Atiku Abubakar, a former Nigerian vice president has faulted the 2021 appropriation bill presented by President Muhammadu Buhari on Thursday before a joint session of the National Assembly.
Abubakar said the bill clearly contravenes the Fiscal Responsibility Act.
The president proposed N13.08 trillion expenditure for 2021. Buhari announced that total federally distributable revenue is estimated at N8.433 trillion in 2021 while the total revenue available to fund the 2021 Federal Budget is estimated at N7.886 trillion. This includes Grants and Aid of N354.85 billion as well as the revenues of 60 Government-Owned Enterprises.
The N5.21 trillion deficit in the 2021 budget, representing 3.64 per cent, is to be financed with new borrowings amounting to N4.28 trillion.
While reacting to the deficit, Abubakakar said “the budget deficit in the proposal is N5.21 trillion. This amount is just over 3.5% of Nigeria’s 2019 GDP,” Abubakar tweeted.
“This is contrary to the Fiscal Responsibility Act of 2007, which provides in Part II, Section 12, subsection 1 that: “Aggregate Expenditure and the Aggregate amount appropriated by the National Assembly for each financial year shall not be more than the estimated aggregate revenue plus a deficit, not exceeding three per cent of the estimated Gross Domestic Product or any sustainable percentage as may be determined by the National Assembly for each financial year,” Atiku said.
Atiku said that Nigeria had a GDP of approximately $447 billion in 2019 and that three per cent (3%) of this amount is $13. 3 billion, which at the current official exchange rate of N379 to $1, gives you a figure of N5.07 trillion.
“Even more disturbing is the fact that our GDP has fallen sharply from its 2019 figures, and has been projected by the World Bank and other multilateral institutions at somewhere between $400 billion and $350 billion. Meaning that in actual sense, the N5.21 trillion budget deficit is actually far above the 3% threshold stipulated by the FRA,” Atiku said.
Abubakar, therefore, urged Buhari to withdraw the 2021 budget proposal and should be revised for contravening provisions of the Fiscal Responsibility Act, 2007.