The Senate on Tuesday passed the 2020 revised budget of N10.509 trillion into second reading after exhaustive debate.
The Revised budget was submitted to National Assembly last week for consideration.
Leading debate on the budget, Senate Leader, Senator Abdullahi Yahaya, explained that the revised of 2020 Budget was necessitated as a result of the outbreak of Coronavirus Disease, which affected the economy.
According to him, following the outbreak of the COVID-19) and its rapid spin into a global pandemic in Q1 2020, there has been corresponding economic consequences.
Yahaya said: There has been a slow down of global economic activities as most countries are on lockdown with movement only limited to essential goods or persons performing essential services.
“Correspondingly, international oil prices have plunged, triggered by the Saudi-Russia Oil War and weakening global demand.
“Further to the above, most of the assumptions underpinning the 2020 FGN Budget have had to be revised in the face of current realities, as Nigeria is vulnerable to the current global economic disruption caused by the COVID-19 crisis which has led to decline in crude oil prices and spikes in risk aversion in the global capital markets.
“Prior to the outbreak of COVID-19 pandemic, the Nigerian economy had been characterised by wavering external sector and improving internal economic indicators.
“Overdependence on oil revenue, constrained fiscal space, low foreign and domestic investments and declining foreign reserves made the economy disproportionately vulnerable to the twin shocks of crude oil price/production collapse and a health crisis affecting negatively the informal sector which accounts for over half of the Nigeria’s GDP.”
Yahaya said the revised budget sought to authorise the issue out of the Consolidated Revenue Fund of the Federation, with a total sum of N10.509 trillion, of which N398.5 billion is for Statutory Transfers, N2.9 trillion is for Debt Servicing, N4.9 trillion for Recurrent (Non-Debt Expenditure), while the sum of N2.230 trillion is for contribution to the development fund for Capital Expenditure for the year ending December 31, 2020 as against the earlier passed Appropriation Act in the sum of N10. 594 trillion .
He told the lawmakers that as a result of decline in crude oil price, Nigeria’s foreign reserves declined to $35.9 billion in March 2020.
The Senate Leader said: “The aggregate revenue available to fund the 2020 budget is now projected at N5.09 trillion (35 per cent or N2.78 trillion less than 2020 Budget passed by National Assembly).
“Twenty-six per cent of this projected to come from oil related sources, while the balance is to be earned from non-oil sources.
“The provision of Stamp Duty was reduced to N200 billion from N463.95 billion, while Signature Bonus is down to N350.52 billion from N939.30 billion.
“With the retained revenues of the 10 major Government-Owned Enterprises, the aggregate FGN revenue is projected at N5.56 trillion.
“In order to forestall, or at least slow down, a decline into another recession, the Federal Government did not set out to implement an austerity-style cuts in expenditure.
“However, in a bid to reprioritise government spending, some nonessential and deferrable expenditure (especially those classified as Administrative Capital Expenditure) were reduced in favour of growth enhancing, pro-poor funding expenditures and social sector investments in order to combat the current pandemic as well as its negative impacts on the economy.”
Speaking on the revised budget, Senator James Manager said he doubts if anyone would oppose the amendment of the 2020 budget.
Senator Opeyemi Bamidele supported the revised budget, saying he is impressed with the adjustment, which didn’t affect the health sector because of the COVID-19 pandemic.
Bamidele also praised the attention given to the agriculture sector.
He however expressed dissatisfaction with the allocation to Judiciary, which is less than 1 per cent of the revised budget.
In his contribution, Senator Smart Adeyemi implored the Federal Government to look into a way of developing agriculture, especially the cash crops, in order to boost the nation’s foreign earnings.
After exhaustive debate on the budget, the Senate passed the budget into second reading and referred the budget to Senate Committee on Appropriation for further legislation.
The committee is expected to report back next week Tuesday.