As the economy gropes in the aftermath of the Coronavirus pandemic and amid growing fiscal crisis, the federal government has set aside the sum of N500 billion as intervention fund against Covid-19 in the proposed 2021 budget estimate of N12.66 trillion.
Similarly, the sum of N5 billion has been earmarked as bailout for the aviation sector which is highly impacted by Covid-19.
These projected expenditures are contained in the 2021-2023 medium term expenditure framework and fiscal strategy paper presented to the National Assembly by President Mohammadu Buhari yesterday.
The budget estimate has an embedded deficit of N5.16 trillion. The budget will be financed in part by a total loan package of N4.28tn while the rest would be from internally generated revenues.
The budget proposal targets N481.41bn as statutory transfers, N5.75tn as recurrent expenditure, N3.33tn for capital expenditure and N3.12tn for debt servicing.
Other critical parameters and assumptions upon which the proposals are based are $40 as oil price benchmark, 1.86 million barrels as crude oil production per day and N360 to a dollar as exchange rate, among others.
Also included in the proposals N52bn for Public Works Programme, N60bn for maintenance of roads through direct labour across the six geopolitical zones, and N32.46bn for Social Intervention Programme.
Apart from the N4.28tn targeted from loans, the Federal Government is also proposing N205.15bn as proceeds from the privatisation of federal assets to fund the budget.
The Federal Government put inflation rate at 11.95 per cent.
The President, in a letter attached to the documents, said he submitted the proposal early to enable the National Assembly start its work on time so that the executive could present the 2021 national budget soon.
“In line with our commitment, we have worked very hard to achieve an early submission of the MTEF/FSP. This is to allow the National Assembly enough time to perform its important constitutional duty of reviewing the framework”, the president said.
“I herewith forward the 2021– 2023 MTEF/FSP as the 2021 budget of the Federal Government will be prepared based on the parameters and fiscal assumptions of the approved 2021–2023 MTEF/FSP.”
He sought the cooperation of the National Assembly for expeditious legislative action on the submission.