Senate Postpones MTEF Passage over Fears on OPEC Oil Cuts

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Senators caution against rising debt profile
Damilola Oyedele in Abuja

The Senate Thursday postponed the consideration and passage of the 2018-2020 Medium Term Expenditure Frame work/Fiscal Strategy Paper (MTEF/FSP) to next Tuesday, to await the outcome of the meeting of the Organisation of Petroleum Exporting Countries (OPEC) in Vienna, Austria.

There are fears that the organisation might cut Nigeria’s oil output to 1.8 million barrels per day. The MTEF, which forms the basis of the 2018 N8.612 trillion budget proposal, projects 2.3mbpd oil output.

The 2018 Appropriation bill can pass only through second reading and be committed to committees after MTEF has been passed by both chambers of the National Assembly.

Senate Leader, Senator Ahmed Lawan, urged lawmakers to be patient for the outcome of the meeting.
“We need to know what the production quota for Nigeria will be so that we will take a very informed and enlightened decision on the daily production for our crude. I believe that this is strong and enough ground for us to stand down the consideration of this report until next Tuesday,” he said.

Lawan on Wednesday afternoon had however argued for the consideration of the documents even though two of his colleagues had maintained that most lawmakers had already left the chamber, and that such a ‘critical document” required a full house.

“We are racing against time,” he had said.
Deputy President of the Senate, Ike Ekweremadu, who presided briefly over the plenary, said awaiting the outcome from OPEC is very important.

“It is important that we wait and see the outcome of the OPEC meeting today regarding production quota. That (volume of) export will determine what will be the benchmark ultimately. I just want to appeal that we support the prayer that we step down the consideration of this report so that by the time we come back on Tuesday, we will be able to have all the necessary information that will enable an informed decision on the matter,” Ekweremadu said.

The lawmakers subsequently voted to postpone the consideration of the document.
Speaking during the continuation of debate on the details of the budget, Senator Rabiu Kwankwaso (Kano APC) indicated that the oil benchmark may be adjusted.

Kwankwaso, who chairs the Senate Committee on National Planning and Economic Affairs, said he is in talk with the Chairmen of the Committees on Finance (Senator John Enoh) and Appropriation (Senator Danjuma Goje) on the benchmark of $45pb.
The lawmaker also expressed his opposition to borrowing, whether locally or internationally, unless it is extremely important.

“It is necessary to avoid death trap, which is possible to get into if care is not taken,” he said.
Similarly Senator Ali Wakili (Bauchi APC) also called for caution regarding borrowing and urged the government to look inwards.
Wakili said over N1.2trillion from the collection of stamp duties is lying idle at the Central Bank of Nigeria (CBN).

Why don’t we deploy it, he queried.
He further explained that some agencies of the government can be self sustaining, if they are allowed to run as self sustaining entities, which would reduce the cost of governance.
Presiding, Senate President Bukola Saraki also reiterated that there are concerns on the assumptions of MTEF, which extend to the 2018 budget.
He said the document would be considered next Tuesday and then “hopefully passed”, before the budget proposal passes second reading.