.Targets N2.01trn from oil sector, Non-oil revenue N1.49trn
.To spend N198bn on Power sector
Nigeria President Mohammadu Buhari has said that N4.98 trillion or 3.57 percent of the 2021 projected N10.81 trillion in expenditure is to be financed by borrowing, out of aggregate revenue of N5.84 trillion expected.
Presenting the 2021 Federal Budget Proposals, tagged Budget of Economic Recovery and Resilience, to the Joint Session of the National Assembly in Abuja on Thursday, the President said oil revenue is projected at N2.01 trillion and Non-oil revenue is estimated at N1.49 trillion.
“In 2020, average daily oil production was 1.88 mbpd up to June, as against the revised estimate of 1.80 mbpd for the entire year. However, the market price of Bonny Light crude averaged 40.79 US Dollars per barrel, significantly higher than the revised benchmark price of 28 US Dollars.
“As at July 2020, the Federal Government’s actual revenue available for the budget was N2.10 trillion. This revenue performance was only 68 percent of our pro-rated target in the revised 2020 budget. At N992.45 billion, oil revenue performed well above our budget target, by 168 percent. Non-oil tax revenues totalled N692.83 billion, which was 73 percent of the revised target.
On the expenditure side, as at end of July 2020, a total of N5.37 trillion had been spent as against the pro-rated expenditure of N5.82 trillion. Accordingly, the deficit was N3.27 trillion. This represents 66 percent of the revised budgeted deficit for the full year”.
Other parameters for the 2021 Budget, according to the President include a benchmark oil price of $40 per barrel; daily oil production estimate of 1.86 million barrels (inclusive of Condensates of 300,000 to 400,000 barrels per day), exchange rate of N379 per US Dollar; and GDP growth projected at 3.0 percent and inflation closing at 11.95 percent.
He said a the Finance Bill 2020 would soon be forwarded to the National Assembly by the Minister of Finance, Budget and National Planning, their kind consideration and passage into law, shortly after today’s 2021 Budget presentation.
“The Finance Bill is to support the realization of our 2021 revenue projections, adopt appropriate counter-cyclical fiscal policies and enhance the efficiency of fiscal incentives. As you will observe, the format of the 2021 Appropriation Bill has been modified to include budgeted revenues, no matter how small, for each MDA, to focus on internal revenue generation. Accordingly, I implore you to pay as much attention to the revenue side as you do to the expenditure side”, he urged the legislators.
Buhari said an aggregate expenditure of N13.08 trillion is proposed for the Federal Government in 2021. This includes N1.35 trillion spending by Government-Owned Enterprises and Grants and Aid funded expenditures of N354.85 billion. For 2021, the proposed N13.08 trillion expenditure comprises: Non-debt Recurrent Costs of N5.65 trillion; Personnel Costs of N3.76 trillion;Pensions, Gratuities and Retirees’ Benefits of N501.19 billion; Overheads of N625.50 billion; Debt Service of N3.124 trillion; Statutory Transfers of N484.49 billion; as well as Sinking Fund of N220 billion (to retire certain maturing bonds).
Power: N198 billion (inclusive of N150 billion for the Power Sector Recovery Plan); Key projects for implementation in the Power sector include several Rural Electrification Projects in the 36 States and Abuja, Rural Electrification Access Programme in Federal Universities, the Kaduna LPFO Gas Fired power Plant, the Mambilla Hydro Power Project and the Zungeru Hydropower Project.