FG attributes procurement procedure, low revenue to delay in project execution

Minister of Budget Senator Udo Udoma yesterday revealed that the Federal Government cannot fully implement 2016 budget as passed. He stated this when he appeared before the Senate and gave reasons why 2016 budget will not by fully implemented’
According to him ‘’ the first is that because of the procurement procedure, no new project is ripe for any capital releases because of the six months of procurement process including advertising and so on. It is only existing projects which already met the criteria for the various procurement stages are qualified for releases. The second reason for the low capital releases is the low revenue. Overall for the first quarter we were running at about 55 percent in terms of our revenue expectations.
‘’ The bulk of it is because of the problems in the Niger Delta which affected oil production which prevented us from reaching the 2.2 billion barrel even though the price is going up. At a point production went down to one million barrel. Right now, we have been informed by the Minister of Petroleum that it is going up again to about N1.9 billion barrel but that revenue will come in three months time because the generation of today is not the revenue of today but of three months time. Customs and the FIRS have told us that their revenue generation is seasonal. We are hoping that as the year goes along, we will recover some revenue from oil as production increases. We also expect revenue coming from FIRS because people don’t pay taxes in the first quarter. FIRS had already reached 60 percent of the projected revenue as of June this year and we expect it to keep on rising.
‘’There is a revenue meeting going on in Kano hence I won’t be able to give adequate revenue breakdown because we are not with the document here. That is why it is the expenditure figure that we will be able to give you. The Kano meeting was called to review revenue and the revenue situation because we are not achieving revenue targets which we set for the revenue generating agencies.
In personnel releases, the budget was N1, 723, 819, 398, 198 but was we released was N871, 459, 760, 939 which comes to about 50 percent. This is the way it should be because we are already in July and we have done six months which is half of the year.
‘’For overhead, the budget is N218, 368, 364, 886 and we have released N52, 913, 047, 226 (25 percent).
The National Assembly gave us till May next year to carry out the capital expenditure and we still have 10 months of capital spending to do. Nevertheless, out of the capital for MDAs, out of N1, 587, 598, 122, 028, we have released N235, 916, 566, 642 ( 15 percent). There are two reasons for the low level of capital releases,
However, the DG budget, Ben Akabueze: Said ‘’The inability of the country to generate the expected revenue target has to do partly due to difficulties in accessing foreign exchange that affected the import volume and therefore affected customs revenue because the importers and manufacturers cannot import, but now the situation had changed there was improvement in importation since the access to forex had also improved.
Statutory transfer of N175, 681m had been met in full as priority projects of the MDAs were considered’’.

READ ALSO  Boko Haram gives new conditions for Chibok school girls’ release