Former Vice President Atiku Abubakar has taken a swipe at the N13.08 trillion 2021 budget proposal submitted to the National Assembly by the President, Major General Muhammadu Buhari (retd.), on Thursday.
Atiku said proposals contained in the document contravene critical sections of the Fiscal Responsibility Act as such, the president and his team should recall and rework the document in the interest of the nation and its economy.
The former Vice President’s position was contained in a statement titled “The 2021 Budget Proposal Contravenes The Fiscal Responsibility Act,” he signed and made available to newsmen in Abuja, on Friday.
He said “I call on the President, to recall this budget, and recalibrate it to reflect the provisions of the Fiscal Responsibility Act of 2007, and the current economic realities of the nation. To do otherwise will not only be unpatriotic, it will also be catastrophic for our nation’s economy.”
According to him, a careful study of the 2021 Budget raises a number of “very grave and perhaps, disturbing issues” which he noted that space and time constraints made it difficult for him to list them all in a single intervention.
Atiku said “The budget deficit in the proposal is ₦5.21 trillion. This amount is just over 3.5% of Nigeria’s 2019 GDP. This is contrary to the Fiscal Responsibility Act of 2007, which provides in Part II, Section 12, subsection 1 that: ’Aggregate Expenditure and the Aggregate amount appropriated by the National Assembly for each financial year shall not be more than the estimated aggregate revenue plus a deficit, not exceeding three per cent of the estimated Gross Domestic Product or any sustainable percentage as may be determined by the national Assembly for each financial year.”
“Nigeria had a GDP of approximately $447 billion in 2019. Three percent (3%) of this amount is $13. 3 billion, which at the current official exchange rate of ₦379 to $1, gives you a figure of ₦5.07 trillion.
“So, clearly, the budget deficit of ₦5.21 trillion, as announced by President Muhammadu, is above 3% of our GDP and is therefore in contravention of the Fiscal Responsibility Act of 2007.”
Atiku, who was the presidential candidate of the opposition Peoples Democratic Party, in the 2019 general elections, further said “Even more disturbing is the fact that our GDP has fallen sharply from its 2019 figures, and has been projected by the World Bank and other multilateral institutions at somewhere between $400 billion and $350 billion. Meaning that in actual sense, the ₦5.21 trillion budget deficit is actually far above the 3% threshold stipulated by the FRA.
“That this escaped the notice of the Buhari administration shows a glaring lack of rigour in the formulation of the Budget. A very disturbing development.
“Furthermore, this deficit shows the precarious state of our national finances, which have since been overburdened by excessive borrowing on the part of the Buhari administration.”
The former Vice President also noted that the Fiscal Responsibility Act of 2007 makes provision for the National Assembly to raise the threshold of the budget deficit from 3% to a higher figure.
He, however, said “If this is done, they will be serving this administration’s interests, not Nigeria’s, because the Act says that such a threshold must be sustainable. Is it sustainable when our budget makes almost as much provision for debt servicing, as it does for capital expenditure?”
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