Nigeria News

Yuguda: Economy Working Despite Fiscal Challenges

Notwithstanding the current fiscal challenge occasioned by the tumbling oil prices, the Nigerian economy remains functional and working, according to Minister of State for Finance, Alhaji Bashir Yuguda.

He said but for the various measures already put in place by the federal government, monthly revenue receipts particularly  for December would have been nothing to write home about.

The falling price of oil has had a negative impact on the December collections as gross receipts slumped further to N490.03 billion compared to N500.07 billion the previous month while a total distributable revenue amounting to N580.37 billion was also shared among the three tiers of government compared to N628.77 billion shared in November.

But Yuguda argued that if the economy and other measures to boost non-oil revenue were not working, revenue for the month would have been halved.
Speaking over the weekend after the monthly meeting of the Federation Accounts Allocation Committee (FAAC), he urged the states to also tighten up and prioritise their spending as well as cut down on their recurrent expenditure and concentrate on finishing and prioritising their projects.

The minister’s comment came as Chairman, Forum of Finance Commissioners, Mr. Timothy Odah, said the emerging fiscal challenge could in the long run necessitate a national wage review and an attempt to avoid job cuts.

Nevertheless, Yuguda said: “What we try to do at the federal government level is that if you noticed in the last two FAAC meetings we had, before we commenced the actual deliberations at the plenary session to key in with us at the federal government and see the kind of measures we are taking to mitigate against this but the economy is working; if we were only now relying on the price of crude oil, the figures I have given you today at FAAC would have been halved because price of oil was going for over $100 but now at a little above $40.”

He said: “So if we are only relying on the prices of oil to sustain ourselves as a nation, things would have been different. That’s part of the measures this administration has been putting in place in order to expand the economy to make it expert-oriented especially in the area of agriculture, solid minerals and in the area of services. And these have come out clearly when we Rebased our GDP.”

Continuing, the minister said: “So my advise to the states is also to tighten up and let them prioritise their spending; let them reduce the expenditure side of recurrent and concentrate on finishing and prioritising their projects. As for states, definitely it cannot be easy just like for us at the federal government but this is a challenging period, the measures we’ve put in place we believe would work and hopefully by the time we get the National Assembly to approve our budget things would take a clearer picture in the country.

“We are aggressively looking into the areas of tax and non-oil revenues accruing to the federal government.

We have effectively given figures which must be attained by FIRS-that’s one measure. We gave them a figure of N75 billion and as I talk to you, they are able to surpass that figure before December ending. That is working. Secondly, we are also looking at luxury tax, me are looking at property tax as well as blocking loopholes that obviously can drain the purse of government.”

Meanwhile, defending the likely preference of government for wage review rather than job cuts, Odah told THISDAY: “In the areas of having many personal assistants among others, I will not suggest that they should be cut down because it is part of employment. The only thing is that the remuneration should be reviewed because if a state governor has a hundred special advisers, they are all employed and it reduces the rate of vices in the society. So the salaries or remuneration should be reviewed.

He said: “And of course, what is happening now is that it is possible that it may eventually lead to a national wage review if we are in a pragmatic governance. It is better to have many employed and they are taking something little than you having many unemployed and you are paying a few higher salaries.

Two, our level of consumption, this is a time when we have to patronise locally made products including chicken, rice among others.”

“This is a time we should look at low level projects that will be of use to many rather than high level projects that would be of benefit to those in the high echelon,” he added.

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