Zainab Ahmed, the minister of finance, budget and national planning, on Thursday presented a revised 2020 Appropriation Act to the National Assembly and explained why the downward review of the national budget.
At the meeting were presiding and principal officers of both the Senate and the House of Representatives, including Ahmad Lawan, president of the senate; and speaker of the House, Femi Gbajabiamila.
The minister stated that “the $57 (per barrel) crude oil price benchmark approved in the 2020 budget is no longer sustainable.”
According to her, the upfront fiscal deductions by the Nigerian National Petroleum Corporation for mandated oil and gas sector expenditures was reduced by 65 per cent, from N1.22tn to N424bn.
The minister further explained that the federal government’s aggregate expenditure budget was slashed by N88.412bn; statutory transfers from N560.47bn to N397.87bn; and overhead costs of ministries, departments and agencies from N302.43bn to N240.91bn.
However, debt service provision was increased by N225bn, from N2.453tn to N2.678tn.
On provision of N500bn for COVID-19 Intervention Fund, the minister explained that N263.63bn would be sourced from the Federal Government’s special accounts; N186.37bn from the Federation Special Accounts and the balance of N50bn expected as grants and donations.
Lawan, in his welcome address, expressed the willingness of the federal lawmakers to expeditiously consider the proposed amendments to the budget, which the minister said would be presented to the National Assembly by next week.
In his remarks, Gbajabiamila called on the Federal Government to adopt a feasible benchmark in the proposed amendment to the 2020 budget.
He said, “The benchmark is so critical and so important, because once you passed the law, it becomes difficult to adjust that benchmark, and then what happens to the excess?
“We have always had problems with the Excess Crude Account, potentially an account which has no backing of the law.”
The Speaker also raised concerns about Nigeria’s debts.