FG to cut budget by N300bn in 2014

The Federal Government is planning to cut the 2014 budget by N300bn, down from the current N4.9trn it budgeted for this year. The Director-General of the Budget Office, Dr. Bright Okogu, disclosed this in Abuja on Friday when he received members of the House of Representatives Committee on Appropriation on oversight visit to his office. Okogu said the proposed 2014 budget stood at N4.6trn at the moment. He informed the committee that dwindling oil and non-oil revenues had forced government to consider the option of planning for less expenditure next year. He claimed that falling crude oil prices and disruption of supplies by vandals were affecting government’s revenue from oil. “The Price of Bonny Light Crude is down from $ 118.81 per barrel in February 2013 to$112.1 per barrel as at 23, September 2013. “Nigeria will run current account deficit if oil prices drop below $86 per barrel”, Okogu argued. On disruption of supplies, he stated, “Disruptions to Nigeria’s oil production and losses of almost 400,000 bpd was recorded in the first half of the year. “Insecurity in some parts of the country continues to affect non-oil revenue generation and collection. “The Federal Inland Revenue Service has told us that they have not been able to collect tax in some areas of their jurisdiction because of insecurity.” On how non-oil revenue recorded a drop, the director-general explained, “The recent increase in import levies and duties on importation of rice to discourage importation and boost production of rice locally has seen an
increase in production from between 400 to 500, 000 tonnes to 1.3million tonnes. “This has its reverse side, which has hit our revenue because people are not importing and therefore, the duty we have on this has been lower.” However, he told the committee that 76.83 per cent of the capital component of the 2013 budget had been implemented. Okogu said N475bn, out of the N618bn released so far had been cash-backed. “The utilisation rates as at the end of July is 76.83 per cent with same rate cash-backing percentage”, he added. On the constituency projects of lawmakers, he informed the committee that N95bn, out of the
N100bn budgeted for the projects had been released by government. The Chairman of the committee, Mr. John Enoh, had said that the members made the Budget Office the first point of call because they wanted to get accurate figures on releases for capital projects.