By Soni Daniel
The Minister of Budget and National Planning, Senator Udoma Udo Udoma and his Finance counterpart, Mrs Kemi Adeosun were at the Senate today to interact with members of the Senate Committee on Appreciation over the performance of the 2016 Budget.

Udoma

Highlights

Budget performance slow due to revenue shortfalls which is as a result of the militancy in the Niger Delta Region. Although global oil price against budget benchmark is favourable, production shortfall disruption the smooth execution of the budget.

Notwithstanding, salaries of Federal Government paid up to date

Minister Finance, Mrs. Kemi Adeosun, and Budget and National Planning Minister, Senator Udoma Udo Udoma

Overheads disbursed in full up to August 2016

Capital releases is affected by revenue shortfall, but releases have consistently been made to those areas whose activities have the capacity of helping the growth of the economy and creating jobs. Particular emphasis is on infrastructure, agriculture and other areas with high job creation potentials. The government adopted targeted releases focusing on those areas.

Government has started releasing fund for social intervention projects

Releases so far

1. Capital projects N753,633,667.464 (all cash backed)

2. Personnel costs N1,299,925,394,317

3. Pension and Gratuity N142,310,883,893

4. Overheads N108,498,117,270

5. Service-wide vote N135,488,915,101

Total releases as at September N2,439,856,987,045

The total figure excludes debt servicing, which is being done regularly as at when due

All payment warrants and cash backing has been fully aligned; which means all warrants are cash backed. That is the current policy, that all warrants must be cash-backed.

Before now releases were done on pari-parsu basis, but now government adopted the targeted system which is on the basis of priority – based on request and activity levels; but for overheads, even though releases are also on pari-parsu basis, it has been constrained by revenue shortfall. Overheads have been released only up to August, that is why there is a shortage.

Adeosun

Procurement process requires the intervention of the National Assembly because it slows down the process of getting things done speedily particularly in this troubled times that certain activities need to be fast-tracked. She said the Procurement Act is good for normal times but the time we are in are abnormal times

Informed that more than 700 companies which were hitherto not in the tax next have been dragged in and there are high expectations that the tax revenue will increase significantly going forward

All local borrowings have been undertaken – N980 billion (local) More than N900 billion (foreign)

Negotiations still on course on foreign loans and some are nearing completion stages

Loans are strictly meant for capital projects and some are tied to specific projects that have the capacity to reflate the economy and generate revenue to repay the loans. “We are on course with the borrowing plans and once approval is given by the national Assembly, result of the efforts will begin to show

Receiving of loot is an on-going process, a significant chunk of the loot are domiciled in other jurisdictions. Much of it still tied up in legal processes in other jurisdictions. Money comes in almost monthly from the local loots

Received properties are being converted to government offices. Some of the properties include hotels and luxury apartments. She said government decided not to put those properties on sale because they will not attract the right prices now that the economy is on a downward curve, so it decided to put them to other functional uses to avoid depreciation and dilapidation. Government offices in rented property are being relocated to the recovered properties.

Recovered vehicles are being distributed to some government establishment in need while the high value cars are kept in the Protocol Unit for foreign visitors use. Government decided to put the cars to immediate use as they are being recovered from looters so that they do not disappear in custody or get vandalized or depreciate in value after a long regime of packing

Chairman Senate Committee on Appropriation Senator Danjuma Goje

The interaction is in continuation of our oversight function to ensure that the 2016 Budget is fully and faithfully implemented

If what you are telling us here and what we have seen in the reports before us here is true, then we can say that you have done very well. it is different from what we have been hearing from the media. If all the releases have been cash-backed as you have said, then we are making progress; and from what you have told us here, also with the assurance that something is being done about the Niger Delta situation to bring back production levels to 2.2 million barrels a day, there is every likelihood that the 2016 Budget may be substantially implemented. This is good news for our economy.