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FG Exceeds Loan Target By N1.12trn, Borrows N5.3trn
The Federal Government exceeded its borrowing by N1.15trillion for the period between January and August, 2022.
A copy of the public presentation of the 2023 proposed budget by the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, showed that the Federal Government planned to borrow N6.10trillion in 2022.
A breakdown shows that the Federal Government planned to get N3.53trillion from domestic creditors and N2.57trillion from foreign creditors.
According to the document, the Federal Government estimated that it would borrow N4.07trillion between January and August, 2022.
However, the Federal Government accumulated N5.33trillion debt within the period under review, which is N1.15trillion higher than the expected N4.07trillion planned debt.
A further breakdown showed that the Federal Government borrowed N4.82trillion from domestic creditors and N510.21billion from foreign creditors.
The debt from domestic creditors includes the Federal Government’s borrowing from the Central Bank of Nigeria through the Ways and Means Advances.
Ways and Means’ Advances are loan facilities through which the CBN finances the shortfalls in the government’s budget.
The Federal Government recently borrowed a total of N4.61trillion from the Central Bank of Nigeria through Ways and Means Advances between January and August, 2022.
This means that majority of the Federal Government’s domestic debt came from its debt to the CBN.
The CBN said on its website that the Federal Government’s borrowing from it through the Ways and Means Advances could have adverse effects on the bank’s monetary policy to the detriment of domestic prices and exchange rates.
“The direct consequence of central banks’ financing of deficits are distortions or surges in monetary base leading to adverse effects on domestic prices and exchange rates i.e. macroeconomic instability because of excess liquidity that has been injected into the economy,” it said.
The World Bank had, last November, warned the Nigerian government against financing deficits by borrowing from the CBN through the Ways and Means Advances, saying this put fiscal pressures on the country’s expenditures.
Despite warnings from experts and organisations, the Federal Government has kept borrowing from the CBN to fund budget deficits.
Also, the N22.07trillion owed the apex bank by the Federal Government is not part of the country’s total public debt stock, which stood at N42.84trillion as of June 2022, according to the Debt Management Office.
The country’s debt rose by N30.72trillion between July, 2015 and June, 2022, according to data released by the DMO.
According to the DMO statistics, Nigeria’s total debt as of June 30, 2015, stood at N12.12trillion.
By June 30, 2022, the figure had risen to N42.84trillion, which showed an increase of 253.47per cent.
Despite the high increase in debt over the years, the government still plans to borrow N8.4trillion in 2023.
Experts have kicked against the Federal Government’s proclivity for debt, which they have described as unsustainable.
An Abuja-based policy think tank, Agora Policy, said Nigeria’s debt was unsustainable and put the country in a perilous situation due to the high cost of debt servicing.
The group advised the government to deepen and diversify sources of revenue, re-calibrate expenditure to spend smartly, and invest efficiently.
A former President of the National Accountants of Nigeria, Dr Sam Nzekwe, agreed that Nigeria’s debt was unsustainable.
He said, “The debt is huge. If you look at the budget, you will see that a huge sum of money is used to service debts. This is just the debt service charge. We are yet to talk about the principal.”
He also said that instead of focusing on the debt to GDP ratio, the focus should be on debt service to revenue ratio.
He further noted that the country had a revenue problem.
A development economist, Dr AliyuIlias, criticised the government for its constant reliance on borrowing, which was not healthy for the economy.
He further urged the government to seek better ways of generating revenue rather than persistently borrowing.
However, the finance minister, when she appeared before the House of Representatives Committee on Finance, last week, explained that the over-borrowing was a deliberate plan to ensure that money was released early for capital projects.
She said, “We are borrowing faster than what we had prorated. It was a conscious decision to make sure we have funds early enough to release for the implementation of capital projects.”
Meanwhile, the amount budgeted for recurrent expenditures has increased from N2.61trillion spent in 2015 to N8.27trillion in the proposed 2023 budget, according to data from the Budget Office of the Federation.
This shows an increase of N5.66trillion or 216.86per cent in six years, fuelling concerns over the rising cost of government overheads amid declining revenue and weakening economy.
Analysis revealed that recurrent expenditure recorded significant increases each year during the period under the review.
The former President, Dr Goodluck Jonathan, approved a N4.49trillion budget for 2015, which included a N2.61trillion recurrent expenditure.
Capital expenditure was N557billion, while money budgeted for debt service was N953.62billion.
There was a fiscal deficit of N1.08trillion.
The recurrent expenditure rose slightly by 1.53per cent or N40billion to N2.65trillion in 2016, out of a total expenditure of N6.06trillion.
Capital expenditure was N1.59trillion, while money budgeted for debt service was N1.48trillion.
There was a fiscal deficit of N2.2trillion.
In 2017, it rose to N2.99trillion, representing an increase of N340billion or 12.83per cent.
Out of a total expenditure of N7.44trillion, capital expenditure was N2.18trillion, while money budgeted for debt service was N1.66trillion.
There was a fiscal deficit of N2.36trillion.
In 2018, recurrent expenditure rose by N520billion or 17.39per cent, raising the total recurrent expenditure to N3.51trillion.
Out of a total expenditure of N9.12trillion, capital expenditure was N2.87trillion, while money budgeted for debt service was N2.01trillion.
There was a fiscal deficit of N1.95trillion.
The following year, the recurrent expenditure increased by N540billion or 15.38per cent to N4.05trillion.
Out of a total expenditure of N8.91trillion, capital expenditure was N2.09trillion, while money budgeted for debt service was N2.25trillion.
There was a fiscal deficit of N1.95trillion.
The recurrent expenditure was N4.84trillion in 2020, out of a total expenditure of N10.59trillion.
This shows an increase of N790billion or 19.51per cent.
Capital expenditure was N2.47trillion, while money budgeted for debt service was N2.7trillion.
There was a fiscal deficit of N2.28trillion.
However, the increase in 2020 may be attributed to the inclusion of the new national minimum wage in the budget.
In the 2022 budget, the recurrent expenditure hit N6.91trillion, representing an increase of N1.27trillion or 22.52per cent.
Out of a total expenditure of N17.13trillion, capital expenditure was N5.47trillion, while money budgeted for debt service was N3.88trillion.
There was a fiscal deficit of N6.26trillion.
President MuhammaduBuhari (rtd), recently presented the proposed 2023 budget to the National Assembly.
The proposed 2023 budget shows that the proposed recurrent expenditure is N8.27trillion, which is an increase of N19.68per cent or 1.36trillion from the previous year.
Out of a total expenditure of N20.01trillion, capital expenditure was N4.93trillion, while money budgeted for debt service was N6.65trillion.
There was a fiscal deficit of N10.7trillion.
The 2023 recurrent expenditure represents 41.33per cent of the nation’s entire budget and is the single largest element of the budget.
It is also N3.78billion more than the total expenditure for 2015.
From the 2023 recurrent (non-debt) expenditures, personnel costs gulped N4.08trillion; pensions, gratuities and retirees’ benefits took N721.46billion, while overheads cost N443.28billion.
Within the years of the Buhari’s regime, including 2015, a total of N38.82trillion has been budgeted for recurrent expenditures.
This total exceeds the N20.01trillion total budget proposed for the 2023 fiscal year.
Experts have lamented the constant increase in the nation’s cost of governance.
In May 2021, the Federal Government, through the Minister of Finance, Zainab Ahmed, had said it was working to reduce the high cost of governance by doing away with unnecessary expenditures, which might include salary cuts for workers.
However, the increase in recurrent expenditures in the 2023 budget suggests the government may have backpedalled on the plan.
Economic and financial experts have expressed concerns over what they described as significant increases in government expenditure, saying they were worrisome because a large chunk of government revenue had been allocated to recurrent expenditure instead of capital projects that drove economic growth.
The Registrar and Chief Executive Officer, National Institute of Credit Administration, Prof Chris Onalo, has stressed the need for the government to streamline its expenditure in order to manage its debt profile.
He said, “Everybody is concerned about the rising debt profile. And the reason it is going in that direction is because first, our recurrent expenditure is too big. When you borrow money, you don’t borrow to pay salaries. You don’t borrow to finance recurrent expenditure. That is where we have the biggest problem.
“The size of our civil service needs to be trimmed down. Some of the ministries have to be allowed to go. And then, we need a very serious audit of the Federal Government’s workforce. And until we do that, we will not be able to run the civil service system transparently. The government expenditure profile needs to be streamlined very seriously.”
An Associate Professor of Economics at Pan Atlantic University, Dr OlalekanAworinde, recently linked the development to rising salaries and the upcoming election.
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We’re Working To Improve Quality Of Life Of Rivers People -Fubara …As Taraba Gov Inaugurates 6.55km Okania-Ogbogoro-Mgbaraja Roads Project
Rivers State Governor, Sir Siminalayi Fubara, has reiterated the commitment of his administration to render quality service that will improve the quality of life of residents, and strengthen the platform to promote unity.
Governor Fubara gave the assurance at the Okania-Ogbogoro Road junction, venue of the inauguration of the 6.55km Okania-Ogbogoro-Mgbaraja (and Mgbuoba) Roads project in Obio/Akpor Local Government Area, yesterday.
The road cuts across Okania community through Ogbogoro, and connects Port Harcourt Ring Road project under construction, and was inaugurated by the Taraba State Governor, Dr Agbu Kefas.
Governor Fubara said that during the campaigns, he saw the roads in terrible condition, made a promise to fix them, and noted that that promise has been kept.
He emphasised that his administration will never be reckoned with abandoning of projects that it started, which is why he is particularly excited that the road has been fixed to ease the inconveniences suffered by the people.
The Governor said, “What we are doing here today is very simple: Promise made, promise fulfilled. I told you that whatever we are going to start, we are not going to leave it halfway. So, we have come here this afternoon to fulfill that promise.
“I am so excited, and I am so happy. I am leaving here with so much joy that we have done something that has so much impact, and importance in the lives of our people. So, I feel very fulfilled. Government is about the people. Government is knowing, understanding and seeing what you can do to make life easy for your people.
“We understand the situation of this road. Fortunately, I have a few friends who also live around here. So, there is nothing you will say that I don’t know. As a government, we will continue to do those things we know will make life easy for you.”
The Governor thanked members of the communities in the area for their support to his administration, and also for cooperating with the contractor to ensure completion of the project.
He assured the people that their request for the rehabilitation of the Community Secondary School and Health Centre, will be looked at and addressed immediately, saying, “Our government is a government that takes the interest of our people very seriously.
“There is no government without the people. It is only the people that keep the government going. So, what we will continue to do is to make sure that the problems and interest of our people are top on our list,” he assured.
Performing the inauguration, Taraba State Governor, Dr Agbu Kefas, said roads are not just physical infrastructure but represent a commitment to facilitate ease of transportation, boost local commercial activities and improve quality of lives for the people of Rivers State.
Dr Kefas noted that Governor Fubara has provided the people good roads, and like other good roads, it will serve as an artery of development, further connecting communities, enhancing access to essential services while unlocking economic potentials.
He said, “By completing this project, Your Excellency has, once again, demonstrated the transformative impact of visionary leadership. When I was coming in with the Governor on a ride, I saw the joy, the happiness of the voiceless people who were abandoned and neglected in this area, coming out to wave and welcome us.
“It wasn’t a hired crowd. Everybody, those who couldn’t make it to this place, in front of their homes, they were waving at us, and I was telling the Governor: this is all about good governance. He listened to the people, and solved their problems. So, it shows that he is doing the right thing, and I want to thank you, my brother, for what you are doing for the good people, especially the poor people even in difficult times.”
Governor Kefas further said: “As we celebrate this milestone, I am reminded of the importance of collaboration and shared vision among us as Governors. Together, we can inspire our people, improve their lives, and create lasting legacies in our respective states.”
Providing the project description, the State Commissioner for Works, Barrister Elloka Tasie-Amadi, recalled that when it was flagged-off in May, 2024, the project was for a 5km stretch but was extended in October, to include Mgbaraja axis, increasing the length to 6.55km, explaining that the 10.3 meter wide, and 5km of drains road, has now linked Apara Kingdom to Nkpor Kingdom.
In his address, Chairman of Obio/Akpor Local Government Area, Amb Chijioke Ihunwo, described the road as a very significant route that was abandoned for years until Governor Fubara intervened and fixed it, promising that Obio/Akpor people will not take the gestures of the State Government under Governor Fubara for granted.
Speaking on behalf of China Civil Engineering Construction Corporation (CCECC), the firm that handled the project, Eric Shen, said they are happy to be part of the infrastructure development strides of Governor Fubara, stating that though the rains posed significant challenge, they have delivered quality road network to serve the connectivity needs of the people.
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We’ll Implement Judicial Commission’s Report On Arson, Killings -Fubara …Says Such Violence Must Stop In Rivers
Rivers State Governor, Sir Siminalayi Fubara, has assured of implementing the recommendations of the report submitted to him by the Judicial Commission of Inquiry into the Arson, Killings, and Wanton Destruction of Property at some local government council headquarters on or around Monday, October 7, 2024.
Governor Fubara gave the assurance when the seven-member commission, led by the Chairman, Justice Ibiwengi Roseline Minakiri, submitted four volumes of reports of their investigation and recommendations to him at Government House in Port Harcourt, yesterday.
The Governor declared that his administration will neither tolerate nor allow such level of violence in the State anymore because it is not profitable or productive.
He said, “We are not going to be part of any system that would encourage any destruction in this State. And for that reason, we had to inaugurate this commission, so that this commission should look into the remote and immediate causes of this problem.
“And I believe that the recommendations of this commission, with the help of God and the support of everyone, we will make sure that we implement the recommendations.”
Governor Fubara said: “We are going to take it to the next stage. The report will be presented to the Executive Council, and there, we will surely come out with the White Paper and with the White Paper. I can assure you, we are going to follow it to the end.
“Nobody is above the law, including me. So, provided what we are doing is within the confines of the law, we will do it with the help of every one.”
Governor Fubara recalled how, before 2014, a group of persons had ran wide recklessly in the State, burning down court buildings.
He noted that it is such persons, who had recently surfaced with their destructive tendencies, and have extended the violence to local government councils, killing people and destroying government property.
Governor Fubara wondered why somebody will spend so much money to build a structure intended to last as legacy of the administration but would eventually be part of its destruction in the name of politics.
Governor Fubara clarified that he has never been part of such destructive politics that continue to set the State backwards and frustrate progressive development strides.
Governor Fubara said: “I make bold to say it, I have never been and will never be a party to anything that will bring shame, disgrace, destruction to our dear State.
“It is our State. If it is well with us, it will be well with everybody. As a matter of fact, why should I encourage destruction, when I know that when you finish spoiling things, you still need money to rebuild them.
“I am an accountant, I know the importance of how we can manage money. Rather than spoil, you should use that money to do a new thing for the State.”
Governor Fubara vowed: “So, I am going to ensure that we put a stop to that level of violence or such unreasonable violence. I call it unreasonable violence because it doesn’t mean anything in politics.
“Politics is a business of interest. There is no permanent friend, no permanent enemy. Some persons who were not even in our support, today, they are here following us because their interest is the most important thing.
“Likewise tomorrow, if the interest changes, they will also go their different ways. So, why burn down the house?”
Governor Fubara thanked members of the commission for being bold, focused, and accomplishing their task with determination in the face of physical and legal threats.
In her presentation, Chairman of the seven-member Judicial Commission of Inquiry, Justice Ibiwengi Roseline Minakiri, said they had put their findings into four volumes, including the recommendations.
Justice Minakiri explained: “We have here four volumes of the report. We have the memoranda, which is the memoranda we got after we made our publications.
“We also have the exhibits that came with the memoranda. We have the proceedings and the records. At the end of the day, we came up with the main report.”
Justice Minakiri advised that the recommendations of the report should be studied and implemented so that people can be deterred from such callous acts and the sought-after peace secured for the State.
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We Are Eager To Showcase The Best Of Rivers State -Fubara …Declares Federation Of Public Service Games Open
The Rivers State Government says it is committed to providing a memorable experience for all delegates participating in the Federation of Public Service Games(FEPSGA) hosted by the State Government.
Governor Siminalayi Fubara stated this during the opening Ceremony of the 43rd Edition, Public Service Games, titled ”Simplified Rivers 2024″, at Sharks Stadium, Port Harcourt, last Sunday.
Speaking through his Deputy, Prof. Ngozi Nma Odu, Governor Fubara said “Our hospitality is renowned and we are eager to showcase the best of Rivers State. From top-notch facilities to a secure environment, we have everything in place to ensure a seamless and enjoyable experience for all participants.”
Governor Fubara said to ensure the success of the games his Administration has put in place comprehensive plans and preparations with four venues approved for the events which include the Sharks Stadium, Alfred Diette -Spiff Civic Centre, Port Harcourt Club and the University of Port Harcourt.
The State Chief Executive urged participants to remember that the true spirit of FEPSGA goes beyond winning medals, stressing that it is about building bridges of friendship, fostering a sense of community and celebrating our diversity.
According to him, we envision a public service that is more productive, more efficient and more effective, a future where public servants are empowered to deliver exceptional results driven by a culture of excellence, innovation and teamwork.
The Governor reiterated that while a healthy mind and body are essential for high productivity, regular physical activity boosts our mood, increases energy levels and enhances our cognitive function. We are eager to showcase the best of Rivers State. From top-notch facilities to a secure environment.
In her address Head of the Civil Service of the Federation Mrs Didi Esther Walson-Jack, who spoke through Dr.(Mrs) Magdalene Ajani, Permanent Secretary in the Federal Ministry of Interior Commended Governor Fubara for hosting this year’s event, and for his dedication to promoting sports and fostering unity in the country.
She noted that the event which serves as a platform for furthering unity, camaraderie and sportsmanship amongst public servants, was a celebration of their shared commitment to excellence, resilience and service to the nation.
Also speaking the National President of the Federation of Public Service Games (FEPSGA), Comrade Amaebi Aloku, said Rivers State got the nod to host the annual event because the Federation was pleased with the vision of Governor Fubara in identifying with the needs of the Civil Servants in the State, in terms of their welfare and being one of the first State to implement the new minimum wage and even taking it above what was approved by the national.
Earlier the Head of Service Rivers State, Dr George Nwaeke had welcomed all participants to the State and expressed gratitude to the Governor for approving and making available the resources to host the games, noting that it was an opportunity to interact with all Civil Servants across the nation.