By Tony Akowe and Victor Oluwasegun, Abuja
The Federal Government has sent a proposal to the National Assembly seeking to reduce the 2020 Appropriation Act of N10.593 trillion by N318 billion, thus bringing it to a new low of N10.277 trillion.
The request is coming on the heels of tumbling oil prices at the international spot market. Also being proposed by the government, is the peg of oil benchmark at $30 per barrel from its previous peak of $57 per barrel, as well as the need to raise the exchange rate to N360 to the dollar and the daily oil production lowered to 1.70 million barrel per day from 2.18 million barrel per day that was earlier proposed.
The proposals will be tabled before both chambers of the National Assembly when they reconvene.
In addition, the executive has requested approval for a 20 per cent total cut in Capital projects across board, while a new budget line that reads Federation Provision for COVID-19 Crisis Intervention has been opened with N150 billion allocated to it.
The total transfers to some arms of government and statutory agencies were reduced from N560.47 billion to N407.81 billion, while allocations to the Judiciary and the National Assembly remained unchanged.
The National Judicial Council (NJC) was allocated N110 billion, while the National Assembly was allocated N128 billion in the original 2020 budget.
Allocations to the Independent National Electoral Commission (N40 billion), Public Complaints Commission (N4.7 billion) and the Human Rights Commission (N2.5 billion)) remained unchanged.
Also unchanged are the votes for foreign and local debt servicing, as well as contributions to the Presidential Power Initiative and the Nigeria Sovereign Investment Authority (NSIA).
The budget cut, according to the memo sent to the National Assembly, will see the government’s expected revenue from the oil and gas sector dipping to N1.45 trillion from N7.67 trillion.
The expected revenue inflow from the Federation Account reduced from N14.12 trillion to N8 trillion.
The revenue from non-oil sources is also expected to reduce from N6.442 trillion to N5.846 trillion with Corporate Tax and Value Added Tax (VAT) to contribute N1.822 trillion and N.164 trillion down from the original N1.836 and 2.25 trillion.
Funds to be distributed to the three tiers of government from the Federation Account are expected to dip from N8.571 trillion to N3.128 trillion.
Allocations to the Niger Delta Development Commission (NDDC) and the North East Development Commission (NEDC) have been reduced from N80.881 billion and N38.101 billion to N29.521 and N14.078 billion, while the Universal basic Education Commission (UBEC) has its budget slashed to N61.024 billion from N111.789 billion.
The recurrent non-debit budget will come down from N4.842 trillion to N4.738 trillion while the aggregate capital vote was reduced from N2.783 trillion to N2.628 trillion.
