EconomyNews

Buhari Presents 2022 Budget With N6.26tr Deficit to N’Assembly

President Muhammadu Buhari, on Thursday presented the Appropriations Bill 2022 tagged “Budget of Economic Growth and Sustainability,” with a proposal to spend N16.39tr in the 2022 fiscal year to a joint session attended by members of both chambers of the National Assembly.

President Buhari who arrived the House of Representatives Chamber where the joint session held at about 12:04pm, while the presentation lasted for an hour ended at 1:05pm, emphasised that the expected total fiscal operations of the Federal Government would result in a deficit of N6.26tr, representing 3.39 percent of estimated GDP, which, according to him, is slightly above the 3 percent threshold set by the Fiscal Responsibility Act 2007.

He said allocations to MDAs in the budget were guided by the strategic objectives of the National Development Plan of 2021-2025, which includes diversifying the economy with robust MSME growth; investing in critical infrastructure; strengthening security and ensuring good governance; enabling a vibrant, educated and healthy populace; reducing poverty; and minimizing regional, economic and social disparities.

He added that defence and internal security would continue to be top priority for his administration, as part of a firm commitment “to the security of life, property and investment nationwide.

“We will continue to ensure that our gallant men and women in the armed forces, police and paramilitary units are properly equipped, remunerated and well-motivated” President Buhari said.

On parameters and fiscal assumptions of the 2022 Appropriations Bill, he explained that same was based on the 2022-2024 Medium Term Expenditure Framework and Fiscal Strategy Paper.

The budget is based on oil price benchmark pegged at US$57 per barrel; oil production estimate at 1.88 million barrels (inclusive of Condensates of 300,000 to 400,000 barrels per day); Exchange rate at N410.15 per US Dollar; and Projected GDP growth rate at 4.2 percent and 13 percent inflation rate.

He stated that based on these fiscal assumptions and parameters, total federally-collectible revenue was estimated at N17.7tr in 2022.

Buhari explained further that while total federally distributable revenue is estimated at N12.72tr, total revenue available to fund the 2022 Federal Budget was estimated at N10.13tr, an amount which includes Grants and Aid of N63.38bn, as well as the revenues of 63 Government-Owned Enterprises.

According to him, Oil revenue was projected at N3.16tr; Non-oil taxes, N2.13tr; and FGN Independent revenues projected at N1.82tr. 

He said out of the total expenditure of N16.39tr proposed for the Federal Government in 2022, N768.28 is for Statutory Transfers; N6.83trillion is for Non-debt Recurrent Costs; and N4.11 trillion for Personnel Costs.

Others are N577bn for Pensions, Gratuities and Retirees’ Benefits; N792.39bn for Overheads; N5.35tr for Capital Expenditure, including capital component of statutory transfers; N3.61tr for Debt Service; and N292.71bn for Sinking Fund to retire certain maturing bonds.

In addition, the President disclosed that efforts were being made by his administration to partly support the realization of fiscal projections by reviewing the current tax and fiscal laws to produce a draft Finance Bill 2022.

“It is our intention that once ongoing consultations are completed, the Finance Bill would be submitted to the National Assembly to be considered alongside the 2022 Appropriation Bill”, he announced.

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