Preliminary works for 2017 budget have begun in earnest going by the declaration by the Minister of Budget and National Planning , Senator Udoma Udo Udoma, that the 2017-2019 Medium Term Expenditure Framework (MEFT) will be ready for submission to the National Assembly by October.
Udoma gave insight into the 2017 budget yesterday in Abuja during a Stakeholders’ Consultative Forum with Civil Society Groups and organised private sector on the 2017-2019 METF. He said: “Demand and supply factors are expected to keep crude oil prices low in the medium term compared to the period prior to mid-2014.
We are considering a conservative oil price benchmark of $42.5 per barrel for 2017, $45 per barrel in 2018 and $50 per barrel in 2019. “We estimate oil production to be 2.2million barrel per day for 2017 , 2.3million barrel per day in 2018 and 2.4million barrel per day for 2019. We have pegged exchange rate for 2017, 2018 and 2019 at N290 to a dollar. ”
While disclosing that recovered looted funds would be used in funding part of the 2017 budget, he pointed out that N2.1trillion had so far been expended out of the N6.06trillion budgeted for 2016. He, however, added that only N253billion out of the N1.8trillion earmarked for capital projects had been spent so far. Government , he said, would continue in its effort to diversify its revenue sources to non -oil sectors.
“A significant increase in non oil revenue receipts is projected due to a gradually recovering domestic economy and government ’s expected improvement in Federal Inland Revenue Service (FIRS ) tax collection efforts. Company Income Tax is projected to increase from N1.79trillion in 2016 to over N1.86trillion in 2017 and beyond while Value Added Tax (VAT) collections is to increase by about 42.4 percent in 2017. “Operating surpluses projection have been moderated downwards for 2017 and thereafter a modest growth.
Customs collections are projected to moderate downwards for 2017 and thereafter a modest growth,” he said. Also speaking, Lead Director, Centre for Social Justice, Mr. Eze Onyepere, said government should learn and build on the mistakes of the 2016 budget.
“We should draw lessons from the mistakes of the last budget. We have all seen that the revenue projections for 2016 were over optimistic. This is why we are finding it difficult to get money to fund the budget, especially the capital expenditure. “ In 2017 onwards, we should be more empirical in our revenue forecast.
Let it be more realistic so that there won’t be a deviation of more than minus or plus five per cent. This is because if we have more money, we can do supplementary budgets rather than have an overly optimistic revenue projection and, at the end of the day, we are not able to fund our budget, ” he said. In his contribution, Governance Programme Manager Actionaid Nigeria, Mr. Obo Effanga, reminded the government of the limited time they had to fulfill promises.
“This administration is a four year period and one year has gone already and even the government had admitted that the last year will be given to politics, so effectively they have just two years left. And we are preparing the budget for one of the two years remaining. So, if we don ’t make sure that this works very well, it means that we can only look up to 2018 ,” he said.