Buhari Votes N305bn for Petrol Subsidy in N8.83tn 2019 Budget

  • Says technical committee to advise on minimum wage
  • APC, PDP trade words over heckling of president

Deji Elumoye, Onyebuchi Ezigbo, Shola Oyeyipo, Adedayo Akinwale, Mercy Apollos in Abuja and Nume Ekeghe in Lagos

The vexed issue of subsidy for petrol was a significant part of President Muhammadu Buhari’s presentation of 2019 financial estimates to the National Assembly Wednesday, with the president earmarking N305 billion, out of his proposed N8.83 trillion spending plan, for the essential commodity.

The president told the 469-member National Assembly at the House of Representatives Chambers that government would continue to subsidise fuel price in order to reduce its burden on the citizenry.

The president’s decision, is, however, likely to generate anxiety among the nation’s 36 governors, who had in recent times opposed subsidy deduction from the Federation Account, arguing that it had remained a shadowy drain on their monthly allocation.

According to him, “We have allowed for N305 billion ($1 billion) for under-recovery by NNPC on PMS (premium motor spirit or petrol) in 2019. We will continue working to bring it downwards so that such resources are freed up to meet the developmental needs of our people.”

The president attributed the problem with subsidies in the past to abuse and corruption, adding, however, that because government through the NNPC is the sole importer of PMS, under-recovery is from the NNPC’s trading account.

He said this means the possibility of some marketers falsifying claims has been removed.

The 2019 budget estimate is N300 billion lower than the N9.1 billion being implemented for 2018 fiscal year.

According to Buhari, N4.04 trillion or 50.31 per cent is earmarked for recurrent expenditure and N2.03 trillion representing 22.98 per cent for capital projects.

Other estimates are N492.36 billion for statutory transfers, N2.14 trillion for debt servicing and provision of N120 billion as sinking fund.

He explained that the sinking fund would be used to “retire maturing bonds to local contractors.”

The 2019 budget proposal is based on an oil production estimate of 2.3 million barrels per day and an exchange rate of N305 per dollar.

Other benchmarks are real Gross Domestic Product (GDP) growth rate of 3.01 per cent and inflation rate of 9.98 per cent.

The total projected revenue, according to the president, is N6.97 trillion, which is three per cent lower than the 2018 estimate of N7.17 trillion.

Buhari said the expected income consisted of oil revenue projected at N3.73 trillion, and non-oil revenue estimated at N1.39 trillion.

He explained, “The estimate from non-oil revenue consists of N799.52 billion from company income tax; N229.34 billion from value added tax, and customs duties of N302.5 billion. We have reduced our expectations from independent revenue N624.58 billion.

“Other revenues expected in 2019 include various recoveries of N203.38 billion; N710 billion as proceeds from the restructuring of government equity in joint ventures, and other sundry incomes of N104.1 billion.”

The president explained further that the total N8.83 trillion proposed expenditure for 2019 included grants and donor funds amounting to N209.92 billion.

According to him, although the 2019 estimate was lower than the 2018 budget of N9.1 trillion, it was higher than the N8.6 trillion originally proposed by the executive to the National Assembly.

The budget deficit is projected to decrease to N1.86 trillion or 1.3 per cent of the GDP in 2019 from N1.95 trillion projected for 2018.

“This reduction is in line with our plan to progressively reduce deficit and borrowings over the medium term,” he said.

On sectoral allocation, the president said the Ministry of Interior would get N569.07billion, Defence (N435.62 billion), Education (N462.24 billion) and Health (N315.62 billion).

To Set up Technical Committee on Minimum Wage

On the contentious issue of new minimum wage, Buhari revealed that a technical committee is to be constituted to advise government on mode of funding workers’ wage increase.

He said, “I am committed to addressing the issue of a new minimum wage and I will be sending a bill to the National Assembly on this. However, in order to avoid a fiscal crisis for the federal government, as well as the States, it is important to devise ways to ensure that its implementation does not lead to an increase in the level of borrowing.

“I am accordingly setting up a high-powered technical committee to advise on ways of funding an increase in the minimum wage, and the attendant wage adjustments, without having to resort to additional borrowings.

“The work of this technical committee will be the basis of a Finance Bill, which will be submitted to the National Assembly, alongside the Minimum Wage Bill. In addition, the technical committee will recommend modalities for the implementation of the new minimum wage in such a manner as to minimise its inflationary impact, as well as ensure that its introduction does not lead to job losses.”

Indication that the presentation will be rowdy emerged when the gallery of the House of Representatives, where the session was held was cleared for lawmakers to dissolve into an executive session.

There were feelers that it was an attempt to give the president free passage during the presentation.

Though Speaker Dogara said the executive session would only last five minutes, it went on for more than 20 minutes in what was an attempt to ensure that Buhari was well-received.

APC and the PDP lawmakers had earlier met on Tuesday ahead of yesterday’s budget presentation to put finishing touches to how to receive the president.

There was confusion on the floor immediately the president stepped into the House chambers as opposition PDP lawmakers started singing protest songs.

The already prepared APC members also hailed the president, assuring him that he would have another four-year tenure.

While the APC lawmakers were chanting ‘Sai Baba,’ the PDP lawmakers persisted with their song ‘freedom come by struggle.’

PDP lawmakers who were disenchanted and were apparently set for showdown continued singing their protest song ‘freedom comes by struggle,’ repeatedly, making the chamber noisy and rowdy.

Occasionally, they disrupted the president’s speech, making him stop as long as their noises persisted.

No sooner had the sitting began than fighting broke out between a PDP lawmaker and his APC counterpart in the House Chambers.

Hon. Bashir Babale of APC was engaged in physical brawl with PDP lawmaker, Hon. Douye Diri, who was preparing placards with which they planned to protest.

The lawmakers booed the Majority Leader, Hon. Femi Gbajabiamila, when he called the Deputy Senate President, Senator Ike Ekweremadu, aside apparently to implore him to pacify PDP members to discontinue their aggression.

Senators too were not exempted as disagreement between Senators Sam Anyanwu and Godswill Akpabio got the two lawmakers to stand up to each other.

Bothered by the open confrontation by the lawmakers, Buhari at a point cautioned the lawmakers saying, “The world is watching us and we are supposed to be above this.”

The drama however, continued as lawmakers booed and hailed the president as he enumerated some of the achievements of his government.

They shouted words such as: ‘It’s a lie! Ah! Iro lo pa (You are lying), propaganda.”

In a deliberate attempt to disturb the president’s speech, some members tampered with the microphone to create noise.

The Sergeant-at-Arm had to direct that the microphone be put off to stop the noise.

While some lawmakers stood up to give the president a clap, some others heckled him shouting, ‘Lies, propaganda’.

One of the lawmakers called Buhari, ‘grass cutter’ in reference to the scandal, which the immediate past Secretary to the Government of the Federation (SGF), Babachir Lawal, was involved.

As the president was stating how his administration was fighting corruption, some lawmakers shouted him down, saying, ‘propaganda, which corruption are you fighting’? ‘Grass cutter’

When the Buhari concluded his speech, the session turned rowdy again.

Before Saraki and Dogara could present their speeches, APC lawmakers chanted ‘four more years,’ while their PDP counterparts screamed, ‘no more years.’

After more than 10 minutes into the drama, the Presidential Guards Brigade band began to play the National Anthem signalling the end of the programme, while Buhari was still seated.

The ceremony ended without Saraki and Dogara presenting their speeches.

Security operatives whisked the president out of the chamber leaving the lawmakers behind.

Meanwhile, protesting workers under the umbrella of Parliamentary Staff Association of Nigeria (PASAN) stayed off the National Assembly in continuation of their four-day warning strike that began on Monday.

The budget presentation, however, held amid water-tight security. All entrances leading to the complex were barricaded with multi-agency security operatives manning the gates and thoroughly scrutinising those coming in.

Officers of the Nigeria Police Force, Department of State Services and other sister agencies were on the ground ahead of the president’s budget presentation, which kicked off at 12.40p.m.

Mixed Reactions Trail Buhari’s 2019 Budget Presentation

National Assembly members wednesday reacted to the 2019 federal budget estimates presented by the president with mixed feelings.

While some legislators gave the president thumbs up for the N8.83 trillion budget proposed for next fiscal year, others condemned the Appropriation Bill in its entirety.

In his reaction, Senate Leader, Senator Ahmad Lawan, while frowning at the unruly behaviour of some lawmakers while the president’s budget presentation lasted, however, saluted the courage of Buhari for coming up with a budget of hope. He assured that the legislature would scrutinise the proposals with a view to ensuring that the Appropriation Bill was passed in a record time.

Also reacting, Senate Minority Leader, Senator Biodun Olujimi, emphasised that the budget appears to be hopeless but was quick to state that the parliament will do a thorough job before passing the Appropriation Bill.

On his part, Senate Chief Whip, Senator Olusola Adeyeye, described the budget estimates as one that will turn things round for the better in 2019.

Chairman of the Senate Committee on Privatisation, Senator Ben Murray- Bruce, on his part, condemned the budget proposal in its entirety saying the budget has less vote for capital expenditure.

Also reacting, Chairman of Senate Committee on Local Content, Senator Adeola Solomon, said the budget is truly the budget for the next level of economic development for the first time in Nigerian history.

A member of the House of Representatives, Hon. Olajide Olatunbosun, representing Saki West/East/Atisbo federal constituency of Oyo State said Buhari’s budget is implementable. He expressed optimism that with the administration’s frugal attitude, it would be enough for it to do more.

The PDP caucus in the House, however, disagreed with the budget presented by the president.

Led by the Deputy Minority Leader, Hon. Chukwuma Onyema (Anambra, PDP), the opposition leaders said the annual budget presentation of multi-trillion naira budget by the government has become a “hollow ritual it began in 2015,” and which has had no meaningful impact on Nigerians.

According to the lawmakers, “Again, the Buhari administration has tabled another and again, this hollow ritual it began in 2015 may soon be followed, as usual, with excuses for non-performance.

“Again too, as it has always done, the APC government known for its unique ideology of ‘blame-ology’ will start apportioning of blames to all else, except itself.”

Some economists and analysts also said the 2019 Appropriation Bill will not have any significant impact on the standard of living in the country.

They said this in separate interview with THISDAY.

To the Chief Executive Officer of FactBox Company, and an expert in data and information analysis, Mr. Jide Ogunsanwo, said the contents of the 2019 proposed budget estimates does not have what is required to alleviate poverty in the country.

He said, “When the 2018 budget was passed, Nigeria’s population was 195 million. In simple terms, last year’s budget was the equivalent of an average of N127 per person every day.

“Now, we have a lower budget for 2019 and the population has risen to 200 million, which is N120 per person per day.

“So, it is significantly lower than last year’s budget. If at N127 per person last year, more people got into poverty, what do we think will happen when we have a lower budget? So, in simple terms, this budget will not reduce the number of poverty in the country.”

To the Chief Executive Officer, Financial Derivatives Company Limited, Mr. Bismarck Rewane, noted that the impact of the current year’s budget hasn’t been significant.

He said, “The price of oil is the problem. Typically, over the years, the price of crude oil has always been about 20 per cent below the spot price, but today the spot price is lower than the benchmark price and with that, the benchmark price becomes meaningless.

“So, we need to reduce that and increase the deficit. We need to expand the expenditure. So, we are between a rock and a hard place. To me, what is inevitable and imminent is that there would be a supplementary budget.”

Also, a senior lecturer at the Lagos Business School, Dr. Bongo Adi, said, “There is a very huge discrepancy between the budget allocated and what is given to the ministries by the government. I don’t know how we can deal with that situation because it seems like the budgeting system has also become politicised.”

APC, PDP Trade Words over Heckling of President

The nation’s two leading political parties, the All Progressives Congress (APC) and the Peoples Democratic Party (PDP), Wednesday traded words over the heckling of President Muhammadu Buhari during his presentation of the 2019 Appropriation Bill to the National Assembly in Abuja.

The president had presented the N8.83 trillion financial estimates for 2019 amidst cheering from his APC lawmakers and jeering from the opposition-led PDP legislators.

Both Senate President Bukola Saraki, who presided over proceedings, and Speaker Yakubu Dogara could do little about the situation as both parties made Buhari’s outing uncomfortable.

Reacting to the incident, the APC said the PDP legislators’ conduct was disgraceful and unbecoming of their status as lawmakers of the federal republic.

The PDP, however, retorted, saying his members were entitled to show their displeasure at what it called the compound failure of the APC-led administration.

In a statement by its National Publicity Secretary, Mallam Lanre Isa-Onilu, APC said by law, respect for the Office of the President or Head of Government in any clime is not a matter of choice but a civic obligation sanctioned by laws.

“We condemn in strong terms the action by lawmakers of the Peoples Democratic Party (PDP) during the presentation of the 2019 budget by President Mohammadu Buhari on Wednesday,” it said.

APC said PDP should be aware that the disgraceful conduct and actions of its legislative caucus has succeeded in eroding the remnant of the public’s respect, (if any) that the party has in the eyes of any respectable Nigerian.

According to APC, the action has further confirmed its unsavoury image in the eyes of well-meaning Nigerians, that the party is largely populated by self-serving and unpatriotic members, whose sole aim in politics is to promote their self-interests at the expense of the country’s interests.

“By law, respect for the office of the president or head of government in any clime is not a matter of choice but a civic obligation sanctioned by laws. Being an opposition party or critic is no licence for such wayward conduct by the PDP legislative caucus; most especially against the president of the country,” it said.

Expectedly, the PDP responded in kind through National Publicity Secretary, Mr. Kola Ologbondiyan, who said, at a press conference in Abuja, that the jeering showed that Mr. President no longer enjoys the support of Nigerians across the country, adding that he no longer has any political foothold and could only awaits a crushing defeat in the 2019 general election.

According to the PDP, the spontaneous action of the lawmakers, at the joint session of the National Assembly, was a resounding and unambiguous vote of no confidence and unmistaken expression of Buhari’s rejection by the Nigerian public, across the divides, who are fed up with his incompetent, divisive and corrupt administration.

It said, “What else do Nigerians want from a president, who has openly confessed his lack of capacity to find solutions to the myriads of problems his administration brought and on that note promised Nigerians more sufferings and hardship in the coming year?

“This is more so as his scripted presentation at the budget session was full of false performance indices, claims of non-existent projects, half-truths, bogus fiscal projections, beguilement and new list of fake promises, which Nigerians have since seen through.”

The president had waded through his harassment, presenting his estimates, a key component of which was the N305 billion earmarked for the payment of fuel subsidy claims during the fiscal year, the first of such allocation since the administration took over in 2015.

Buhari also used the opportunity of the budget presentation to unveil his plan to set up a technical committee to advise the federal government on the mode of funding impending workers’ wage increase.

The presentation, which lasted for about 50 minutes was marred by hailing and booing by senators and House members.