OrderPaperToday – The House of Representatives has frowned at the federal government for spending N1.8 trillion on debt servicing in the first five months of 2021.
The House accordingly urged the government to focus more on non-oil sectors of the economy in order to raise sufficient revenues to finance the budget and channel inflow from oil earnings to the Sovereign Wealth Fund (SWF).
These and other resolutions were reached at plenary on Tuesday during consideration on a motion sponsored by Chinedu Obidigwe (Anambara, PDP).
The lawmaker, in his motion, expressed displeasure over the situation where government spends 98% of total revenues generated on debt servicing in the period referred to in 2021.
Incidentally, some members of the House had defended the debt service component of the 2021 budget which same legislature approved without raising any challenge.
However, Mr. Obidigwe, in his motion, urged the House to task the government to save funds for future generations by focusing more on economic diversification. Accordingly, he urged that the federal government be made to secure approval from the National Assembly before tampering with the country’s SWF.
Mr. Obidigwe pointed out that Nigeria’s SWF is aimed at saving money for future generations; providing stabilisation of funds to defend the economy against commodity (oil) price shocks, and financing badly needed infrastructures.
He however observed that, Nigeria, with an estimated population of over 200 million, ranks 58 in SWF ranking which is four places lower than Angola – an oil-producing African country with a population of 32.87 million as of 2021 and has $3.2 billion in assets.
According to him, this is a “significant contrast to what other oil producers such as Kuwait, which has $700 billion “Life After-Oil-Fund”, different from its $41.7 billion foreign reserves and Angola with $3.2 billion in assets both as of March 202.
“A country such as Kuwait with a population of 4.2 million people and projected growth of 5.3 million by 2050, has a future fund of $700 billion to cater for their future population whereas Nigeria with an approximate population of over 200 million and an estimated population growth of 401 million people by 2050 has a Future Generations Fund (FGF) of only $2.5 billion.”
The motion was passed when the presiding officer, Femi Gbajabiamila put the question and was referred to relevant committees to ensure compliance.