Adedayo Akinwale and Udora Orizu in Abuja
Members of the House of Representatives expressed concern over the federal government’s decision to borrow the sum of 5.01 trillion naira to finance the 6 trillion naira deficit in the 2022 appropriation bill.
Lawmakers expressed their concerns in plenary yesterday during the debate on the general principles of the 2022 finance bill presented to the joint session of the National Assembly last week.
Commenting on the bill, the Hon. Leke Abejide congratulated President Muhammadu Buhari for making investment projects a priority in both the 2021 budget and the proposed 2022 budget.
Citing a reliable source, the lawmaker said some of the 2021 budget projects have been 100% funded.
Abejide said, “That’s why I don’t care much about borrowing, once the investment projects are executed, it will lead to economic growth and subsequently economic development.”
The legislator also expressed concern over the assumptions of key parameters of the budget, including the issue of crude oil production per day, it has been set to 1.8 million per day.
Abejide said: “During our hearing on the Media Expenditure Framework (MTEF) and GMD NNPC appeared before the House Finance Committee, he said the average production range was between 1, 6 million and 1.7 million per day. So in projection, it’s always good to be realistic. The average of 1.7 million a day is more realistic than going higher, because when there is a shock, it will be difficult for us to remedy it.
In his brief, the Hon. Onofiok Luke praised the president for the plausible budget recommendations and also raised concerns about the new loans.
The lawmaker commended the federal government for providing around N50 billion for the medical staff risk allowance, pointing out that part of the issues that led to the medical staff going on strike was the indemnity. risk that has not been paid.
Luke stressed the need to invest in security given the challenges the country is currently facing.
Luke, however, denounced the sum of 3.9 trillion naira for debt service, which represents almost 25% of the entire budget, saying it was worrying.
He added: “Another source of concern is that the proposal before us presents a deficit of N6,200 billion and that the government is proposing new borrowing to finance this deficit. This implies that Nigeria’s total public debt is then expected to reach N5 trillion in FY2022. This is worrying not only for today but for unborn generations and the future of Nigeria. Let’s do what we can to try to reduce the deficit and how we can reduce borrowing.
“Now let’s move on to the next point on the issue, so borrowing. There is nothing wrong with borrowing as long as you borrow and put it for production and not for consumption. So as we begin to look at it, let’s consider Nigeria’s future generations as we borrow and make sure that the borrowings are invested in productive businesses.
“As we spend the borrowed money on infrastructure, three clear things come to mind. We looked at security. We need to invest in power. Let’s borrow to invest in electricity and roads. We have road challenges across the country.
Luke noted that the federal government should use the recovered loot and embezzled funds to reduce the county’s deficit and borrowing.
Luke said, “Let me add that in the last three years since 2018 we have had an annual high at an average of around $ 60 a barrel. We should therefore advocate raising the peg from $ 57 per barrel to $ 60 per barrel.
“In 2018, the high of the year was 77.41 cents per barrel. In 2019, it was 66.24 cents. In 2020, it was 63.23 cents. To date, Brent is $ 83.27. Bonny Bright costs $ 82.30. So we can have an average of $ 60 a barrel and that would be sustainable for us. “
In his contribution, the House Minority Leader, the Hon. Ndudi Elumelu, also expressed concern about the huge loan.
He explained, “With the emergence of COVID-19, this budget should be able to address these anomalies in front of us, ensuring that our medical centers are up to date with the required infrastructure. I see no reason why this National Assembly should frequent such agencies, if we find out that they really did nothing in the previous budget. I submit that this National Assembly should for no reason give money to this agency. “
For his part, the Deputy Minority Leader, the Hon. Toby Okechukwu lamented over 3 trillion naira for debt service and over 6 trillion naira for recurrent spending.
He said, “With over 3 trillion naira for debt servicing and over 6 trillion naira for recurrent spending, that means everything that goes to capital spending if you take out Tetfund and these agencies. , that’s about 2.8 trillion naira.
“There is no way that we can continue to commit this level of funds for recurrent spending and debt service and we will overcome it.”
Earlier, the House leader, the Hon. Ado Doguwa, who led the debate, said there was a need for the government to invest heavily in infrastructure.