The Minister of Budget and National Planning, Senator Udoma Udo Udoma, has affirmed that revenue mobilisation is cardinal for the government to achieve intended results as encapsulated in the (2017-2020) medium-term Economic Recovery and Growth Plan (ERGP).
Udoma stated that mobilisation of substantial increases in government revenues over the life of the ERGP was a major pillar for its success, declaring that â€œrevenue mobilisation is therefore our number one priority.â€
Speaking at a â€˜Stakeholdersâ€™ Engagement on the ERGP Implementation Roadmapâ€™ in Abuja yesterday with experts drawn from both private and public sectors of the economy, the minister noted that the IMF/World Bank had projected that Nigeria will be moving back to a positive growth trajectory of 0.8 per cent this year.
â€œWhile this is much lower than our target of 2.19 per cent by the end of this year in the ERGP, it underscores one fact: all projections indicate that we will be climbing out of recession this year. Recent reports by the NBS (National Bureau of Statistics) confirm that inflation rate has been trending downwards in the past two months.
â€œOur agricultural sector, one of the key sectors expected to drive growth in our Plan, continues to show growth. These positive results and projections, though modest, are all evidence that our economic policies are the right ones. However, much more needs to be done to sustain and build on this momentum. We are not out of the woods yet,â€ he said.
The minister emphasised that the government was not just determined to restore growth, but one that is diversified, inclusive and sustained in the long term, irrespective of whatever happens to the price of crude oil at the global market.
He said: â€œAnd that is the importance of the ERGP. The Plan sets out what we need to do to achieve all these. In particular, the ERGP indicates that to achieve sustained growth we must continue our current initiatives aimed at driving fiscal stimulus through a package of spending to stimulate private consumption and investments by businesses.
â€œThis is why our 2017 budget proposal has dedicated 30 per cent of the budget to capital expenditure. We intend to achieve a minimum capital expenditure allocation of 30 per cent in subsequent budgets throughout the life of the plan. To do this, we must improve our revenue base so that we donâ€™t continue to rely on borrowing to fund our capital budgets. As we improve our revenue, we will be able to bring down our debt service to revenue ratio, which rose sharply when our revenues dipped,â€ he stated.
As indicated in the ERGP, the minister pointed out that revenue mobilisation efforts would involve, among others, introducing measures to increase independent revenues from revenue generating agencies, as well as cutting out waste by intensifying current efforts to plug revenue leakages and inefficiencies in government spending.
â€œIn the ERGP, the government has also committed itself to exploring options to generate additional revenues by the restructuring and privatisation of carefully selected public enterprises. But, most importantly, the ERGP states that we will be taking measures to expand our tax to GDP ratio from the current six per cent of GDP to at least 15 per cent of GDP. We are already working on these tax review initiatives.
â€œThe immediate focus of this government is therefore on revenue enhancement. For the ERGP to achieve its intended results, we must be able to mobilise substantial increases in government revenues over the life of the Plan. Revenue mobilisation is therefore our number one priority,â€ he said.
Udoma stated that the administration was pursuing a path that will move Nigeria away from a jobless growth driven mainly by petroleum revenues to an inclusive and broad-based growth, adding that President Muhammadu Buhari had repeatedly emphasized that the ERGP is this governmentâ€™s â€œblueprint aimed at building a new Nigeria where we grow what we eat, consume what we make and produce what we use.â€
â€œLadies and gentlemen, I must say that this administration is very encouraged by the positive feedback we have been receiving on the ERGP. We thank Nigerians for all the words of encouragement. Also, internationally, the ERGP has been well received. I have just returned from a visit to the United States of America, during which I attended the World Bank/ IMF Spring meetings.
â€œMost of the comments we received there were very encouraging.
However, we cannot enjoy the benefits of the ERGP unless it is effectively and faithfully implemented. Ladies and gentlemen, I must admit that as a country, our track record on implementation of our plans has not been very good. Conscious of this, the ERGP has dedicated a section, Section 7, to implementation. Just a reminder of what it says.
â€œFirstly, we must focus on our priorities. Secondly, we must establish clear accountability. Thirdly, we must set targets and develop detailed action plans. Fourthly, we must mobilise and allocate resources to the priorities. Fifthly, we must create an enabling policy and regulatory environment. And, finally, we must set up delivery unit, or units, to monitor and drive progress,â€ he said.
Udoma disclosed that the process of developing a detailed implementation road-map had already commenced, adding that this will lay out the roadmap for a step by step delivery of each of the strategies.
â€œEach strategy will be further broken down into component activities, sub-activities and actions. Each action will be supported by clearly assigned responsibilities, which will be sequenced against clear milestones and timelines for ease of monitoring. We have also commenced the process of establishing a Delivery Unit, as well as Implementation Units, to facilitate the effective implementation of the plan. This is to be complemented with the establishment of special task forces on the key execution areas of the plan,â€ he stressed.
Speaking on why consultations and dialogue with stakeholders was necessary, he said: â€œBefore we go too far down the implementation road, we felt that we should gather experts and stakeholders for further consultations. As a government, we believe that we can only succeed in transforming Nigeria if we work closely with stakeholders.
â€œThis is the first of many consultative processes we will be holding on plan implementation, as well as to get feedback from stakeholders. Just as the ERGP was developed through an extensive consultative process to ensure collective ownership, plan implementation will involve constant and continuous dialogue and consultations with relevant stakeholders. Todayâ€™s gathering is therefore the first of many dialogue sessions this ministry, and indeed, the government, as a whole, will be conducting to obtain citizensâ€™ participation in the collective endeavor of transforming Nigeria,â€ Udoma stated.