012, now projected to drop to 2.17 per cent in 2013.
“Moreover, the share of capital expenditure in the total budget is increasing as we gradually reduce recurrent expenditures and also develop non-oil revenue sources.”
Jonathan said the 2012 Budget focused on achieving fiscal consolidation with inclusive growth using the budget balance as a fiscal anchor.
He said: “In that respect, while investing in key priorities, the budget also ensured that the deficit followed a downward trend over the medium term.
“This is being done through a more aggressive revenue collection drive and prudent management of available resources.”
On the cost of governance, he said government is determined to reduce it.
He said: “We are reviewing the recommendations aimed at rationalising agencies of the Federal Government with overlapping functions.
“This has been taken into account in the preparation of the 2013 Budget, and we expect some modest cost savings from this exercise in the course of the 2013 fiscal year.
“However, more significant progress will be made in 2014, as we work with the Legislature to harmonise those agencies that have enabling laws, but which also have duplicative mandates.”
He recalled assuring Nigerians that the proceeds of the partial withdrawal of petroleum subsidies would be applied to implementing the Subsidy Reinvestment Programme (SURE-P).
The implementation of this programme, he said, is continuing over the medium-term.
He said: “In the 2012 fiscal year, we had voted N180 billion for the implementation of social safety net programmes, road and rail infrastructure projects.
“So far, N36.5 billion of this amount has been utilised to support maternal and child health programmes as well as mass transit, roads and rail projects and job creation through the Community Services and Public Works programme.
“The SURE-P Board under the able chairmanship of Dr. Christopher Kolade is presently working hard to ensure the successful oversight of the implementation of this programme.”
The Federal Government, he said, has entered into partnership agreements with states for the provision of 6,000 housing units, adding that another 600 housing units had been completed under the direct construction scheme of the Federal Housing Authority in these states.
He said the petroleum sector has continued to play a crucial role in the country’s economy.
“In this regard, we are taking steps to modernise the sector. A robust Petroleum Industry Bill (PIB) has been delivered as promised to the National Assembly for consideration.
“When passed into law, the Bill will provide the new legal framework that will govern Nigeria ’s oil and gas industry,” he said.
On fuel subsidy, he said: “We are tightening up the payment regime, to weed out corruption while working hard to recover monies fraudulently obtained from the subsidy regime.
“The Economic and Financial Crimes Commission (EFCC) is prosecuting those found wanting and the efforts to crack down on corruption in this sector will continue.
He said government’s drive to build up the nation’s oil reserves was yielding results with discovery of crude oil in some inland sedimentary basins.
The President said: “These include the Chad Basin , Benue Trough, Yola Basin and Anambra Basin amongst others. We are determined to further develop on these findings and expand the scope of such explorations.”
