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Senate passes N982.729bn supplementary budget for 2021  

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Senate President Ahmad Lawan
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The Senate on Wednesday approved the sum of N982.729 billion as supplementary budget for the 2021 fiscal year.

The approved sum represents an upward review of N86.9 billion from the initial amount of N895.842 billion transmitted to the National Assembly by President Muhammadu Buhari about two weeks ago.

 The passage of the supplementary Appropriation Bill 2021, followed the consideration of a report by the Committee on Appropriation during plenary.

Accordingly, out of the total sum of N982,729,695,343 billion passed, N123,332,174,164 billion is for Recurrent (Non-Debt) Expenditure; and N859,397,521,179 billion as contribution to the Development Fund for Capital Expenditure.

Chairman of the Appropriation Committee, Senator Barau Jibrin, in his presentation explained that the sum of N45.63 billion required for COVID-19 vaccine Programme would be sourced through existing World Bank Loan as well as other Grants.

He added that the balance of N37.93 billion would be sourced from Special Reserve/Levy Accounts comprising: TSA (Foreign currency component) – N25 billion; MOFI CHQ optional – N5 billion; and Foreign Revenue E-Collection – N30 billion; 65 percent Wheat Floor Levy – N15 billion; 5.15 percent Wheat Grain Levy – N15 billion; and Rolled-Over Capital (unspent) – N5 billion.

The lawmaker disclosed that the balance of N722.40 billion which is for capital expenditure on procurement of additional equipment for the security and capital supplementation would be sourced from new borrowing.

Barau explained that the Committee in line with the harmonised position with its House of Representatives counterpart recommended an upward review of the funding of some Security Agencies that were grossly underfunded or not funded in the supplementary Appropriation Bill.

The lawmaker listed the Agencies to include the Nigerian Navy, Ministry of Police Affairs, Defence Intelligence Agency, Department of State Security Services (DSS) and Economic and Financial Crimes Commission (EFCC).

A breakdown of Capital Expenditure for Ministries, Departments and Agencies of Government in the supplementary budget shows that N8,500,000,000 was approved for the Ministry of Police Affairs; N22,586,121,511 for Police Formations and Command; N33,673,461,231 for the Defence Headquarter; N207,543,863,993 for the Nigerian Army; N157,780,421,836 – Nigerian Navy; N239,477,882,473 – Nigerian Air Force; N43,326,943,687 – Defence Space Administration; and N16,887,229,426 – Defence Intelligence Agency.

Others include: Nigeria Security and Civil Defence Corps – N14,822,575,648; Office of the National Security Adviser – N17,000,000,000; Department of State Services – N17,500,000,000; National Intelligence Agency – N4,870,350,000; Economic and Financial Crimes Commission (EFCC) – N3,500,000,000; and National Agency For the Control of AIDS (NACA) – N1,685,000,000.

Under the Federal Ministry of Health, the sum of N2,800,000,00 was approved for the procurement of Molecular Laboratory Equipments to Hospitals (N300m), National Orthopedic Hospital, Igbobi (N300m), National Eye Centre, Kaduna (N300m), National Fistula Centre, Abakaliki (N300m), National Fistula Hospital, Sokoto (N300m), Federal Neuro-Psychiatric Hospital, Calabar (N300m), University of Nigeria Teaching Hospital (N300m), Federal Medical Centre Asaba Annex Aniocha (N300m) and FMC Nguru (N400m).

In addition, the sum of N6,715,338,874 was approved for the Procurement and Installation of New Oxygen Plants Nationwide and Repairs of Oxygen Plants in FCT Hospitals; and N60,728,332,500 for Vaccines Procurement Cost (Federal Government of Nigeria Funding – $298,500,000 for 29.85 million Johnson & Johnson Vaccines.

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Business & Economy

FAAC: FG, States, LGs share N656.6bn as April allocation

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Arising from it’s virtual conference meeting, the Federation Account Allocation Committee (FAAC), shared a total sum of N656.602 billion to the Federal, States and Local Governments as allocation for April.

From this stated amount, inclusive of Gross Statutory Revenue, Value Added Tax (VAT), Excess Bank Charges Recovered and Augmentation of N20 billion, the Federal Government received N257.611 billion.

The States received N201.256 billion, the Local Government Councils got N149.251 billion, while the Oil producing states received N48.485 billion as derivation (13% of Mineral Revenue).

A communiqué issued the end of the FAAC meeting, indicated that the Gross Revenue available from the Value Added Tax (VAT) for April, was N166.522 billion.

The distribution indicates that the Federal Government received N24.978 billion, the States received N83.261 billion, while the Local Government Councils got N58.283 billion.

From the distributed Statutory Revenue of N337.432 billion, the Federal Government was allocated the sum of N165.248 billion, States received N83.816 billion, while Local Government got N64.618 billion and N23.750 was allocated as Derivation (13% Mineral Revenue).

The communiqué revealed that Petroleum Profit Tax (PPT), Oil and Excise Duty increased marginally.

However, Oil and Gas Royalties, Import Duty, Companies Income Tax (CIT) and Value Added Tax (VAT) recorded significant decreases.

The communiqué further disclosed that total revenue distributable for the current month was drawn from Statutory Revenue of N461.189 billion, Value Added Tax (VAT) of N166.522 billion, Excess Bank Charges Recovered of N8.891 billion and an Augmentation of N20 billion bringing the total distributable for the month to N656.606 billion.

The balance in the Excess Crude Account as at 25th May, 2022 stands at $35.377 million.

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Two years after, CBN jack up interest rate to 13%

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Godwin Emefiele - CBN Governor
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The Central Bank of Nigeria’s Monetary Policy Committee has jacked up benchmark interest to 13 per cent, 150 basis points above the previous rate.

It is the first change since September 2020.

Addressing journalists on Tuesday after the committee’s142nd and third meeting for the year at the CBN headquarters in Abuja, CBN, Emefiele said the action was to tame the rising inflation rate in the country.

He said the committee voted to maintain the CRR at 27 percent and the Liquidity Ratio at 30 percent while the asymmetric corridor of +200 and -700 basis points around the MPR was also adopted.

He was concern that the impact of the CBN development finance initiatives was being threatened by an astronomic rise in inflation rate and explained that the MPC was faced with the dilemma of managing two parallel trends at the same time.

The CBN governor, however, said the rate on development finance loans will remain at 5 percent till 2023.

“Six members voted to raise the MPR by 150 basis points, four members by 100 basis points and one member, by 50 basis points.

“Members expressed deep concern about the continued uptrend of inflationary pressure in spite of the gradual improvement in output growth.

“Committee notes that the current rise in inflation is inimical to growth and the full recovery of the Nigerian economy,” he said.

The committee urged the federal government to do more to provide a safe and secure environment for economic activities to stimulate growth.

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Business & Economy

Nigeria economy records 3.11% growth in Q1’22 – NBS

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Nigeria’s economy grew by 3.11 per cent year on year in the first quarter of 2022 from 0.51 per cent recorded in the corresponding period in 2021, according to the National Bureau of Statistics (NBS).

The report stated that the Q1’22 growth rate represents an improvement in economic performance, adding that the observed trend since Q4 2020 is an indication of a gradual economic stability.

The NBS stated this in the Nigerian Gross Domestic Product Report (Q1 2022) released on Monday morning.

The : “Gross Domestic Product (GDP) grew by 3.11% (year-on-year) in real terms in the first quarter of 2022, showing a sustained positive growth for six consecutive quarters since the recession witnessed in 2020 when negative growth rates were recorded in quarter two and three of 2020.

“The first quarter 2022 growth rate further represents an improvement in economic performance. The observed trend since Q4 2020 is an indication of a gradual economic stability.

“The Q1 2022 growth rate was higher than the 0.51% growth rate recorded in Q1 2021 by 2.60% points and lower than 3.98% recorded in Q4 2021 by 0.88% points. Nevertheless, quarter-on-quarter, real GDP grew at -14.66% in Q1 2022 compared to Q4 2021, reflecting a lower economic activity than the preceding quarter.

The NBS further said in the quarter under review, aggregate GDP stood at N45,317,823.33 million in nominal terms.

“This performance is higher when compared to the first quarter of 2021 which recorded aggregate GDP of N40,014,482.74 million, indicating a year-on-year nominal growth rate of 13.25%. The nominal GDP growth rate in Q1 2022 was higher relative to the 12.25% growth recorded in the first quarter of 2021 and higher compared to the 13.11% growth recorded in the preceding quarter.”

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