Following the presentation of the N8.16 trillion appropriation act by President Muhammadu Buhari at the National Assembly Tuesday, analysts are calling for a speedy passage of the bill, which fell below their expectations in terms of increase in capital expenditure.
The Federal Government is planning to spend N2.43 trillion on capital projects in 2018, a slight improvement of 12 per cent over N2.17 trillion budgeted in 2017. The recurrent expenditure, however, was up by 32 per cent as president Buhari said his government plans to spend N3.49 trillion in 2018, an increase over N2.64 approved in 2017.
President Buhari said a revenue of N6.61 trillion is expected in 2018 as the government projects an spending plan of N8.61 trillion of which 40.5 per cent, N3.49 trillion will go to recurrent expenditure, 28.2 per cent; N2.43 to capital expenditure, 23.3 per cent N2.01 on servicing of the country’s debt, N456 billion on statutory transfers and N22 billion to sinking fund.
Speaking on the budget, the Chief Executive of Budgit, Seun Onigbinde noted that while the proposed budget shows that the government is continuing with its policy of expanding infrastructure as well as deficit, the allotment for capital expenditure falls below expectation.
This was also the view of Dr Uche Uwaleke, Head of Department of Economics at the Nasarrawa State University. The scholar noted that he had expected more capital expenditure in education and health where more capital projects are much needed to facilitate the development of the sectors.
He, however, called for a speedy passage and release of funds to enable full implementation of the 2018 budget. Dr Uwaleke had cautioned on a repeat of what happened in 2017 where the budget was passed in June and most of the capital projects were not implemented on time.
Budgit CEO, Onigbinde, while noting that the 2018 budget is the last of the present administration before the activities of the 2019 election begin, said “a lot of Nigerians are looking forward to his budget to see if there will be an actual tangible achievement of the current administration.
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“We hope this budget is quickly passed because we have a short period of governance next year. We have a lot more to do about politicking, so before the politicking starts let’s have the budget passed so we can also factor in the procurement cycle that takes up to two to three months, we can get the projects implemented and we can actually have results to show to the electorates next year.”
The President in his speech estimates that Federal Government’s total revenue for 2018 at N6.607 trillion, which is about 30 percent more than the 2017 target. “As we pursue our goal of revenue diversification, non-oil revenues will become a larger share of total revenues. In 2018, we project oil revenues of N2.442 trillion, and non-oil as well as other revenues of N4.165 trillion.
“Non-oil and other revenue sources of N4.165 trillion, include several items including: Share of Companies Income Tax (CIT) of N794.7 billion, share of Value Added Tax (VAT) of N207.9 billion, Customs & Excise Receipts of N324.9 billion, FGN Independently Generated Revenues (IGR) of N847.9 billion, FGN’s Share of Tax Amnesty Income of N87.8 billion, and various recoveries of N512.4 billion, N710 billion as proceeds from the restructuring of government’s equity in Joint Ventures and other sundry incomes of N678.4 billion.”
The proposed N8.612 trillion of 2018 Aggregate Expenditure comprises: Recurrent Costs of N3.494 trillion; Debt Service of N2.014 trillion; Statutory Transfers of about N456 billion; Sinking Fund of N220 billion (to retire maturing bond to Local Contractors); Capital Expenditure of N2.428 trillion (excluding the capital component of Statutory Transfers).
