As a result of drastic fall of price of oil
in the international market which has
dropped from about $100 per barrel to
$77, the Federal Government has
proposed a drastic review of key
parameters upon which the 2015 Budget
estimates were to be based.
The government had, in an earlier letter
forwarded to the National Assembly in
September, containing the 2015 2017 –
(MTEF & FSP), proposed a total
expenditure profile of N4.817trillion as
the 2015 estimates with$78 as oil
benchmark, oil production of
2.2782million barrel per day and N160 to
a dollar as average exchange rate.
But in a revised MTEF and FSP
forwarded to the Se=nate yesterday, the
President Goodluck Jonathan is
proposing a total expenditure profile of
N4.661 trillion for the 2015 budget
estimates as against N4.817 earlier
proposed, indicating a reduction of about
N235billion.
Also, in the latest proposal, $73 per
barrel is fixed as oil price benchmark as
against $78 earlier proposed.
A slight change is also effected in the
exchange rate as one of the key
parameters upon which the budget
would be based. While in the MTEF &
FSP document earlier forwarded, N160 to
a US dollar was proposed as exchange
rate, N162 to a US dollar is proposed in
the latest document.
The N235 billion shortfall in the latest
proposed total expenditure profile arose
from cuts effected from critical areas like
SURE-P which had N259billion earlier
earmarked for its capital expenditure but
reduced to N184billion in the latest
proposal.
Others are the MDAs capital
expenditure , earlier estimated for
N1.029trillion but now reduced to
N872billion
Ditto for subsidies for petroleum and
kerosene reduced in billions from earlier
proposals made.
The President’s letter for the new
proposals entitled: “Submission of
Revised 2015-2017 Medium -Term
Expenditure Framework,” reads in part:
“As you may recall, I had transmitted the
2015-2017 Medium Term Expenditure
Framework and Fiscal Strategy Paper
(MTEF&FSP) to the National Assembly
for consideration and approval.
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