BREAKING: Buhari Presents N16.39trn 2022 Budget Proposal To NASS
President Muhammadu Buhari has presented the 2022 budget proposal of N16.39trn before a joint session of the National Assembly on Thursday.
The budget is titled, ‘Budget of Economic Growth and Sustainability.’
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The oil benchmark for the 2022 appropriation is $57 per barrel, while the exchange rate is N410.5 per dollar.
The budget is projected to stimulate GDP growth by 4.2 per cent, while inflation rate is put at 13 per cent.
Nigeria’s oil production will be at 1.88m barrels per day including condensates.
Budget deficit is estimated at N6.26trn, which exceeds the fiscal treasury and it’s is expected to be financed through borrowing of N5.01trn.
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“We expect the total fiscal operations of the Federal Government to result in a deficit of 6.26 trillion Naira. This represents 3.39 percent of estimated GDP, slightly above the 3 percent threshold set by the Fiscal Responsibility Act 2007. Countries around the world have to of necessity over-shoot their fiscal thresholds for the economies to survive and thrive,” Buhari said.
Revenue for the 2022 appropriation is estimated at N10.133trn of which oil revenue is N31.6trn , non-oil N2.133trn and independent revenues 1.82trn.
The revenues includes grants and aids N63.38bn as well as the reveu of the 63 government enterprises.
But President Buhari said the country’s debts are still at sustainable levels.
Buhari said subsidy on petroleum products eroded monies that should have been used for the 2021 budget.
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He said his administration has met with debt service obligations despite revenue challenges.
According to the President, progress is being made on the country’s rail projects, adding that arrangements have been put in place to complete the Lagos-Ibadan rail line.
On power projects, the President said progress is being made to achieve optimal power supply by 2025.
He said the passage of the Petroleum Industry Act should result in the rationalisation of expenditure and improve investments in the oil sector.
Buhari had earlier presented a revised 2022-2024 Medium Term Expenditure (MTEF) and Fiscal Strategy Paper (FSP) to the upper legislative chamber for approval.
The MTEF and the FSP was first passed by the Senate on September 22 with the approval of expenditure of N13.98trn for 2022.
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BREAKDOWN OF THE 2022 REVENUE ESTIMATES
PARAMETERS AND FISCAL ASSUMPTIONS
Distinguished Members of the National Assembly, the 2022 to 2024 Medium Term Expenditure Framework and Fiscal Strategy Paper sets out the parameters for the 2022 Budget as follows:
- a. Conservative oil price benchmark of 57 US Dollars per barrel;
- b. Daily oil production estimate of 1.88 million barrels (inclusive of Condensates of 300,000 to 400,000 barrels per day);
- c. Exchange rate of four 410.15 per US Dollar; and
- d. Projected GDP growth rate of 4.2 percent and 13 percent inflation rate.
Based on these fiscal assumptions and parameters, total federally-collectible revenue is estimated at 17.70 trillion Naira in 2022.
Total federally distributable revenue is estimated at 12.72 trillion Naira in 2022 while total revenue available to fund the 2022 Federal Budget is estimated at 10.13 trillion Naira. This includes Grants and Aid of 63.38 billion Naira, as well as the revenues of 63 Government-Owned Enterprises.
Oil revenue is projected at 3.16 trillion, Non-oil taxes are estimated at 2.13 trillion Naira and FGN Independent revenues are projected to be 1.82 trillion Naira.
PLANNED 2022 EXPENDITURE
A total expenditure of sixteen point three-nine (16.39) trillion Naira is proposed for the Federal Government in 2022. The proposed expenditure comprises:
- a. Statutory Transfers of 768.28 billion Naira;
- b. Non-debt Recurrent Costs of 6.83 trillion;
- c. Personnel Costs of 4.11 trillion Naira;
- d. Pensions, Gratuities and Retirees’ Benefits 577.0 billion Naira;
- e. Overheads of 792.39 billion Naira;
- f. Capital Expenditure of 5.35 trillion Naira, including the capital component of Statutory Transfers;
- g. Debt Service of 3.61 trillion Naira; and
- h. Sinking Fund of 292.71 billion Naira to retire certain maturing bonds.
