• Sign Revised 2020 budget Friday
• FG Achieves 56% Of 5-Month Revenue Target
• Debt Servicing Gulps N1.25tr

Mrs. Zainab Shamsuna Ahmed, Nigeria’s Minister of Finance, Budget and National Planning, on Thursday said President Muhammadu Buhari has directed her Ministry to expedite action on the 2021 budget estimates which he hopes to present to the National Assembly by the end of September.

Speaking at a meeting with the leadership of the National Assembly on plans to submit the 2021-2023 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP), she also disclosed that the President will on Friday sign the revised N10.8tr revised 2020 budget passed by the National Assembly in June into law.

The Minister, who briefed principal officers of the Senate and House of Representatives led by the Senate President, Ahmad Lawan, and the Speaker, Femi Gbajabiamila, said the Buhari administration is committed to keeping strictly with the January – December budget cycle.

Ahmed explained, “this for us is a journey towards ensuring that the progress that we have made as a collective to return the fiscal year to January – December is maintained for the 2021 budget as well, according to a statement by Ezrel Tabiowo, Special Assistant (Press) to President of the Senate.

“The President has directed that we must deliver the budget to the National Assembly by the end of September,” she stressed, putting the Federal Government’s retained revenue between January and May 2020, at N1.48tr, representing 56% of target.

A breakdown of the sum generated as revenue showed that oil accounted for N701.6bn, or 47.4%; non-oil tax, N439.32bn or 29.68%; Companies Income Tax (CIT) and Value Added Tax (VAT) collections, N213.24bn or 14.4%; and N68.09bn, 0.046%; and Customs collection N158bn, or 10.67% respectively.

“Other revenues amounted to N339.51bn, of which Independent revenues was N80.22bn. Recoveries and Stamp duty collected during the period are yet to be booked in the fiscal accounts,” Ahmed said.

On expenditure performance for the same period (January – May 2020), she disclosed that N1.25tr was expended for debt service; and N1.32tr for Personnel cost, including Pensions.

According to the Finance Minister, as at the end of May 2020, only N253.33 billion had been released for capital expenditure.

Ahmed while giving underlying assumptions driving the macro-economic parameters and targets of the 2021 – 2023 Medium Term Expenditure Framework said same was “revised in line with the emergent realities.”

She stated that the Oil Price Benchmark for the 2021 fiscal year was pegged at USD$35; and USD$40 for 2022 and 2023, respectively.

Oil production (mbpd) was placed at 1.86 for 2021, 2.09 for 2022, and 2.38 for the 2022 fiscal year; while the Exchange Rate remains at N360 to USD$1.

Ahmed stressed that, “although Nigeria’s total production capacity is 2.5m barrels per day, current crude production is about 1.4m barrels per day – in compliance with the Organization of the Petroleum Exporting Countries’ production quota – and an additional 300,000 barrels per day of condensates, totaling about 1.7mbpd.”

She added that while the World Bank forecasts that crude oil prices will rise gradually from an average of USD$42 per barrel in 2021 to USD$44.5 per barrel in 2022; and USD$47pb in 2023, it is also expected that Brent crude oil prices may average $41 per barrel during the second half of 2020 and $50pb during 2021, climbing as high as $53pb by the end of next year.

“The nominal Gross Domestic Product (GDP) is expected to increase from N130,836.1 billion in 2020 to N132,125.4 billion in 2021 and then up to N138,415.8 billion in 2023,” Ahmed said.

Earlier, the Senate President in his welcome remarks said he meeting was “at the instance of the Honourable Minister of Finance, Budget and National Planning, and the main purpose of the meeting is for the Minister to brief the leadership of the National Assembly on the 2021 – 2023 Medium Term Expenditure Framework and Fiscal Strategy Paper.

“Therefore, it will not be wrong to say that the journey to the presentation of the 2021 budget estimates by the Executive arm of Government has started in earnest.

“It is our expectation in the National Assembly that this journey will lead to the presentation or laying of the budget estimates by the President before the end of September by the grace of God.”