The Senate at its sitting on Wednesday, 5 October 2022, considered and approved the report of its Joint Committee on Finance and National Planning and Economic Affairs on the 2023-2025 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) ahead of the 2023 Budget presentation scheduled to hold on Friday, 7 October 2022.
Presenting the report of the Joint Committee, the Chairman, Sen. Solomon Olamilekan Adeola (APC: Lagos) stated that the 2023-2025 MTEF/FSP is a multi-year planning tool that is designed to highlight the implementation of the National Development Plan 2021- 2025, communicate the developmental plans of the government over the period of 2023-2025 and highlights the fiscal parameters and assumptions for the preparation of the annual budget.
Speaking on the legislative activity of the Joint Committee, Sen. Adeola explained that a 5-day public hearing on the 2023-2025 MTEF/FSP was conducted to avail Government Owned Enterprises (GOEs), Revenue Generating Agencies, the Ministries of Finance, Budget and National planning as well as the Budget Office the opportunity to present justifications on their economic and fiscal estimates; enable scrutiny of the revenue pattern contained therein; review revenue performance for the year 2020-2022 and revenue projections for the year 2023-2025.
In his submissions, Sen. Adeola explained that outcomes and deliberations from the public hearing indicated that higher waiver and tax exemptions for corporate entities contributed significantly to the prevalent budget deficit; that some revenue generating agencies spent Internally Generally Revenue (IGR) without approval and not making full remittances into the Consolidated Revenue Fund (CRF) account.
In view of the aforementioned observations, Sen. Adeola urged the Senate to consider and approve the following as parameters for the 2023 Federal Government Revenue and Expenditure Framework as contained in the 2023-2025 MTEF/FSP:
- Daily Crude Oil Production: 1.69mbpd for 2021, 1.83mbpd for 2022 and 1.83mbpd
- Benchmark Oil Price: $73/barrel as a result of continuous increase in the oil price in the global oil market and other peculiar situations.
- Exchange Rate: N437.57/ $1
- GDP growth rate: 3.75%
- Inflation growth rate: 17.16%
- Projected New Borrowings: N8.437 trillion subjects to the approval of the provisions of details of the borrowing plan to the National Assembly
- Federal Government Retained Revenue: N9.352 trillion as a result of increase in the benchmark as the ceiling oil subsidy.
- Statutory Transfers: N722.11 Billion
- Debt Service: N6.31 trillion
- Sinking Fund: N247.73 Billion
- Pension, Gratuities and Retirees Benefits: N827.8 billion
- Aggregate FGN Expenditure: N19.76trillion comprising of:
- Total Re-current (Non-debt): N8.53 Trillion
- Personnel Costs (MDAs): N827.8billion
- Capital Expenditure (exclusive of Transfers): N3.96trillion
- Special Intervention (Recurrent): N350billion
- Special Intervention (Capital): N7billion
- Cost of Petroleum Subsidy capped at N1.7trillion
Following the debates and submission of lawmakers on the cost of petroleum subsidy, the Senate approved the sum of N3.6 trillion as presented by President Muhammad Buhari in the 2023-2025 MTEF/FSP. In the House of Representatives, the 2023-2025 MTEF/FSP was considered and approved at the plenary session of Thursday, 6 October 2022.
