The query raised by the National Assembly over the poor handling of
the projected expenditure of the 2017 budget has created tension among
members of the executive arm of government.
The query has set off a
number of chain reactions within the executive, especially among
ministers and staff of the ministries of Finance, Budget Office and
Petroleum Resources. Larry oboh's blog gathered that there had been
exchanges of memos among the ministers and heads of departments since
Wednesday, following a directive by the Presidency to all officials
involved in the budget data collation.
The memos called for a
revisit of the issues raised by the Senate before the December 1
deadline for formal presentation of the detailed budget by the President
to the National Assembly.
The upper legislature, in their plenary
session last Monday insisted that the executive replace the document
forwarded to the National Assembly, containing the 2017-2019 Medium Term
Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP), with
factually-backed paper, or else no further debate would hold on the 2017
budget proposal.
It will be recalled that since October when
President Muhamadu Buhari forwarded the budget documents to the law
makers, criticisms have been trailing it. The main point of
disagreement is on bench-marking crude oil price at $42.5 per barrel and
a production output of 2.2 million barrels per day (bpd), as well as
pegging the exchange rate at N297 to the dollar, which officially goes
for N315 per dollar.
Experts have argued that given the instability in the oil market,
which has seen a fluctuation in the price of Brent oil hovering around
$40.5 to $43.8 per barrel; it amounts to being over ambitious for the
2017 budget to be based on selling oil at $42.5, as contained in the
MTEF and FSP document. They also faulted the exchange rate
projection as being speculative given the reality that dollar scarcity
still persists in the country.
But in apparent admission of the
error on the speculative oil price in the international market, the
Minister of State, Petroleum Resources, Ibe Kachukwu, was quoted by
foreign media as saying that the uncertainty hovering around the sector
was informed by uncertainty surrounding the outcome of the much expected
OPEC November 30 meeting in Algeria. He conceded that there might
be a review of the oil price benchmark as contained in the budget
before Nigeria’s National Assembly. “There is the need to tread
cautiously on the issue since the outcome of OPEC resolution on
production quotas to members is still being expected to turn out
positive. “If this fails to materialize, the price of crude will fall blow expectation of all,” Kachukwu said.
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