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Nigeria’s earnings down by 40% - SGF

Secretary to the Government of the Federation, Babachir Lawal, Wednesday, disclosed that Nigeria’s projected earnings in the 2016 budget has dropped by 40 per cent as he told political office holders to adjust themselves to the reality. This was even as he said the country’s oil production capacity had risen to 1.7 million barrels per day from its initial 800,000 barrels. Appearing before Senate Ethics Committee Mr Lawal spoke when he appeared before the joint Senate Committee on Ethics, Privileges and Public Petitions, Finance and Appropriation, to defend the statement credited to him to the effect that the administration would not be able to implement constituency projects captured in the 2016 budget. But he told the Senator Samuel Anyanwu-led joint committee that the statement was his opinion and not the position of the Federal Government.



To this end, the Senate fumed, warning that non- implementation of constituency projects was a violation of the Appropriation Act that required necessary sanctions. Members of the Committee insisted that the projects, which only constituted 0.3 per cent of the money in the 2016 budget, must be fully implemented without any part unattended to. The SGF, who owned up to the statement, said he was not emphatic on his statement, saying it was based on the dwindling resources available to the government. This morning, for example, the Minister of Budget said basically the revenue profile of the country is that we are now earning between 50 to 60 per cent of our projected earnings, meaning that there might be a loss of 40 per cent of the money appropriated for in the budget.



“Forty per cent is quite a significant amount, not only oil,” which he said would affect all branches of government, including the National Assembly. “Oil export has fallen drastically but thank God for little mercies that the price has risen a bit. But it has started coming down again.” Drop in revenue Noting that drop in revenue was bound to affect government’s projected expenditure, he said: “When constituency projects are appropriated along with other projects, it’s the duty of the executive to implement. As my statement quoted, there is one key word in a statement which is ‘might.’ “In the statement made by me to this effect, I said, of course, if the revenue profile of the government improves, we will implement all projects in the Appropriation Act. I want to be truthful on this.



“We are all aware that you as legislators predicated the revenue of the government, for example, at 2.2 million barrels per day. I’m sure that all of you here are aware that at one time, oil production had dwindled to almost 800,000 barrels per day. The consequence of this, of course, is dwindling revenue base of the government, subsequent upon which there will be the inability to finance projects appropriated for by the executive. Now, it is important for government and the politicians to prepare the minds of the electorate that there are challenges ahead, prepare their minds that there might be some challenges ahead in implementing the budget.



“You are aware that the government based its budget on the principle of zero budgeting this year. That is to say that we will budget for only capital projects that are key to the mandate of the government, that the government considers very important. First of all, restoring security in the land, second, providing employment to Nigerians and possibly diversifying to other non-oil sectors of the economy. For the executive arm of government, this was the focus and, therefore, all the MDAs were ordered to comply with this principle. Any project that government did not feel was key was not included in that budget. When the budget was concluded, the Minister of Budget and Planning issued circulars to MDAs to submit a list of projects that are considered key to their mandate, in view of the dwindling resources.”



He explained that unlike in the past when funds were being released for execution of capital projects on a quarterly basis, the trend had changed in the new dispensation. "Hitherto, the practice had been that government would release funds to MDAs on quarterly basis. This time, government’s position is that funds would be released to key projects prioritized according to the level of importance and significance, in line with the key mandate of the government. Let me illustrate why implementation of some projects would be very difficult in the light of the dwindling resources.



Government has a duty to communicate to the citizens, whether or not that information is going to be palatable to the legislature or even the electorate. “So, Distinguished Senators, yes, I made the statement. He told the senators not to claim a right to constituency projects, a development that made all the 20 senators at the session charged at him with fury. It does appear that the National Assembly or the senators here present have appropriated for themselves the ownership of constituency projects. It is not for the National Assembly alone. Constituency projects, as I have pointed out, are not for you alone, they are from the executive,” he said.



Speaking at the session, Senator Dino Melaye, APC, Kogi West, said: “I would say that the issue of Appropriation has been over emphasized that it is an Act of the Parliament. But I want to inform and educate the SGF that the under-implementation, the over-implementation, the non-implementation of the Appropriation Act amounts to a breach of the law. And this breach of the law has provision for sanction. The Parliament has oversight functions over all the MDAs and that responsibility, to a large extent must be exercised to the fullest including even the appropriation of projects. You must understand that every MDA in this country including the office of the Secretary to the Government of the Federation. We have oversight responsibilities over that office and what you do in that office.



“The budget of the constituency projects is just 0.3 per cent of the entire capital projects in the 2016 budget, so I do not understand why the complaints.” On his part, Senator Peter Nwaoboshi, PDP, Delta North, noted that besides the President, his vice and the legislators who are elected, the SGF and others were all employees of the government. He called for harmonious working relationship between the executive and the legislature. Almost all the senators who spoke at the session insisted that all the constituency projects must be implemented to the latter, warning that violation would constitute offence which punishment is appropriate sanctions.


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