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PROPOSED RECURRENT EXPENDITURE = N5.75TRN
PROPOSED CAPITAL EXPENDITURE = N3.33TRN
DEBT SERVICING = N3.12TRN
STATUTORY TRANSFERS = N481.41BN
The Federal Government has proposed the sum of N12.66 trillion as aggregate expenditure for 2021.
The proposed expansionary budget is expected to result in a deficit of N5.16 trillion which is to be financed by loan packages of N4.28 trillion.
The proposals are contained in the 2021- 2023 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper ( FSP), submitted to the Senate by President Muhammadu Buhari for approval.
Other details as contained in the MTEF include: proposed recurrent expenditure of N5.75 trillion, capital expenditure (N3.33 trillion), debt servicing (N3.12 trillion), and statutory transfers (N481.41billion).
The proposed 2021 budget is based on an oil benchmark of $40 per barrel with oil production of 1.86 million barrels.
The exchange rate is for the proposed budget is N360 to a dollar.
Also included in the proposals are: N500 billion intervention fund against COVID-19 pandemic, N52 billion for Public Works Programme, N32.46 billion for Social Intervention Programme, N5 billion as bail out for the aviation sector, and N60 billion for maintenance of roads through direct labour across the six geo- political zones.
In the MTEF, the Federal Government is targeting N205.15 billion from privatization proceeds to fund the budget.
The MTEF is an annual, rolling three year-expenditure planning which sets out the medium-term expenditure priorities and budget constraints against which sector plans can be developed and refined.
It aims to ensure that budgets reflect Government’s social and economic priorities and give substance to Government’s reconstruction and development commitments.
President Muhammadu Buhari, in a letter sent to the Senate President along with the MTEF/FSP documents, said “It is with pleasure that I forward the 2021 – 2023 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) for the kind consideration and approval of the Distinguished Senate.
“Let me seize this opportunity to express my deep gratitude for the cooperation, support and commitment of the leadership and distinguished members of the Senate in our collective efforts to sustain the restoration of the January – December financial year.
“In line with our commitment, we have worked very hard to achieve and earlier submission of the MTEF/FSP. This is to allow the National Assembly enough time to perform its important constitutional duty of reviewing the framework.
“I herewith forward the 2021 – 2023 MTEF/FSP as the 2021 budget of the Federal Government will be prepared based on the parameters and fiscal assumptions of the approved 2021 – 2023 MTEF/FSP. I seek the cooperation of the National Assembly for expeditious legislative action on the submission.”
BADEJO ADEMUYIWA has 23 years experience as a Finance Writer, specialising in Insurance and Investigative Reporting.
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