From Juliana Taiwo-Obalonye, Abuja
The Federal Government yesterday said it will today commence injection of funds into the economy following the signing of the 2016 budget by President Muhammadu Buhari.
The Minister of Budget and National Planning, Udo Udoma, disclosed this during the budget break down in Abuja attended by Ministries, Departments and Agencies (MDAs) as well as members of civil societies and the diplomatic community.
He said the 2016 budget was deliberately prepared to prevent the deficiencies of 2015 budget, resulting from the failure to achieve projected oil production levels due to pipeline vandalisation and oil theft. He has also said that it will rely on non-oil revenue to fund the 2016 budget.
Udoma said, “by tomorrow, some releases would be made. We are ready to start releases as far as the budget is concerned,” adding that his Ministry intends to work closely with the Federal Ministry of Finance to ensure cash backing of the capital projects.
He said the 2016 budget will run concurrently with 2017 budget until May next year as government intends to return to the January to December financial year.
“We intend to take the budget to where it ought to be; the January to December financial year, which is much better for implementation. So for the next year’s budget we intend to get it to the National Assembly so that it is passed by the year end,” he said.
Udoma said the 2016 budget will focus on six strategic areas including, economic diversification, critical infrastructure and reforms in the oil and gas sector. Others include ease of doing business, policy environment, national security, and governance and social investment.
The Budget and Planning Minister said, “the strategic implementation plan forms the basis for the preparation and implementation of the 2016 budget, as it documents the key short-term priorities of the incumbent administration to place the economy on this upward trajectory as it is repositioned for change, inclusive growth and sustainable development.”
A breakdown of the 2016 budget projections shows that the fiscal document envisages a net distributable revenue of N5.72 trillion comprising main Federation Account revenue of N4.303 trillion and N1.416 trillion from the value added tax pool account.
Of the distributable revenue, net oil receipts amount to N1.48 trillion or 25 per cent while net non-oil revenue accounts for the balance of N4.22 trillion or 75 per cent. The states and local governments share of the distributable pool amount to N3.24 trillion while the Federal Government will receive N2.48 trillion.
Federal Government’s budgeted revenue is projected at N3.855trillion largely contributed by the Internally Generated Revenue (IGR) of N1.51 trillion, which is 35% increase over the N2.855 trillion for the 2015 budget.
Growth in the Federal Government’s revenue is mainly to be derived from the growth in non-oil resources from corporate tax, VAT and dividends from government corporations and independent revenue.
A projection of N1.88 trillion was made on corporate taxes in the 2016 budget as against N1.42 trillion in 2015, and VAT collection of N1.48 trillion in 2016 from N1.28 trillion last year.
Provisions for expenditure of the N6.06 trillion 2016 budget shows a 35 per cent increase over the 2015 budget of N5.067 trillion.
Statutory transfer (inclusive of N157 billion capital component is put at N352.37 billion, debt servicing including sinking fund of N1.48 trillion, recurrent (non debt) expenditure is put at N2.65 trillion.
Capital expenditure (excluding share of capital in statutory transfers) is put at N1.59 trillion while the capital expenditure (including share of capital expenditure in statutory transfer) is put at N1.7 trillion.