The Federal Government on Monday proposed a budget estimate of N6 trillion for 2016, with an oil bench mark of 38 dollars per barrel.
Briefing State House Correspondents after an emergency meeting of the Federal Executive Council, (FEC), presided by President Muhammadu Buhari at the Presidential Villa, Abuja, the Minister of Budget and National Planning, Sen. Udoma Udo Udoma, said that the Medium Term Expenditure Framework, MTEF, has also been approved and submitted to the National Assembly.
He said, “At today’s council, council approved the Medium Term Expenditure Framework.
“This sets out the policies of government over the next three years. It sets out the fundamental economic underpinning of the budget.
“The highlights are as follows. We project and we are working with 38 dollars crude oil price.
“We consider that to be very conservative but because of the uncertainties we feel that we should start with a conservative crude oil price.
“We also are working with 2.2 million barrels per day production.
“We believe it is achievable, particularly because with the passage of the Petroleum Industry Bill which we are working to achieve, we believe that that is actually a modest figure; that we should be able to produce something higher than that.
“And so, next year we are looking at an expansionist budget. We are looking at a budget that will be N1 trillion more than last year.
“So we are looking at a budget of about N6 trillion. Last year’s budget, including the supplementary, was about N5 trillion.
“Most of the increases, all the increases actually will be spent on capital because there is the need to increase the capital spend because of our infrastructure issues we have to address.’’
According to him, the plan will be submitted to the National Assembly and a feedback expected after which the budget will be finalised with all the details embedded.
On how the budget will be funded, the minister said that the funding would come from earnings from the non-oil sector.
“We are looking at trying to get more money from the various government agencies, policing their collection and trying to get more money from them.
“We will also look at keeping down our recurrent budget, that means we are looking at savings that we can make from overheads.
“We will also look at the deficiency from our revenue collecting agencies like the FIRS, in terms of companies income tax; in terms of VAT, and then the difference we will have to borrow.
“But the level of borrowing that we anticipate and we are projecting will be well within the maximum that we allow, which is three per cent of the GDP, because we want a prudent budget; we want a credible budget,” he added.