March 15, 2012 – The Senate and House of Representatives on Thursday passed the 2012 budget totalling N4.877tn.
Nigeria Budget 2012
The amount is N228.36bn higher than the reviewed budget estimates sent to the National Assembly by President Goodluck Jonathan following adjustments made to include N888bn for subsidy on petrol for the 2012 fiscal year.
The Minister of Finance, Dr. Ngozi Okonjo-Iweala, had earlier proposed a revised estimate of N4.649tn as government expenditure for the year.
Presenting the report of the budget consideration, the Chairman, Senate Committee on Appropriation, Senator Mohammed Maccido, said the Federal Government made an additional provision of N180bn to cater for the Subsidy Reinvestment and Empowerment Programme.
He said that the committee increased the oil benchmark price to $72 per barrel as against the $70 earlier proposed.
According to him, the adjustment of the benchmark price ensured the availability of N98bn to partly finance the N1.1tn deficit.
Other revenue projections in the budget include a 7.2 per cent Gross Domestic Product growth rate, inflation rate of 9.5 per cent and production of 2.48 million barrels of crude oil per day.
A breakdown of the budget showed that N2.425tn would be spent on recurrent (non-debt) expenditure, while N1.519tn would be for capital expenditure.
N372.59bn was approved for statutory transfers and N559.580bn for debt servicing.
Maccido said, “The laying of the budget by the Executive should be done well before the end of the fiscal year to enable passage within the ongoing fiscal year. It will be proper if a gap of three months is given between the time of laying and the end of the previous fiscal year in line with the Fiscal Responsibility Act.
“The conceptualisation of the budget by the Executive should be thorough before it is laid at the joint session of the National Assembly. This will quicken the passage and will not bring confusion among the legislators, as this revised version almost did.”
The President of the Senate, David Mark, in his remarks, said it was a good development that the budget deficit, which was earlier put at N1.1tn, had been reduced drastically.
“It is a welcome development that we will have a balanced budget with minimal deficit,” he said.
While assessing the performance of the 2011 budget, Maccido described it as dismal.’
He was, however, optimistic that the 2012 budget would perform better, saying it was a good budget since most of the projects tied to it were ongoing.
There was, however, an indication that the legislature might have decided to take legal action against the Central Bank of Nigeria for its refusal to submit its budget to the National Assembly for scrutiny.
Briefing journalists after the session, the spokesman of the Senate, Senator Enyinnaya Abaribe, said the conflict between the CBN Act and the Fiscal Responsibility Act would be legally tested.
While the Fiscal Responsibility Act requires all federal executive bodies, which include the CBN, to submit their budgets to the National Assembly, the apex bank claims that the power of approval of its budget is vested in its board.
Abaribe said, “Under the CBN Act, there is a provision there that the board of the CBN takes care of its budget. But under the Fiscal Responsibility Act, all agencies of government and every other agency is supposed to bring their budgets to the National Assembly for scrutiny.
“Unfortunately for us, the governor of the CBN is hiding under the CBN Act to refuse to submit the budget of the bank to the National Assembly, and that is a legal matter we will take up with the Executive.”