The Federal Government, yesterday, said it had achieved 30 per cent milestone in the implementation of the capital component of the 2020 budget which was rolled over into the 2021 fiscal year.
This is coming as the government described the recent exit from recession as coming earlier than anticipated and attributed it to targeted fiscal stimulus interventions.
Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, who disclosed this at an interface with the leadership of the two chambers of the National Assembly, said the feat was attained at the end of last month.
Ahmed said that though the government achieved 89 per cent in the implementation of the 2020 capital budget as at December last year, the implementation of the remaining capital projects was extended to March 31, 2021 to enable the executive deliver as many of the projects as possible before commencing the full implementation of the 2021 budget.
As at the end of 2020, Ahmed said, the sum of N1.74 trillion, which is about 89 per cent of provision for capital expenditure, had been released to Ministries Departments and Agencies (MDAs) to facilitate budget implementation.
She said that out of this amount, about N118.37 billion was released for COVID- 19 capital expenditure. She recalled that part of the reason for extending the budget life span was to make up for the hiccups experienced in the economy last year.
“The Nigeria economy faced serious challenges in 2020, with the macroeconomic environment significantly disrupted by the COVID-19 pandemic. Crude oil prices declined sharply in the world market, with Bonny Light crude oil price dropping from a peak of $72.2 per barrel on January 7, 2020 to below $20 per barrel in April 2020.
“Another key development in the international crude oil market is the massive output cut by OPEC and its allies to stabilise the world oil market, with Nigeria contributing about 300,000bpd of production cuts.
This necessitated the revision of the 2020 Budget to both account for the lower oil price and the need to make provision for COVID- 19 related expenditures.
“In effect, the economy slipped into recession in Q3 2020 when it recorded a -3.62 per cent negative growth after a -6.10 per cent growth in Q2 2020. However, with the significant and targeted fiscal stimulus as well as other interventions from the monetary authorities, a mild recovery was recorded in Q4 2020 with a 0.11 per cent real GDP growth.
This exit from recession is coming much earlier than we had anticipated,” she said. The minister expressed optimism about the full implementation of the rollover capital budget before the March 31 deadline, but said that will depend on availability of funds, a function of procurement and the capacity of the MDAs to undertake the task.
She said that since virtually all the funds for the projects have been released and most of the agencies have accessed them, a remarkable level of implementation would be achieved before March 31, the deadline of the extension.
President of the Senate, Ahmad Lawan had, at the beginning of the interactive session, told the minister that the essence of the meeting was for the parliament to be briefed on level of implementation of the extended budget before the expiration of its life span.
Lawan commended the executive arm for the high level of performance on the 2020 budget and attributed it to early passage of the budget, speedy presidential assent and hard work by the implementing agencies. In his remarks,
Speaker of the House of Representing tatives, Rt. Hon. Femi Gbajabiamila said since it was not a usual thing to extend the lifespan of a budget, there was need for them to be shown visible and identifiable results which the executive has achieved with the extension granted in respect of the capital component of the 2020 budget.
“This special session of the leadership of NASS interfacing with you is meant for oversighting the extension because feelers from the various MDAs on the implementation are not all that cheery.
“Many of them have complained to our various committees the difficulties being faced in accessing funds said to have been released by your ministry. We want to know the level of performance achieved so far whether it justifies the extension granted or not,” he said.
In his remarks, the Senate’s Chief Whip, Dr. Orji Uzor Kalu (APC Abia) commended the minister on capital performance of the 2020 budget. “I want to commend the minister and her team because this is the first time in the history of Nigeria that by December 31, we are having 89 per cent performance expenditure of the budget.
“It has never happened before. Last year was the very first. The budget had been going 49 per cent, 27 per cent, this means from what the Senate President was asking, it means by March, we should be looking at implementing the budget 100 per cent,” he said.