The Nation Newspaper

Tag: Fed Govt

  • Fed Govt votes N1.22tr for fuel subsidy

    Fed Govt votes N1.22tr for fuel subsidy

    The Federal Government  plans to spend  N1.221.4trillion to subsidise the importation of premium motor spirit (PMS) or petrol and dual purpose kerosene (DPK) or kerosene next year.

    The proposal is contained in the Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) sent to the National Assembly by President Goodluck Jonathan for consideration and approval.

    A total of N971.4billion is being proposed as subsidy on  PMS while N250 billion would be spent as subsidy on DPK.

    There was no provision for kerosene subsidy in this year’s budget of N4.724 trillion.

    The document also contained a projected sum of N4.817trillion as budget for next year.

    The Fiscal Responsibility Act provides that the National Assembly must consider and approve the MTEF/FSP before the president presents the budget to a joint session of the National Assembly.

    The Federal Government also projected that it would spend N1.029 trillion as capital expenditure for ministries, departments and agencies (MDAs) while N1.801 trillion would be spent as personnel costs for the MDAs.

    According to the document, service wide votes would gulp N376.05 billion while N570 billion is projected as new borrowings next year.

    As part of efforts to tackle crude oil theft and pipeline vandalism, the security agencies are expected to start ground and aerial surveillance while the Justice Ministry would ensure speedy prosecution of oil thieves and vandals.

    The document read in part: “The activities of crude oil thieves and oil pipeline vandals remain the main risks to oil production. The potential implications of their activities are a reduction in government revenue with further impacts on government debts and fiscal deficits as well as pressures on the exchange rate.

    “Given the role of oil production volume on government finances, government remains committed to curbing these nefarious activities. Consequently, it is intensifying security, particularly ground and aerial surveillance, around oil facilities through the combined efforts of security agencies and local communities’ participation.

    “These security forces under the National Executive Council Committee are being better equipped to checkmate the activities of oil thieves and pipeline vandals. There would also be better engagements of the Ministry of Justice and lawyers for faster prosecution of oil thieves.

    “In addition, a quick passage of the PIB will undo the uncertainties undermining new investments in the oil industry, thereby raising oil production.”

    The Federal Government also told the National Assembly that it has already set up a committee which is expected to partner with other agencies to tackle the Boko Haram sect.

    It said: “The issue of insurgency in parts of the Northeast is still a risk to economic and commercial activities, and by extension, government tax revenue. Consequently, government will intensify the utilisation of its three-pronged approach including a firm security response, continued political dialogue and a package of development assistance to check mating the security situation.

    “Already, a Presidential Initiative for the North East (PINE) Committee is working together with some development partners to finding a lasting solution to the insurgency.”

    Meanwhile, the MTEF/FSP was yesterday committed to the Senate Committee on Finance and National Planning for more legislative work.

    Senate President David Mark gave the affected committees two weeks to report back to Senate.

  • Fed Govt projects N11.163trn revenue, 6.35% GDP

    Fed Govt projects N11.163trn revenue, 6.35% GDP

    The Federal Government yesterday projected N11.163trillion revenue for next year as opposed to N10.894 billion approved for this fiscal year.

    According to the 2015-2017 Medium Term Expenditure Framework (MTEF) and Strategic Paper Policy obtained by The Nation in Abuja, N7.286 trillion is also expected from the federally collectible oil revenue next year as against N7.164 trillion approved in the Appropriation Act for this year.

    The document stated that the value of United States (U.S.) import of Nigeria’s crude oil dropped by about 69 per cent from $38 billion in 2008 to $12 billion last year, adding that crude oil production in the U.S. would average 9.3 million barrels per day (bpd) next year.

    The Federal Government also proposed a $78 bpd oil benchmark for next year while $79 per barrel is for both 2016 and 2017.

    On revenue generation, the Federal Government is eyeing N67.5 billion, representing a growth of 3.5 per cent as government’s efforts in capturing/formalising the informal sector begin to yield results while 25 per cent of revenue realised by government-owned enterprises were benchmarked for next year.

    The MTEF document also noted that “the peculiarity of 2015 as an election year with potential fiscal implications makes it strategically important to continue to drive policies that will ensure strong macroeconomic fundamentals.

    “In this regard, government will further stimulate domestic activities by creating a favourable business environment and through its various incentives to promote broad-based growth.”

    The executive also resolved that in a bid to boost revenue generation, there is need to enforce effective monitoring and audit of revenue collections, curbing “smuggling activities through appropriate tariff policies, coordinated border management and intelligence gathering and networking; continuous enlightenment of stakeholders targeted at improving the level of compliance in revenue remittance and intensified collaboration between FIRS (Federal Inland Revenue Service) and McKinsey.”

    The document showed that the nation’s debt stock stood at about $65.26 billion as at March 31st this year comprising $9.17 billion external debt and $56.09 billion domestic debt.

    From the total debt stock, the Federal Government was responsible for 80 per cent while the 36 states and the Federal Capital Territory (FCT), Abuja accounted for the balance of 20 per cent and implies a debt to GDP ratio of 12.8 per cent.

    The government said through the public service reform, the administration via the introduction of IPPIS saved the sum of N139.6 billion and discovered 46,821 ghost workers.

  • Nigeria spends $3.3b on steel importation, says Fed Govt

    Nigeria spends $3.3b on steel importation, says Fed Govt

    Nigeria has about two million metric tonnes of iron ore reserve, yet it spends $3.3 billion annually importing steel and iron, the Minister of Trade and Investment, Olusegun Aganga, has said.

    He said the country had the second largest iron ore deposit in Africa and the 12th largest in the world, but it may end up spending $15 billion every year to import steel.

    The minister spoke at the weekend in Ilorin, the Kwara State capital, at the inauguration of the Cold Roll Mill Project of Kamwire Industries Ltd.

    He said President Goodluck Jonathan “has set up a committee on how we can ensure that our industries, especially in the real sector, have access to affordable finance and the Bank of Industry will play a major role.”

    His words: “We spend $3.3billion every year importing these items. In the next decade, because of the way we are growing, $3.3billion will become $15billion.

    “Today, we have about a minimum of $14billion committed to the petrochemical sector, where its spread, as I have just described to you, hopefully will be gained by 2017 or 2018, when we will be self- sufficient and we will not import petroleum products.

    “Any country, which relies on exporting raw materials without having a strong industrial and related service sector will remain poor. We have made a mistake for decades thinking we are a rich nation, exporting crude, thinking we have money. But we do not have money. I am your former Finance Minister, so I know. We may have that competitive advantage, but what makes us different is what you do with that competitive advantage.

    “We are working on infrastructure and power already, with a lot of commitments going into the power sector. We are working on it and we will get there. It takes three years or thereabouts from where you start.”

  • Fed Govt, ODUA plan trade fair

    The Federal Government has concluded plans to partner Odua Chamber of Commerce, Industries, Mines and Agriculture (ODUACCIMA), for a regional international trade fair, which will attract over 5,000 exhibitors and participants.

    The Chairman, 2014 Odua International Trade Fair Planning Committee, Asiwaju Olaitan Alabi, spoke at a news conference at the MKO Trade Fair Complex, Abeokuta, to herald the trade fair slated for November 21.

    Accompanied by the National President of Oduaccima, Iyalode Alaba Lawson and other Southwest executives, the chairman said the fair would hold at the Trans-Amusement Park, Ibadan, the Oyo State capital.

    He said: “Oduaccima is an association of the chambers of commerce and industry in the Southwest, comprising  Oyo, Ogun, Ondo, Osun and Ekiti states. It will organise this trade fair in collaboration with the Federal Government and the Southwest governments,”

    Alabi said the theme of the fair is ‘Promoting Mass Agricultural Production and Agro Processing as Panacea to Unemployment and Poverty in Nigeria’.

    He explained that the association’s mission is to complement the efforts of the state governments to revitalise and bring back the lost glory of agriculture through annual international trade fairs.

    Iyalode Lawson urged Southwest governors to forget their political differences and face the reality of the permanent economic ties, which bind them.

    She said: “Development Agenda of Western Nigeria (DAWN) is an incredible initiative that should not be politicised. Agriculture, being the mainstay of our economy in those days, was the unifying factor that bound us from Lagos to the River Niger.  This same agriculture can still bind us in the present Southwest.”

  • Saraki blames Fed Govt for Ilorin flood

    Saraki blames Fed Govt for Ilorin flood

    Chairman of the Senate Committee on Environment and Ecology Senator Bukola Saraki has blamed the Federal Government for the flood in Ilorin, the Kwara State capital.

    Saraki said its failure to complete the channellisation of the River Asa in Ilorin led to the loss of property worth millions of naira by residents loving on the river’s path.

    The contract for the channellisation of the river was awarded during the administration of the late President Umaru Yar’adua, but work did not begin until about three years ago.

    This year, flood has affected residents at the southern end of the river. Saraki, who visited some of the affected areas at the weekend, said his committee would invite the minister of Environment and the Ecological Fund Unit in the Presidency to shed light on the matter when the Senate reconvenes after the holidays.

    He said there was no excuse for not completing the project, urging the National Emergency Management Agency (NEMA) to assist those displaced by the flood.

    Saraki said: “If the job was done according to the programme, we could have avoided the destruction of over 300 houses. The non-completion of the contract is responsible for the displacement of the occupants of the flooded houses and some people are responsible for that. Somebody must be held accountable; somebody must ensure that the contractors’ claim of paucity of fund is rectified. More funds should be released to the contractors.

    “We are lucky that no life was lost. The funds are available, so they should be made available to the contractors. This is the kind of thing that made us review the efficacy of the ecological funds. If necessary steps are not taken and flooding happens again, God forbid, lives might be lost. There is need for prompt action and the state government has written NEMA to ensure that relief materials are provided for the victims.

    “The people don’t care about who is at fault between the awarding ministry and the contractors, all they want is for the job to be done. Any further damage or loss of life will amount to recklessness on the part of those responsible for the project. NEMA and the Federal Government should compensate the victims. If the job was concluded on schedule, we would not witness what is happening today.”

  • Fed Govt mulls more investment in Transcorp

    Fed Govt mulls more investment in Transcorp

    Despite selling off some public assets, the Federal Government is considering additional investment in Transcorp Hilton Hotel Plc.

    The Director-General, Bureau for Public Enterprises (BPE), Benjamin Diki made this known at the public presentation of the Transcorp Hilton Hotel’s Initial Public Offer (IPO) in Abuja.

    He said government is considering making further investments in this company because Transcorp has been paying dividend for the past five years consistently and the federal government, being a shareholder has been enjoying this dividend, and that is why the federal government can recommend to Nigerians to buy this stock.

    Government’s interest in boosting its investment in Transcorp Hilton he said “is to tell you the level of profitability of this company and we recommend Transcorp to every Nigerian, even if it is 10 shares buy it, we will see what will happen in the future, we are supporting a good deal for Nigerians.”

    The BPE boss noted that “government’s 49 per cent share holding is now being diluted because government has not yet taken up its rights issue, and government has enjoyed high dividend from this stock.”

    He said the federal government has not brought other shares to the Nigerian public “because we are not confident of their fundamentals, they have not been making profit, they have not been paying dividends on a regular basis. We don’t want to come and sell shares to Nigerians, then they will wait one, three, or five years without dividend.”

    Speaking to journalists at the event, the Managing Director, Transcorp Hilton Plc, Valentine Ozigbo, said Transcorp Hilton is Nigeria’s best example of Public Private Partnership (PPP) because Transcorp is a very serious investor.

    Ozigbo said over the next five years, the company will take a phased approach in developing high-end hotels in Ikoyi, Port Harcourt, Ikeja and Warri, as well as a Convention Centre and Apartment complex in Abuja, in addition to paying even higher dividends than it is currently doing.

    He said the company is raising up to N8 billion through the IPO offering of 800million ordinary shares of 50 kobo each at N10 per share to capitalise the development of new projects.

    He said the company will utilise the proceeds from the IPO to develop two high end hotels in Lagos and Port Harcourt and major commercial centres, in order to capitalise on the increasing demand for world class amenities, while Hilton Worldwide will serve as the Operator/Manager of all the proposed new developments which will become part of the international Hilton Hotels chain across Nigeria.

    Ozigbo explained that the Transcorp Hilton Ikoyi Hotel will be an upscale hotel on a 5,868 square metre site at 39, Glover Road, Ikoyi having 300 rooms and suites, with conference and leisure facilities, gym and spa and a swimming pool.

    The project is expected to be supported by a growing population of young and wealthy Nigerians and business travellers, and it will be jointly owned by Transcorp Hotels and Heirs Holdings.

    The estimated cost of the project is put at $140 million (N22.68 billion), with the cost of land going for $15 million or N2.43 billion. Construction cost is said to cost $125 million, or N20.25 billion, and the projected commencement date is the fourth quarter of 2014, with three years construction period if the Lagos State government issues the permit on time.

    Transcorp Hilton Port Harcourt on the other hand, will be a 250 room hotel facility with conference and leisure facilities located in the Ero Road, Port Harcourt, GRA.

    The project will be built on 10,141 square metres of land at an estimated project cost of $105 million, or N17.01 billion. The cost of land is put at $5.86 million, or N950 million, with construction cost put at $100 million, or N16.20 billion. The projected commencement date is the fourth quarter of 2014, with three years construction period.

    The company has also commenced the renovation of the Transcorp Hilton Abuja. The renovation involves the modernization of core facilities of the hotel, for which Transcorp  plans to spend approximately $57.5 million, or N9.2 billion over the next three years.

    The funding for this renovation will be sourced from the company’s cash flows from operations.

  • Fed Govt declares Oct. 6, 7 public holiday

    Fed Govt declares Oct. 6, 7 public holiday

    The Federal Government has declared Monday 6th and Tuesday, 7th of October, 2014 as Public Holiday to mark the Id-el-Kabir Sallah Celebration.

    Minister of Interior, Comrade Abba Moro, who made the declaration on behalf of the Federal Government of Nigeria, congratulated the Muslim Faithful and enjoined them to support, co-operate and join hands with President Goodluck Jonathan, in his sustained efforts to building a peaceful, united and virile nation.

    According to a statement issued by Permanent Secretary Ministry of Interior, Magaji Abubakar, Moro further urged all Nigerians to use this occasion to pray for peace and unity across the nation.

    He wished all Nigerians a rewarding and happy id-el-Kabir celebration.

  • Fed Govt to rehabilitate surrendered Boko Haram members

    Fed Govt to rehabilitate surrendered Boko Haram members

    The Federal Government has said it will soon begin the process of rehabilitating and re-radicalising Boko Haram members, who have surrendered their arms and weapons in the last one week.

    Coordinator of the National Information Centre Mr. Mike Omeri, who briefed reporters in Abuja yesterday, said religious leaders, the school system as well as residents of the area where the surrendered insurgents were being detained, would assist in the rehabilitation.

    The military said 135 Boko Haram members surrendered their weapons in Biu, Borno State, on Tuesday, while 133 others surrendered elsewhere in the Northeast.

    Omeri added that any member of the sect  apprehended without surrendering his weapons and arms would be brought to justice.

    He said the armed forces on ground in the Northeast and most especially in the troubled zone had discovered a winning strategy and would not rest until peace and security were restored.

    Omeri urged Nigerians to remain steadfast in their support to ensure that terrorism ended.

    He said: “Efforts are ongoing to rehabilitate and re-radicalise the Boko Haram members, who have surrendered their arms in the last one week. Religious leaders, indigenes and the school system will be involved in the rehabilitation.

    “The Federal Government has a zero tolerance for terrorism. The armed forces will remain strong, undaunted and motivated in the performance of their duties.

    “Nigerians are advised to support the fight, it will not last forever and I believe it will soon end.”

    On the abducted Chibok girl, Omeri said the Federal Government was working towards ensuring the eventual release and rescue of the girls.

    “It is a global challenge, which Nigeria will soon overcome. The Federal Government is taking measures to rescue them,” he said.

    On the issue of one of the abducted girls, who escaped from the Boko Haram custody, police spokesman Emmanuel Ojukwu said on September 24 about 5pm, a girl was seen at Mararaba, Mubi in Adamawa State wandering. He said she was picked up and upon interrogation, it was discovered that she was one of the abducted Chibok girls, who escaped.

    “She is undergoing medical treatment after which she will re-unite with her family,” Ojukwu added.

  • Fed Govt declares October 1 public holiday

    Fed Govt declares October 1 public holiday

    The Federal Government has declared October 1 as a public holiday to mark the country’s 54th Independence Anniversary.

    Minister of Interior Comrade Abba Moro, who spoke on behalf of the government, congratulated Nigerians at home and abroad, urging them to build a more united and virile nation, which would be the pride of all citizens wherever they lived.

    According to a statement by the Permanent Secretary, Ministry of Interior, Magaji, the minister enjoined Nigerians to use the period to reflect on the giant strides made by government in the development of the country towards building a more formidable Nigeria, especially under the transformation and visionary leadership of President Goodluck Jonathan.

  • Fed Govt to increase gas flaring fine

    The Federal Government is planning to raise the fine paid on flared gas by oil companies in Nigeria and the committee working on the project may submit its report next month, it was learnt.

    A source told The Nation in confidence that a committee set up by the government is working on the appropriate fine that will compel companies to faithfully comply with government’s aspiration for zero gas flaring from all the oil producing fields.

    Oil producing companies in Nigeria currently pay a fine of $3.50 per 1000 standard cubic feet of gas flared, which most of the companies were said to smartly evade. According to the Department of Petroleum Resources (DPR) report, Nigeria loses $4.9 million daily when the quantity of flared gas is computed at the rate of $3.50 per 1000 standard cubic feet. At   that rate, the loss amounts to $1.7885 billion per year, the agency said.

    Although the source didn’t disclose what the new fine will be, he noted that the committee comprised of representatives from the major stakeholders in the gas industry including the petroleum and power ministries and the Nigerian Electricity Regulatory Commission (NERC), among others. The source said that the committee will recommend enough penalty regime that will compel oil firms to commit to utilisation of associated gas that is being flared. The report will be out next month, the source added.

    The source said that the decision to increase the fine became imperative because of gap in gas supply and demand. Despite the huge gas resource in the country, we don’t have enough gas to power electricity generation companies, which is grave setback to economic and industrial development, he said. Besides, he said that the country flares more gas than it utilises, which is not complimentary.

    He said the situation is worsened by the fact that Nigeria’s source of power supply is predominantly thermal, which accounts for over 70 per cent of the total energy supply. He said that Power Ministry and NERC were represented in the committee because of Federal Government interest and desire to provide stable power supply.

    An estimated 1.4 billion cubic feet of gas is flared per day, and this occurs through the year. Last year, the House Committee on Gas Resources during the presentation of its report on a Bill for an Act to Amend the Associated Gas Re-injection Act No. 99 of 1979 Cap. A25, Laws of the Federation of Nigeria, put the nation’s loss to gas flaring at $2.5 billion yearly.

    Although the government increased penalty for gas flaring from N10 to $3.5 per 1000 standard cubic, the passage of the Petroleum Industry Bill (PIB) would fast-track the achievement of government’s aspiration to fully utilise flared gas, and reduce or eliminate environmental pollution caused by gas flaring.  “If the PIB is passed, it will put into effect modern petroleum legal framework and align operation of the Nigerian gas sector to international best practices and also enhance transparency in the sector,” the source said.