kMembers of the Nigerian Senate on Wednesday
commenced debate on the Medium Term Expenditure
Framework (MTEF) presented to the upper legislative
body by President Muhammadu Buhari.
Mr. Buhari had forwarded the MTEF to the Senate on
Monday.
Under Nigerian public finance system, the MTEF is the
precursor to budget, as well as Fiscal Strategy Paper
(FSP), which details spending and revenue projections
for three years.
At the Senate plenary Wednesday, lawmakers differed
on the $38 per barrel benchmark projected as the price
of crude of oil, the mainstay of the Nigerian economy.
Leading the debate, the Deputy Senate President, Ike
Ekweremadu, asked the Senate to consider an upward
review of the crude oil benchmark for the 2016 budget.
In his opinion the $38 oil benchmark is “conservative”.
Mr. Ekweremadu therefore urged the senate to peg the
oil benchmark for the 2016 budget at $40 per barrel.
“I have looked at the projection for the oil price,” he
began, adding that “the benchmark of $38 per barrel
appears to me to be conservative. From the projection of
oil price for 2016 it is estimated that it will hover
between $40 and $45.
“I like to suggest that the senate consider an oil
benchmark of $40. I’m sure that this will help cushion
the problems we have in the states.”
However, Adamu Aliero, an All Progressives Congress
Senator from Kebbi State, opposed Mr. Ekweremadu’s
proposal, saying it was unrealistic.
“It is unrealistic. I therefore recommend we take it to
$35 per barrel,” he said.
Mr. Aliero added that it had been projected that the
global price of crude oil would fall further in 2016.
The global price of crude oil fell from $38 to $35 on Wednesday.
Also, speaking, Olalekan Adeola (APC-Lagos West), queried the indices
used by the Buhari-led cabinet in determining that “the price of oil will
increase or decrease or fall below $38″.
“We can allow it (benchmark) to be like that but we should let the
committee do a thorough job,” Mr. Adeola said.
Speaking further, he urged the Federal Government to increase borrowing
and improve budgetary share of capital expenditure.
Mr. Adeola’s view on capital expenditure vis-a-vis infrastructural
development was corroborated by Ben Bruce (PDP-Bayelsa East), who
canvassed massive borrowing to “industrialize this nation” and develop
infrastructure.
Saying “it does matter the party it comes from; what is important is that
we develop”, Mr. Bruce maintained that “this budget is good” and
commended the Finance Minister for a “good job”.
Also, he said if petrol was fully de-subsidized, the effect would be felt in
the public transport sector. He noted that “prices of goods would not
increase since diesel had always been deregulated.”
He, therefore, urged Mr. Buhari to subsidize public mass transit system,
citing instances the United States, Germany and South Africa as examples
of countries where that had been done successfully.
Dino Melaye (APC-Kogi West) also made a case for infrastructural
development.
He proposed that capital expenditure be increased to 35 per cent because
“APC promised infrastructural development”.
Peter Nwaoboshi (PDP-Delta North) drew the attention of the Senate to
alleged “hidden things” in the MTEF.
For instance, he said it should be noted that “this government has removed
subsidy on kerosene”.
Also, he said allocation to the Niger Delta amnesty programme had been
reduced.
For him, the fall-out of the Bayelsa election showed that militants still
existed.
Thus, he urged the Federal Government to jettison any plan to cut its
commitment to the amnesty programme.
He also noted the reduction of National Assembly budget from N120
billion to N115 billion.
Mr. Buhari proposed N500 billion for social welfare programme in the
2016 budget.
“The federal government will collaborate with state governments to
institute well-structured social welfare intervention programme such as
school feeding programme initiatives, conditional cash transfer to the
most vulnerable, and post National Youth Service Corps (NYSC) grant,”
the president said in a letter containing read by the Senate President,
Bukola Saraki.
“N500 billion has been provisioned in the 2016 budget as social
investments for these programmes.”
Mr. Buhari added that the interventions would start as a pilot scheme, and
that the government would work towards securing the support of donor
agencies and development partners in order to minimise potential risks.
The MTEF was later referred to the Senate Committees on Appropriations
and Finance for further legislative actions.
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