Senate declares MTEF 2017-2019 unrealistic

The 2017, 2018, and 2019 Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP) by President Muhammadu Buhari received an all-round bashing on Wednesday as Senators described it as flawed, unrealistic and hence incapable of taking Nigeria out of recession as desired.

The position by the Senate on the MTEF document may have thrown a spanner on issues in the 2017 Budget which President Muhammadu Buhari is to present to the joint sitting of the National Assembly next week. Senators while condemning the MTEF said the projections in the document contained inaccurate indices, which they noted would make the 2017 budget un-implementable if passed. Against this background, the Senate resolved to commit the MTEF document to its Committees on Finance, Appropriation and Budget and National Planning for rework, while relevant authorities from the Ministry of Finance, Central Bank of Nigeria, Budget and National Planning and others should be invited to be part of the rework process.

Meanwhile, the Senate Minority Leader, Senator Godswill Akpabio (Akwa Ibom North West) offered a suggestion, which gave a soft landing for President Buhari on the MTEF document. Akpabio in his contribution said since the President was already Billed to present the 2017 Budget to the National Assembly next Week, it would not be advisable for the Senate to sent back the MTEF document to the executive, but should rather empower the Committees perfect the document with all relevant authorities for the President to act upon before addressing the lawmakers.

Alluding to an earlier hint by the Senate President, Akpabio said, “Yesterday, you made reference to the fact that the President may be coming to the chambers to submit and read the 2017 budget on 1st of December (Next week Thursday). If that is the case and we send this (MTEF) back for reworking by the presidency, it means that we will not be able to meet that deadline. “But if we send it to the committee level, they may come up with something within the next three days that will be much, much realistic ahead of the budget presentation itself”. Akpabio pleaded with the Senate not to throw out the MTEF document based on the incongruities in the projections, thus stressing the need to commit the document to the Committees for proper work.

“We can see that we don’t have a perfect document in our hands but of course we are looking at assumptions and assumptions may not necessarily be correct. I want to suggest that we send it to the committee. “Of course, the committees will invite the relevant agencies and ministries of government. And they will come up with a more realistic MTEF/FSP. So, my appeal will be that the committee members should take into cognisance all the submissions and observations made today; so that we can come up with a more realistic MTEF and FSP”. Earlier, Senators like Dino Melaye (APC Kogi West), Bayero Nafada (APC Gombe North), Adeola Olamilekan (APC Lagos West), Mohammed Hassan (PDP Yobe South), Emmanuel Paulker (PDP Bayelsa Central) , Abiodun Olujimi (PDP Ekiti South) and others, dismissed the projections made in the document and argued for it to be sent back to the Presidency.

The Senators described the 2.2million barrel per day oil production as against current 1.6million barrel per day production as unrealistic and unsuitable for the 2017 budget. They also dismissed the exchange rate of N290 to a U.S dollar as against N305 to a dollar officially announced by the Central Bank Governor, Godwin Emefiele, two days ago. The Senators also contended that estimation of 3.02% GDP growth rate for 2017 may not be tenable given that the projected growth rate in the current fiscal year stands at – 2.44% growth rate from – 2.06% it was during the second quarter as a result of recession.

While Melaye on account of the alleged unrealistic assumptions of the MTEF document described it as a fraud, Adeola Olamilekan declared that the economic team of President Buhari was in disarray. “The GDP is going down and this MTEF document is telling me that it is going up. So, how do you corroborate this fraud? We should not be talking about deficit to GDP in realistic term we should be talking about deficit to revenue”, said Senator Melaye. In a fit of anger, Senator Olamilekan said, “This document we have before us is no document. We should return it to them. “The Economic Team of the President is in disarray.

I say this without being sentimental; I say as a true Nigerian, I say it because I want the best for my country.” Senator Biodun Olujimi described MTEF as voodoo by design, averring that the glaring shortcomings on the projections were an indication that those who prepared the document are incompetent. However, some other Senators like Ahmad Lawan (APC Yobe North), Ahmed Rufai Sani (APC Zamfara West) etc, supported the document. The Senate President, Bukola Saraki in his own remarks agreed that the document was full of unrealistic assumptions and hence urged the senators to allow the Senate give it a second look at committee level to which they were committed. He said: “There is no doubt about the fact that these projections are not realistic.

The Central Bank of Nigeria has said it is using N305 (to a dollar). There is no doubt as well that throughout this year, we did not achieve 2.2 million barrels per day; even in time of peace (in the oil rich Niger Delta), we have not achieved 2.5mbpd. How realistic is 2.2m bpd next year? The oil price as well looks conservative. “Like some of our distinguished colleagues said, our responsibility is to work on it and use our capacity to do the right thing. We have our Committees on Appropriation and Finance that should not just take anything from the executive, sign it and return it (verbatim).

If it means that we have to rehash it, look at it again, turn it around and do what is right, then, that it our responsibility. “I think that it just the way to go rather than to just take adocument from the executive and return the same to it. It is clear from what was submitted (by the lawmakers) today that it will not work like that this time around.” Saraki also asked the Committees on Finance and Appropriation to take note of all said by the senators on the MTEF and FSP during the plenary while preparing their report on the MTEF and FSP, adding that the committees to organise a debate on the performance of the 2016 budget “before we even take the report of the committees on the MTEF, that must be a precondition.”