The Senate today passed the 2020-2022 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) submitted to it by President Muhammadu Buhari last week, raising the 2020 budgetary proposal by N727 billion and the oil benchmark by $2 per barrel.
The approval was sequel to the presentation and consideration of the Senate Committee on Finance report.
Specifically, the upper legislative chamber of the National Assembly increased the 2020 proposed budget from N10.002 trillion to N10.729.4 trillion, even as it tinkered with the oil benchmark price, jacking it up to $57 per barrel from the $55 benchmark price proposed by the Executive.
Similarly, the Senate increased the 2020 revenue target set for the Nigeria Customs Service (NCS) from N942.6 billion to N1.5trillion, representing about N557.4 billion increase. However, the legislature retained the N305/dollar exchange rate as well the oil production benchmark at 2.18mbpd as proposed in the MTEF/FSP by the Executive.
The Senator Olamilekan Adeola-led Committee also recommended a total of N1.5 trillion as federal borrowing limit for the fiscal year 2020, following the reduction of N200 billion tied to the increase of revenue target of the Nigeria Custom Service.
This is even as it canvassed the need for urgent review and amendment to the Fiscal Responsibility Act (FRA Act) and other legislation guiding the operations of the revenue generating agencies to align with current realities.
Most of the recommendations derived from the recommendations of the National Assembly Joint Committee on Finance report on 2020-2022 MTEF/FSP which was deliberated upon by the upper legislative chamber last Thursday.
The Committee reported: “Following intensive engagement with NNPC and relevant information obtained during the session, the Committee recommends the adoption of 2.18mbpd as daily production output in 2020. In view of concerted effort by NNPC and security agencies the menaces of oil theft and vandalization, the 2.18mbpd would be realizable.
“The Committee recommends the adoption of $57/barrel as crude oil benchmark price for the fiscal year 2020.
“The revenue target of Nigeria Customs Service (NCS) of N942.6 billion for 2020 should be increased to N1.5 trillion, as a result of the performance of NSC in last 9 months with 3 months still outstanding.
“The NCS revenue as at September stood at N1 trillion against the budget figure of N969. 8 billion for the year 2019. The Joint Committee commends the NCS for exceeding the targeted revenue despite the global economic challenges and closure of the Nigerian boarders.
“The sum of N557.4 billion from the revenue increment of NCS be used to reduce borrowing by N200 billion and increase capital expenditure thereby decreasing the size of the budget deficit from N1.7 trillion to N1.5 trillion and also increase the total capital available to MDA by N357 billion, from N1.01 trillion to N1.367 trillion”, it added.