Finance

December 25, 2018

We spent ECA on buying Super Tucano jets, military equipment — Ahmed

Stakeholders may compel FG to raise subsidy removal funding

Minister of Finance, Budget and National Planning, Zainab Ahmed

lSays FG has disbursed $5.4bn of Paris Club refund to states

By Emma Ujah, Abuja Bureau Chief

ABUJA—Funds in Excess Crude Account, ECA, were spent on Super Tucano jets and other military equipment, Minister of Finance, Mrs. Zainab Ahmed, has explained.

Zainab Ahmed

There have been concerns about the depletion of ECA, following the disclosure, last week, that it was depleted from over $2 billion to about $631.5 million within one month.

Addressing newsmen in Abuja, yesterday, the minister disclosed that the withdrawal of the $1 billion approved for the military to fight insurgency, in addition to the Paris Club Refund to state governments, were responsible for the sudden reduction in the account.

She said:  “The ECA as at January 2018 had a balance of about $2.45 billion. There were a number of inflows into that account during the course of the year, bringing the total balance to about $3.5 billion as at October, 2018

“We had approval from the NEC to use $1 billion for the needs of the security services and so far, I am sure you all know we have paid for the Super Tucano jets and following that, we have also paid for some critical military equipment, which means that most of the $1 billion has been utilised to date.

“We have also got instructions from Mr. President, with the support of NEC, to pay part of the debt that is being owed by the Federal Government to the states in respect of the Paris Club.  That has also been paid from that account. So, to date we have a balance of $631.445 million.”

Excess Crude Account crashes to $631m

New taxes targeting luxury goods

On the planned taxes, the minister said there would only be an introduction of taxes on luxury goods and that rates of existing taxes would not be increased, adding that if anything, there could be a reduction in rates of taxes affecting small businesses.

She said:  “We are not increasing tax rates. We are increasing tax collection by expanding tax base but this is a decision that will involve the economic management team, FEC and NASS. If anything, we are likely to reduce taxes for the lower groups of businesses, which are the SMEs.

“But we are doing everything we can to make sure that high net-worth individuals are found out and that they pay the right level of taxes that they are supposed to pay.”

Fayose wasted Ekiti’s N18bn Paris Club refund — Fayemi

Mrs. Ahmed described the nation’s fiscal outlook as challenging and as such decided to prioritise revenue generation, going forward.

There‘ll be consequences for MDAs that fund election

Responding to journalists’ concerns that public funds could be channelled to election financing through Federal Ministries, Departments and Agencies, MDAs, the minister said President Muhammadu Buhari’s administration would not tolerate it and that there would be consequences for any such diversion.

She said: “Let me remind you that this is the administration of President Muhammadu Buhari. The President has directed that every MDA should stay focused on its works.

“There will be consequences for any agency that gives out money for the purposes of funding elections.”

The minister also disclosed that $5.4 billion Paris Club refund had so far been disbursed to states by the Federal Government.

According to her, the Federal Government has taken steps on debts repayment, as a total of $5.4 billion has been paid for Paris Club refund, $1.9 billion as export expansion grant and $6.8billion payment for cash call obligation.

The $5.4billion paid as settlement of the Paris Club refund, when converted based on the N305 per dollar official exchange rate of the Central Bank of Nigeria is about N1.65trillion.

The Paris Club Refund was released to states in phases based on some conditions.

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