Amid opposition, Senate okays N4 trillion loan to fund 2021 budget - SALIENT TIMES ONLINE

Amid opposition, Senate okays N4 trillion loan to fund 2021 budget

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By Olubiyi Obasa




Ignoring protests from some lawmakers, the Senate has given President Muhammadu Buhari the green light to borrow N4.28 trillion to fund the 2021 N13.08 trillion budget fraught with a N5.19 trillion deficit.


Approving the 2021-2023 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP), the Red Chamber also okayed N3.12 trillion for debt servicing, while retaining N7.89 trillion for the Federal Government in the 2021 fiscal year.

The approvals were made just as the upper chamber announced that of the N2.4 trillion budgeted for expenditure in the current 2020 budget, only N378.85 billion had been released.

It said the 2021 budget would be made up of total recurrent (non-debt) expenditure of N5.66 trillion.

The breakdown includes personnel cost (MDAs) of N3.05 trillion; capital expenditure (exclusive of transfers) of N3.58 trillion; Special Intervention (recurrent) amounting to N350 billion and Special intervention (capital) of N20 billion.

The proposed appropriation bill, according to the legislators, would be based on key assumptions, including 1.86 mbpd daily crude oil production with a benchmark of $40 per barrel.

An exchange rate of N379/$ was equally sanctioned, while the projected GDP growth rate of three per cent and a predicted inflation rate of 11.95 per cent were also agreed upon.

Before the approvals, a number of senators faulted the economic implications of the budgetary proposals.

Senator Betty Apiafi (PDP: Rivers), for instance, held that the chamber ought to have reviewed the performance of the 2020 budget before approving the MTEF.

In sanctioning the document, the Senate also resolved to amend the Fiscal Responsibility Act (FRA, 2007) to improve revenue generation and remittance capacity of agencies of the Federal Government.

It directed relevant standing committees to immediately review the laws guiding the operations of all revenue-generating agencies, even as government was advised to streamline stamp duty collections by the ministries, departments and agencies (MDAs) to eliminate loss.

SIMILARLY, the chamber said only those directly involved in budget preparation that should accompany the President for today’s presentation of the appropriation bill before the joint session of the National Assembly.

Senate President, Ahmed Lawan, who gave the directive at plenary, said the one-hour event would be observed in strict compliance with extant COVID-19 protocols

“This time around because of the COVID-19 pandemic, we have made arrangements to observe social distancing in the chamber,” he clarified.

He urged lawmakers to wear face masks, adding: “We are also going to abridge the entire event.”

On the duration of the session, he stated: “The entire event will last for just an hour. From the entry of the President into the chamber to addresses and the presentation and laying, it will be just an hour event.

“This is done so that we would be able to comply with the COVID-19 protocols.”

Lawan added: “Mr. President, this time around, will not be accompanied by many people.

“Only a few people – that are key and relevant to the budget – that will accompany Mr. President into the chamber

“I think by the arrangement, those of them that have little to do with the budget will join virtually.”