President Buhari signs 2023 Appropriation Bill into law to avoid delay in the commencement of its implementation. President yet to sign Finance Bill 2022 and urges the National Assembly to reconsider its decision on his N23.7 trillion ‘Ways and Means’ request
Six days after its passage by both chambers of the National Assembly, President Muhammadu Buhari has signed the N21.83 trillion 2023 Budget of the Federal Government into law.
The President signed the Appropriation Bill for the 2023 fiscal year at a brief ceremony televised on Tuesday from the Council Chambers of the State House Abuja, with members of the Federal Executive Council, including the Secretary to the Government of the Federation, Boss Mustapha, Chief of Staff, Ibrahim Gambari, Attorney-General and Minister of Justice, Abubakar Malami, Minister of Finance, Budget and National Planning, Zainab Ahmed, present.
President of the Senate, Ahmad Lawan; Speaker House of Representatives, Femi Gbajabiamila; Chairmen of the Senate and House Committees on Appropriation and Finance were members of the National Assembly who were present at the ceremony.
Noting that he assented to the budget to enable the commencement of its implementation without delay, he directed the Minister of Finance, Budget and National Planning, Zainab Ahmed, to liaise with the National Assembly towards effecting necessary amendments to the bill. “As is customary, the Honourable Minister of Finance, Budget and National Planning will subsequently provide more details of the approved budget and the supporting 2022 Finance Act.
Nevertheless, considering the imminent transition process to another democratically elected government, I decided to sign the 2023 Appropriation Bill into law as passed by the National Assembly to enable its implementation to commence without delay.
I have, however, directed the Minister of Finance, Budget and National Planning to engage with the Legislature to revisit some of the changes made to the Executive budget proposal, and it is my hope that we will receive cooperation in this regard from the National Assembly,” he stated.
The President, who also noted that the National Assembly introduced new projects into the 2023 budget proposal for which it has appropriated N770.72 billion, added that the National Assembly also increased the provisions made by Ministries, Departments and Agencies (MDAs) by N58.55 billion.
“It is clear that the National Assembly and the executive need to capture some of the proposed additional revenue sources in the fiscal framework. This must be rectified.”
Buhari also urged the National Assembly to reconsider its decision on his N23.7 trillion ‘Ways and Means’ request, stressing that a failure to grant the securitisation approval will cost the government about N1.8 trillion in additional interest in 2023, given the differential between the applicable interest rates, negotiated interest rate and a 40-year repayment period on the securitised debt.
“I also urge the National Assembly to reconsider its position on my proposal to securitise the Federal Government’s outstanding Ways and Means balance at the Central Bank of Nigeria (CBN).
As I stated, the balance has accumulated over several years and represents funding provided by the CBN as a lender of last resort to the government to enable it to meet obligations to lenders, as well as cover budgetary shortfalls in projected revenues and/or borrowings.
I have no intention to fetter the right of the National Assembly to interrogate the composition of this balance, which can still be done even after granting the requested approval.
Failure to grant the securitisation approval will, however, cost the government about N1.8 trillion in additional interest in 2023, given the differential between the applicable interest rates, which is currently MPR plus 3% and the negotiated interest rate of 9% and a 40year repayment period on the securitised debt of the Ways and Means,” he said.
The President, who is yet to sign the Finance Act 2022 into law, used the opportunity to task Ministries, Departments, Agencies (MDAs) and other institutions of government to gear up the revenue generation process.
The 2023 budget was increased by N1.32 trillion from the N20.51 trillion proposed by the executive in October 2022, with the breakdown indicating an allocation of N967.5 billion for statutory transfers, N6.6 trillion for debt servicing, N8.3 trillion for recurrent expenditure, and N5.9 trillion for capital expenditure.
Some key capital allocations include N285 billion to the Federal Ministry of Defence, N134.9 billion to the Federal Ministry of Health, N195.5 billion to the Federal Ministry of Power and N153.7 billion to the Federal Ministry of Education.
According to the 2023 Appropriation Bill, the total revenue available to fund the budget for the year was estimated at N9.73 trillion, leaving a deficit of N10.78 trillion, representing 4.78% of the nation’s GDP and higher than the 3% threshold set by the Fiscal Responsibility Act 2007.