President Muhammadu Buhari is asking the National Assembly for approval to
borrow the sum $29.960 billion externally to execute key infrastructure
projects across the country between 2016 and 2018.
In separate letters to Senate President, Bukola Saraki, and Speaker, House
of Representatives, Yakubu Dogara, also requested for approval to vire
N180 billion of the N500 billion appropriated for Special Intervention
Programme as in 2016 budget, to enable the government finance other key
projects.
Titled, Request for Virement of Funds Appropriated for Special
Intervention (Recurrent) and Special Intervention (Capital) for the
funding of critical recurrent and capital items and Request for Approval
of Federal Government 2016 – 2018 External Borrowing (Rolling) Plan,the
two letters were read on the floors of both chambers yesterday.
According to him, “The total cost of the projects and programmes under the
borrowing (rolling) plan is $29.960 billion, made up of proposed projects
and programmes loan of $11.274 billion, Special National Infrastructure
projects $10.686 billion, Euro bonds of $4.5 billion and Federal
Government budget support of $3.5billion.”
The President, who also explained that the loan was very necessary, in
view of the serious infrastructure deficit in the country, said:
“Considering the huge infrastructure deficit currently being experienced
in the country and the enormous financial resources required to fill the
gap, in the face of dwindling resources and the inability of our annual
budgetary provisions to bridge the deficit, it has become necessary to
resort to prudent external borrowing to bridge the financing gap, which
will largely be applied to key infrastructure projects, namely power,
railway and road projects, among others.”
He said the N180 billion virement would be moved from monies already
appropriated for special intervention programmes, both recurrent and
capital, for funding of critical recurrent and capital items.
The President added that the request came up because of shortfalls in
provisions for personnel costs; inadequate provision, ab initio, for some
items like the amnesty programme; continuing requirements to sustain the
war against insurgency; and depreciation of the Naira.
The projects to be financed with the N180.839 billion include the Amnesty
programme, National Youth Serve Corps, NYSC, and the Public Service Wage
Adjustment, PSWA.
President Buhari explained that external borrowing plan would be targeted
at projects which cut across all sectors, with special emphasis on
infrastructure, agriculture, health, education , water supply, among
others. According to the letter which was read at the Senate by the Deputy
President of Senate, Ike Ekweremadu, who presided over the session, the
Amnesty Programme will get a total sum of N35 billion from the transfer.
It added that the total recurrent expenditure requirement to be
transferred was N166,630,886,954, while the capital expenditure
requirement to be transferred was N14,208,367,476″ A breakdown of the
specific areas the N180.9 billion would be transferred to showed that
Public Service Wage Adjustment takes the lion share of N71,800,215,270;
followed by the Amnesty Programme, which took N35billion while the
mobilisation of corps members received N19,792,018,400.
Others are: Foreign Missions which gulped N14,667,230,014; Operation
Lafiya Dole takes N13,933,093,000; Nigerian Air Force takes
N12,708,367,476; Internal Operations of the Armed Forces takes
N5,205,930,270; Margin for Increase in Cost takes N2billion, while
Presidential Initiative for the North East received N1.5billion. Also,
Contingency, salary shortfall for Public Complaints Commission got
N1.2billion each, even as Cadet Feeding of Police Academy, Kano,
Augmentation of Meal subsidy for Unity Colleges received N932,400,000 and
N900,000,000 respectively.
On the need to make more funds available to the amnesty programme, the
President said, “Only N20,000,000,000 (already fully released) was
provided in the 2016 budget for the Niger Delta Amnesty Programme.
“Consequently, the allowances to ex-militants have only been paid up to
May 2016. This is creating a lot of restiveness and compounding the
security challenge in the Niger Delta,” Buhari said.
On NYSC funding, the President said: “The Provision for NYSC in the 2016
budget is inadequate to cater for the number of corpers to be mobilized
this year. In fact, an additional N8.5billion is required to cover the
backlog of 129, 469 corps members who are currently due for call-up but
would otherwise be left out till next year due to funding constraints.”
President who, also explained why the sum of N71.8 billion had to be
transferred from the intervention programme, said: “Similarly, the
provision for meal subsidy for the Unity Colleges is inadequate for the
number of students in the schools. Also, there was no provision for
feeding of cadets at the Police Academy, Wudil, Kano. These situations are
hampering the operations of the affected agencres. “The provision for
Statutory Transfer to the Public Complaints Commission (PCC) was reduced
to N2,000,000,000 in 2016 from N4,000,000,000 in 2015.
Consequently, the agency is experiencing difficulty in paying salaries of
its personnel as and when due. “Due to the devaluation of the Naira, the
budgetary provisions for the foreign missions are no longer sufficient to
cover all their costs. The provision for Presidential Initiative for the
North East (N12,000,000,000) has a balance of less than N1.5bn, and there
continue to be emerging challenges with the Internally Displaced Persons
(lDPs) in the zone.” The letter reads in part:”In the course of
implementing the 2016 Appropriation Act, several MDAs have presented
issues pertaining to salary shortfalls, the settlement of part of which
has led to the depletion of the Public Service Wage Adjustment (PSWA).
This Vote, which had a provision of N33, 597,400,000, now has a balance of
N2, 758,296,000.
“The Committee on Salary Shortfalls, set up by the Honourable Minister of
Finance, has come up with a figure of N41,875,983,020 as the amount
required to settle salary shortfalls of non-lPPlS MDAs. Similarly, most of
the lPPlS MDAs have already been notified by the Office of the
Accountant-General of the Federation (OAGF) that they would soon be locked
out of the IPPIS Platform as their Personnel Cost budgets would not cover
salaries for the rest of the year.
“The lPPlS Department in the OAGF has forwarded a figure of N20,
058,204,856 as the sum required to cover the shortfall in salaries of
lPPlS MDAs. The Security-related lines in the Service Wide Vote,
specifically Operations internal for the Armed Forces (N13billion) and
Operation Lafiya Dole (N8billion) have all been totally released while the
Nigerian Air Force needs about (N12,708,367,476) to cover the foreign
exchange differentials in the procurement of its critical capabilities.
“The Contingency Vote of N12billion has a balance of only N1,827,570,443.
it is considered necessary to augment this vote in the light of frequently
emerging contingencies.
“Only N20,000,000,000 (already fully released) was provided in the 2016
budget for the Niger Delta Amnesty Progr mme. Consequently, the allowances
to ex-militants have only been paid up to May 2016. This is creating a lot
of restiveness and compounding the security challenge in the Niger Delta.
“The Provision for NYSC in the 2016 budget is inadequate to cater for the
number of corpers to be mobilized this year. In fact, an additional
N8.5billion is required to cover the backlog of 129, 469 corps members who
are currently due for call-up but would otherwise be left out till next
year due to funding constraints. Similarly, the provision for meal subsidy
for the Unity Colleges is inadequate for the number of students in the
schools. “Also, there was no provision for feeding of cadets at the Police
Academy, Wudil, Kano. These situations are hampering the operations of the
affected agencies. The provision for Statutory Transfer to the Public
Complaints Commission (PCC) was reduced to N2,000,000,000 in 2016 from
N4,000,000,000 in 2015.
Consequently, the agency is experiencing difficulty in paying salaries of
its personnel as and when due. “Due to the devaluation of the Naira, the
budgetary provisions for the foreign missions are no longer sufficient to
cover all their costs “The provision for Presidential Initiative for the
North East (N12, 000,000,000) has a balance of less than N1.5bn, and there
continue to be emerging challenges with the Internally Displaced Persons
(lDPs) in the zone”.
The breakdown of the virement proposal shows that N71.8 billion is for
public service wage adjustment, N35billion for Amnesty programme,
N19.8billion for mobilization of remaining