By Williams Anuku, Abuja
The Federal Executive Council (FEC)meeting presided over by President Muhammadu Buhari has projected a total budget estimate of N13.08 trillion for the 2021 fiscal year.
The budget estimates is predicated upon an oil benchmark of $40/per barrel, with proposed Capital Expenditure standing at N2.03tn.
The budget also comes with a total aggregate revenue of N7.89 trillion, including a fiscal deficit of N4.489 trillion, representing 3.64%, slightly above what is required by the Fiscal Responsibility Act of 3%.
Minister of Finance, Budget and National Planning, Zainab Ahmed gave details of fiscal bill shortly after the virtual meeting which held at the presidential villa, Abuja on Wednesday,where she noted that the total capital expenditure is projected at 29% of the aggregate expenditure.
She said, “today, the Ministry of Finance, Budget and National Planning presented to Council the proposal for the 2021 Budget. Before presenting the proposal, we also presented the performance of the 2020 Budget to July 2020.
” Just briefly, the performance of the FGN Budget as at July, for revenue, was 68%. We had a 68% revenue performance prorated to July. The performance of expenditure, on the other hand, was 92.3% and that is to say salaries were fully paid, pensions were paid, debt service was made, as well as transfers classified as statutory.
“In presenting the Budget 2020, we had to report to Council some slight changes that need to be made on MTEF 2021/2023, which has since July been sent to the National Assembly by Mr President. Specifically, the exchange rate is going to be changed from 360 that we initially presented and submitted to Council and to the National Assembly, up to 379. The reason why this is happening is due to the exchange rate movement that the CBN has put in place.
“Also, there were some slight changes on miscellaneous revenues and signature bonuses after interaction with DPR, which resulted in some increase in revenue.
“The total budget proposal that is made for 2021 is to enable us to attain a more inclusive growth and also to achieve the key objectives of government, which includes stimulating the economy, creating jobs, enhancing growth and creating infrastructural investment, also promoting manufacturing and local production.
“The budget assumptions that were presented to Council today include, one; crude oil price benchmark at $40 per barrel. Oil production at 1.86 million barrels per day. Exchange rate of N379 to US$1, GDP growth target of 3%; and five, inflation rate of 11.95%.
“We do expect that Nigeria’s economy will recover to the path of growth early in 2021, so the total aggregate revenue that is projected for the 2021 Budget is N7.89 trillion and what is unique about the 2021 Budget is that we have brought in the budgets of 60 government-owned enterprises. If you recall, in 2020 we brought in 10, now we have brought in 60.
“These 60 exclude NNPC and the Central Bank and the reason being NNPC, a national oil company, internationally national oil companies are not included in the national budget. Also, the CBN is an autonomous body. Only those two are excluded, 60 government-owned enterprises included. That is to say their revenue and all categories of expenditure are now integrated in the Budget.
“We have a total aggregate revenue of N7.89 trillion and also an aggregate expenditure of N13.08 trillion for 2021. There’s a fiscal deficit of N4.489 trillion, this represents 3.64%, slightly above what is required by the Fiscal Responsibility Act of 3% and also to report that the total capital expenditure that is projected in the Budget is 29% of the aggregate expenditure.
“This is an improvement over the 24% that we had in the 2020 Budget, but slightly below the 30% that we targeted in the economic recovery.
“Just to clarify that the 1.86 million barrels per day crude oil production includes 400,000 condensate, so we have complied with the OPEC quota, which is placed at about 1.5 million barrels per day. So the 1.46 is in meeting with the OPEC quota.
“This is important to us because as you report, if you just report the 1.86, some members of the OPEC appear to think that we are exceeding OPEC quota, whereas we are reporting oil and condensate”.