How Nigeria plans to fund N5.01trn budget deficit through new borrowing, proceeds from privatisations and drawdowns on loans
The Rural Electrification Agency, (REA), a body charged with electrification of rural and unserved communities in Nigeria, is set to spend over a billion Naira (USD 2.4 million) on payment of salaries, Refreshment, Welfare Packages among others in 2022.
Platforms Africa, which exclusively gathered this, reports that the spending pattern is also contained in the breakdown of the 2022 Appropriation Bill currently before the National Assembly.
Recall that President Buhari proposed a record NGN16.39 trillion naira (USD39.8 billion) budget to the National Assembly with a crude oil benchmark price of USD57 per barrel and a daily oil production estimate of 1.88 million barrels (inclusive of condensates of 300,000 to 400,000 barrels per day).
The deficit will rise to N5.01 trillion, or 3.39 per cent of GDP to be funded by new borrowing, proceeds from privatisations and drawdowns on loans secured for specific projects, the president told a joint sitting of the Senate and the House of Representatives.
According to details of the 2022 budget proposal obtained by Platforms Africa, REA proposes to spend NGN950, 069,260 on salary and wages, an increase of about N25 million from NGN926,717,629 budgeted for 2021.
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Breakdown of REA’s 2022 Spending
A further breakdown of the budget obtained by Platforms Africa reveals the following: Travel and Transport N81,107,250 as against N21,107,250 in the previous year.
The sum of N16, 859, 913 was earmarked as Welfare Packages against N11,859,913 in 2021.
It also shows Refreshment and Meals will gulp N4, 109, 838 from N2,109,838 in 2021.
The sum of N5,440, 000 was allocated to Honorarium and Seating Allowance as against N3,440,000 in 2021.
Industry watchers told Platforms Africa the cost of governance in Nigeria is too high and unsustainable.
The secretary to the government of the federation, Boss Mustapha had last week said the federal government spent 60 per cent of its overhead expenditure on travels, maintenance, welfare and stationery in three years.
“Government is highly worried that about 60 per cent of Federal Government’s Overhead Expenditure in three years (2012 to 2014) was spent on travels, maintenance, local and international training, welfare, office stationery / consumables, honoraria etc. Recent data from the Budget Office indicates that “actual MDAs recurrent spending is still on the rise viz. from N3.61 trillion in 2015 to N5.26 trillion in 2018 and N7.91 trillion in 2020.
President Muhammadu Buhari’s Administration, has, therefore, been unrelenting in making sure that our little resources will no longer be budgeted and/or used for frivolities, hidden in fake projects, unnecessary travel, wasteful overhead costs, meaningless capital projects and remuneration of ghost workers.
