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National Assembly increases oil benchmark to $76.5pb

By on November 9, 2013

A report by the Joint Committees of the National Assembly on Finance and Appropriation which was submitted on the floor of the Senate Thursday has recommended an upward review of the oil benchmark price from $74 per barrel to $76.5 per barrel in the 2014 budget as contained in the Medium Term Economic Framework and Fiscal Strategy Paper (MTEF and FSP) 2014-2016, and also described the implementation of the 2013 budget as poor.

The report also frowned at the continuous building up of the nation’s foreign reserves above the internationally recognised standards of three months at the expense of the provision of critical infrastructure whose multiplier effect on GDP would boost national development.

The Ahmed Makarfi committee further called on government to take drastic measure at curtailing the ongoing crude oil theft in the Niger Delta.

“Oil theft came into prominence in 2012 with a daily loss of about 150,000bpd. By July 2013, the loss had risen to about 400,000bpd. Government needs to take some drastic steps to halt this development.”

However, the committee lamented that it was disheartening to learn that a total of N93.5 billion of the N180 billion Subsidy Reinvestment Empowerment Programme (SURE-P) allocation for 2012 which could not be exhausted in the 2012 budget was rolled over to 2013.

“This shows that only 40 per cent of the SURE-P budget was utilised. That brings the total SURE-P budget for 2013 to N273.5 billion instead of the usual annual N180 billion for SURE-P.
“It was observed that of the N273.5 billion budgeted under SURE-P for 2013, only N104.1 billion had been expended on various projects and programmes, and that a provision has again been made to roll over to 2014 a total sum of N94.34 billion – an indication that about 34.50 per cent of the 2013 SURE-P allocation would not be spent.”

However, the joint committee maintained that details of all projects to be executed under the SURE-P budget must accompany the  2014 appropriations bill that will be presented next week Tuesday  to the joint session of the National Assembly by president Goodluck Jonathan.
In the same vein, the lawmakers said based on the submissions made to them by various government agencies, the 2013 budget implementation was very poor and that they “have given various reasons for the failure of the budget implementation.

From all indications, President Goodluck Jonathan will on November 12 present the 2014 budget to a joint sitting of both chambers of the National Assembly without the passage of the 2014 to 2016 MTEF and FSP.

The  report of the Joint Committee on Finance and Appropriation was listed on the Senate’s order paper for consideration yesterday, but Senator Ahmed Makarfi (PDP, Kaduna North), said the consideration of the report cannot proceed because that of the House of Representatives was yet to be concluded for proper harmonisation. The senate consequently deferred it indefinitely.

This means that Since the two chambers don’t sit on Fridays and Mondays, the implication is that the president will present the budget on Tuesday without the passage of MTEF or FSP and the MTEF and FSP set the parameters for the medium-term expenditure plan of government before the 2014 budget presentation.

The Chairman, Senate Committee on Rules and Business, Ita  Enang (PDP/Akwa Ibom East), said unless the National Assembly deliberate, pass and forward the MTEF to the president, he (President Jonathan) cannot present the budget.

He added that that the delay in the presentation of the 2014 budget was as a result of that as the president was waiting on.

 

 

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