No Decision Yet on When 2016 Budget Will be Signed – FG

The federal government has said that talks to reach a truce between it and the National Assembly on grey areas in the 2016 budget were still ongoing, adding that it could not give any definite date as to when the budget would be signed into law.

The implication of the government’s statement is that the hopes of many Nigerians who were expecting that the 2016 budget would be signed into law anytime soon has been dashed.

This was one of the outcomes of the Federal Executive Council (FEC) meeting which held at the Presidential Villa in Abuja wednesday and presided over by President Muhammadu Buhari,

Despite the absence of clarity on the fate of this year’s budget, the government set out the timetable for the submission of the 2017 budget, explaining that this was done to ensure early delivery of next year’s expenditure estimates.

Briefing State House correspondents at the end of the meeting, the Minister of Budget and National Planning, Mr. Udoma Udo Udoma, who was accompanied by his colleagues in the Ministries of Petroleum Resources, Dr. Ibe Kachikwu; Power, Housing and Works, Babatunde Fashola; and Communications, Adebayo Shittu, said that ahead of the eventual signing of the 2016 budget, the federal government had set up a monitoring and evaluation mechanism to ensure that the budget is implemented.

Udoma also dismissed speculations that the budget was returned to the National Assembly to be reworked.

He said: “On the expectation that we will soon have a budget, the monitoring and evaluation mechanism to make sure that the budget delivers what it promises. That mechanism was looked at by the Federal Executive Council and approved.

“To make sure that 2017 budget is done on time, a timetable was approved for the 2017 budget.
“In addition, council noted the report of the Nigerian Economic Summit Group (NESG), which in partnership with National Planning Commission organised an economic summit last year and made various recommendations; these recommendations were presented and noted.”

Also, speaking on the lingering fuel shortages in the country, the Minister of State for Petroleum said that queues were expected to completely disappear by the end of next week.
He blamed the unhealthy development on sabotage, but did not name the saboteurs. He however thanked Nigerians for their patience so far.

“The queues are as a result of sabotage. Some people, rather than sell products, send them to the hinterlands where they can sell at ridiculous prices and so you are having this price distortions where people are making a lot of money.

“Some are internal and others are external but a lot of it is marketers trying to make quick returns on their investments wrongly.

“We have asked DPR (Department of Petroleum Resources) to deploy officials to ensure products are sold at the right price because it is only through price stabilisation that these queues would disappear.

“As at today we are delivering about 1,200 trucks, by the weekend we should be delivering the same number of trucks, but it will take a bit of days to even out. However, you can see the improvement already.

“So I hope that by the end of next week and with the refineries helping us to stay on course, every part of the country will get fuel.

“We thank the president, NNPC staff and ministry officials who worked night and day to enforce discipline.

“We thank Nigerians for their unbelievable level of patience, we are solving the problems we met on ground and trying to find long-term solutions to them and urge Nigerians to report sabotage where people are selling products at higher prices because we all need to work collectively,” he said.

Kachikwu further revealed that he briefed the FEC meeting on the efforts to elimintate fuel queues.
He said: “Our intervention today was to give a brief update on the petroleum distribution position and the whole fuel queues crisis that has been in this country for weeks.

“These are as a result of four factors: the first of course is fiscal; by the time we came on board last year, there was over N600 billion subsidy which was not paid for in 2014 and 2015 and marketers were at a point where they were running out of liquidity.

“They were very challenged to the extent that some had gotten out of business and were not importing.

“We were able to pay that money around November last year with the intervention of the president, National Assembly and other stakeholders.

“But soon after, there were no credit lines and this put pressure on NNPC to provide products at almost 100 per cent because the private sector was not supplying. This has largely been the problem.

“On the logistical side, the refineries were not producing when we came in, meaning we had no reserves. When you don’t have reserves, the hiccups hit you right in the belly because there is nothing to replace with.

“But what we have tried to do in the last one month is to try and flood the market with products, so we are in the position to say that between now and October, we have cargoes in excess of what we actually need. Effectively, we have addressed the supply issue.

“Last week, we had about 11 cargoes in, this week we had about 10 cargoes in. For the month of April collectively we had 38 cargoes. This is the first in the history of this country.

“On the infrastructure aspect, unless we deal with the systemic issues these things would keep coming back. But we are hoping that by July, we will be able to sign agreements that will enable upgrades and for the joint venture of the refineries to take effect.

“We expect that to last for about 12 months, and we expect that by 2017 we should have all the refineries back where they ought to be. The target is that by 2018, we will reduce fuel imports by 60 per cent and by 2019 with our refineries producing at 400,000 barrels per day, we will exceed our refined products requirements and begin to export petroleum products.

“Another thing is that we are targeting by the end of May to create strategic reserves in Lagos, Port Harcourt and Ogara (Delta State) and once we do that, whatever refined products we have from our refineries will go to the depots.

“The goodness is that the refineries as challenging as they can be, they are back on stream – Port Harcourt and Warri have been supplied crude – we are also pumping to Kaduna and so by end of the May they will work.”

The Minister of Power, Works and Housing, in his briefing, spoke on the current power outages and provided clarity on the cause of the frequent outages.

According to him, the damaged Forcados pipeline is principally to blame for the drop in electricity generation.

He however assured Nigerians that the government was working to remedy the situation, just as he stated that the president’s target of 10,000MW by 2019 was achievable.

He said: “Our intervention today was an update to council on the status of power, the causes of the outages that are being experienced, and plans to solve them.

“Essentially the problem is a gas supply issue arising from the problems that have been well reported by the media on the failure of our operational platforms at Forcados where the repairs are ongoing on the gas pipelines.

“It is a Ministry of Petroleum issue, but they are keeping us in the loop about all of this and when the issues will be resolved.

“As a result of this, our power output has dropped from 5,000MW to about 3,000 or 3,200MW, depending on other collateral problems. So what was not enough at 5,000MW, is even now much more difficult to share at 3,000MW.

“But we are having increasing success with some of our transmission projects. So areas in the country that do not have power supply when we were at 5,000MW now have transmission restored.
“Places like the Maiduguri, Okada, Makurdi transmission projects have been completed and residents are now benefiting from what was difficult to share initially.

“We understand that people are going through difficult times, because this is a bad time to have energy crisis and there is no good time to have one. But like we briefed council, this is a temporary thing and we will go back to normal service when gas is fully restored.

“We are working to make sure that should this happen again in future, we would be better prepared to respond by increasing the opportunities for local gas allocation and production from the non-associated gas lines.

“And we are confident that we can meet the target of 10,000MW set by Mr. President by 2019.
“This is a teething problem, it won’t last for long. Our determination to overcome it is bigger than the problem and I’m very sure it will be overcome.”

Shittu, while briefing journalists, stated that the federal government has not entered into formal negotiations with MTN on the N789 billion fine slammed on it for refusing to block 5.2 million unregistered lines as directed by the Nigerian Communications Commission (NCC), the industry regulator.

He also revealed other interventions by his ministry, which were discussed at the FEC meeting.
Also, the Foreign Affairs Minister said that there would be safeguards to protect Nigeria in all the agreements the country signs with China, adding that Nigeria would push for agreements that would insist on much greater local participation.

He said: “If they want to come in and invest in building railway lines, there should be a certain number of Nigerians involved in the project, but I think as a government, we will obviously be looking at that kind of agreement.

“I am sure that the Minister of Labour will have a say in ensuring that any big project we enter into with China will be in the interest of Nigeria, and we are going to get something out of it, not just the infrastructure but also it should provide jobs.”

On currency swap with China, Onyeama assured his audience that the deal would ease pressure on dollar demand and give Nigeria some flexibility.

He said: “In West Africa, they (Chinese) are looking for a hub. Ghana is interested in being the hub for the currency to circulate for those who want to use it.

“But Nigeria is a bigger country and economy. So that it makes sense for China to agree a currency swap with us, and they were attracted to Nigeria because of the prospects of the hub for the sub-region.”

On whether the agreement with China would not bring Nigeria in conflict with Western countries, Onyeama said: “In relationships with the West, don’t forget that what has helped China to grow so fast in the last 30 years is because of the investments of the West in China.

“That is really what has transformed the Chinese economy – the Japanese, Germans and Americans. So we will not have any problem with the West. China is part of the World Trade Organisation (WTO) and part of the international trading system.”
This post originally appeared in ThisDay

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