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Oil prices: FG raises FIRS, Customs revenue targets

By on October 23, 2014

The Federal Government has come up with a contingency plan that involves raising the targets of the key non-oil revenue agencies for next fiscal year in order to insulate the economy against the fall in the prices oil in the international market.

The Minister of Finance, Dr. Ngozi Okonjo- Iweala, disclosed this in Abuja on Tuesday during a press briefing.

The minster said the plan involved an increase in the revenue benchmark targets for both the Federal Inland Revenue Service and the Nigeria Customs Service.

Okonjo-Iweala also announced that the government had invited the Independent Corrupt Practices and other related Offences Tribunal to investigate and prosecute 60,000 ghost workers and pensioners that had been weeded out from the government payroll.

The minster, who did not disclose the new revenue targets given to the agencies for next year, said the FIRS had realised N44bn out of N75bn initial target, while the Customs realised N713bn between January and September out of its initial N1.23tn target.

She said, “We must shift the economy to non-oil revenue and we are already working hard on non-oil. Our revenue to GDP ratio is below that of other countries. We need to work very hard on non-oil and deliver on the non-oil sector.

“The global economy is volatile, oil prices are falling and as a matter of priority, we are developing a contingency plan to bring stability to the economy.”

Okonjo-Iweala said the present administration was doing a lot to enthrone transparency in the public service, adding that the commitment led to expulsion of the ghost workers from the payroll across the Ministries, Departments and Agencies, which led to the saving of N160bn.

“Last year, 60,000 ghost workers were weeded out, which saved government about N160bn. The ministry wrote to the ICPC to trace those that needed to be held accountable and we are ready to assist the ICPC on any issue that borders on transparency,” she said.

She said because the ministry lacked the power and resources for investigation, the ICPC had been invited to investigate and prosecute public officials that might have been involved in the criminal act.

“We have handed over the matter to the ICPC to investigate those that are culpable and prosecute them. We are ready to give them the information that we have,” she added.

Given some economic indicators, the minister said the country’s External Reserves had risen from $36.6bn in June to $39.48bn as of October 16.

She put Excess Crude Account balance at $4.11bn and the Sovereign Wealth Fund at $1.55bn.

Okonjo-Iweala also said the economy had enjoyed good measure of stability as key indices such as inflation, exchange rate and other instruments had been stable, a situation that had allowed investors to plan.

“The President has delivered on steady macro economy for this country, but the oil price has come down but it is not beyond our capacity to deal with and we are dealing with it by diversifying the economy,” she added.

The Chief Executive Officer of the Nigerian Sovereign Investment Authority, Mr. Uche Orji, said the Sovereign Wealth Fund investment programme over the next six months would go ahead, even as its capital base was being hit by falling oil prices.

He said one of the SWF’s core aims was to manage oil export windfalls to cushion the economy in harder times.

“The oil price; yes, it has come down. But frankly, let’s not forget why this fund was set up. It was to prepare us for days like this,” he told Reuters on the sidelines of an African investment conference in London on Tuesday.

Orji conceded that weakness in the international oil market would affect the fund but he remained focused on deploying existing assets to investment in infrastructure projects in sectors such as transport, power and health care.

“Obviously, we get funded from the oil price; so, if it’s lower, it will affect us. But our plan in the next six months is to fully deploy what we’ve been given. We still haven’t fully deployed our capital yet,” he said.

 

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