MTEF gets Senate approval
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The Senate has approved the 2017-2019 Medium Term Expenditure Frameworks (MTEF) and Fiscal Strategy Paper (FSP) containing parameters upon which the N7.289trillion 2017 budget is based.
Approval of the important national documents is coming three months after President Muhammadu Buhari forwarded it to the National Assembly for approval as templates upon which projections of the 2017 budget estimates are based. It will be recalled that the two strategic document was transmitted to both chambers the Legislature on 30th of September 2016.
Senate in approving the document through consideration of reports of its joint Committees on Finance, Appropriation and National Planning, however reviewed upward the $42.5 oil price benchmark proposed in the MTEF document for the 2017 budget projections to $44.5 from $42.5 proposed by the President but retained all the other parameters and projections in it as recommended by the committee.
Projections and parameters retained are the N305 to $1 US dollar as exchange rate, the 2.2million barrel oil production per day, the projected N5.122trillion for non oil revenue in the 2017 fiscal year.
Others are adoption of the projected N807.57billion as federal government independent revenue for 2017, adoption of borrowing plan for the year as proposed in the MTEF document etc.
On the need for diversification of the Nation’s economy, the Senate as recommended by the committee adopted the suggestion calling on federal government to implement drastic measures to achieve self-sufficiency and become an exporter of certain agricultural and mining products by increasing local production of maize, soya, poultry and livestock etc.
During general debate on the report before its passage, heated argument ensued among the senators over the adoption of the N305 to $1 as exchange rate .
While those against the parameter like Senators Ben Bruce (PDP Bayelsa East), Tayo Alasoadura (APC Ondo Central) etc, called for closing of the wide gap between the official rate(N305) and that of the parallel market which is close to N500 to stop the round tripping going on, those who supported its retention argued that the Central Bank of Nigeria (CBN) should be allowed to initiate measures of closing the gap as recommended in the report.
But the Deputy Senate President, Ike Ekweremadu who presided over the session expressed worry over the gap in its remarks after the passage of the document.
“We are worried with the huge gap between the parallel market and the official market and has been said by the chairman of appropriation, the central bank need to do something about it because it is one thing that is breeding corruption.
“We must find a way of bridging that gap and also stabilise the exchange rate so that investors can do its own forecast in terms of their investments.
We believe that something needs to be done in the area of the exchange rate”, he said.
He added that with the approval of the MTEF and FSP paper , the stage was now set for debate on the general principles of the 2017 budget by the senate next week.
