Although current economic realities have threatened the smooth implementation of the 2016 Budget, government will only consider a review when there are clear indications of persistent fall in revenue expectations.
Budget and National Planning Minister, Senator Udoma Udo Udoma who gave this indication while responding to questions at a Town Hall Meeting in Abuja on Tuesday, said although the disparity between projected revenue and actual receipts in the last two quarters was obvious, government was optimistic that the current situation will not prevail for long.
The meeting which was inspired by the Nigerian Institute of Policy and Strategic Studies (NIPSS) focused on “Effective implementation of the 2016 Budget”.
Senator Udoma said government was keeping close watch on the trend, particularly on the economic indicators.
He admitted that government is worried about the current trend which does not align with expectations as contained in the budget fundamentals.
The Minister said however that if the downward trajectory persists, government might make reasonable adjustments to accord with prevailing realities.
He explained that at the inception of the current Administration, the economy was facing several challenges including declining oil prices and production which led to declining external reserves and GDP growth rate. There was also rising inflation, increasing unemployment rate, insecurity, high cost of governance, corruption, infrastructure deficit and the worsening of key socio-economic indicators.
The 2016 budget, he explained, was therefore designed to deal with these problems and in doing so government had to take a deliberate decision to deviate from the past by assigning a reasonable portion of the budget to infrastructure development.
This was not only to provide backbone infrastructure to the agriculture and solid mineral development, which are to redirect the country from sole dependence on oil for revenue, but to energize other sectors that are not fundamentally affected by government overheads that take the bulk of national budgets.
Senator Udoma said in spite of the dwindling resources, government is determined to use the budget as an instrument to reflate the economy, which is why the budget was backed up with a Strategic Implementation Plan (SIP) to fundamentally address the challenges.
The SIP, he added, was to direct the trajectory of the national economy towards the path of sustainable development and inclusive growth; explaining that the Plan consists of 34 priority actions to be implemented along six major strategic areas namely Policy, Security & Governance; Diversity the Economy; Power, Rail & Roads; Oil and Gas Reforms; Ease of Doing Business; and Social Investment. Government has also set measurable targets for implementation.
In its determined efforts to provide the necessary infrastructure to help boost economic activities, government has so far released more than N330 billion for capital projects, inclusive of the capital in statutory transfers, it was disclosed.
The Minister also said government is partnering the private sector to fix infrastructure.
Information Minister and moderator of the Town Hall Meeting, Alhaji Lai Mohammed, said government was ever ready to engage with Nigerians and to explain its policies and actions as well as seek inputs from the people for the better governance of the country.
He was delighted that instead of joining the band of fault-finders and traditional critics of government, the alumni of NIPSS decided to constructively engage with government towards finding solutions and contributing to the growth of the economy.
Finance Minister, Kemi Adeosun, traced the journey to the current state of economy to more than seven years ago when successive governments gave more premium to recurrent expenditure to the detriment of capital spend. This coupled with other untoward economic policies paved the way for the current poor outing, she added.
She said however, that government has decided to reverse the trend with increased capital expenditure and diversification of the economy from the current mono-product status.
Adeosun said diversification is an agenda which government must achieve, because it is a veritable means to unlock the economy and create more jobs for the people.
Other Ministers at the meeting include Power, Works and Housing, Mr Babatunde Raji Fashola; Solid Minerals Development, Dr Kayode Fayemi; Agriculture, Chief Audu Ogbeh; Health, Dr Isaac Adewole; Foreign Affairs, Godfrey Onyeama; and Environment, Amina Mohammed. The Vice President was represented by the Special Adviser to the President on Economic Matters, Dr Adeyemi Dipeolu.
The Sultan of Sokoto, His Eminence Sa’ad Abubakar, was chairman at the event and was accompanied by the Etsu Nupe, His Highness Alhaji Yahaya Abubakar.
Media Adviser to Honorable Minister