On Wednesday 29th of November, President Bola Tinubu presented the 2024 appropriation bill to the National Assembly, branding it the ‘Budget of Renewed Hope.’
The Federal Executive Council had earlier approved a sum of N27.5 trillion for the 2024 budget on Monday. The government aims for a revenue generation of N18.32 trillion to cover the budget, resulting in a projected deficit of N9.18 trillion.
President Tinubu also predicted an impressive 3.76% economic growth for the 2024 fiscal year. The bill allocates N9.92 trillion for recurrent expenditure and N8.7 trillion for capital expenditure.
President Tinubu, in his address to the National Assembly regarding the 2024 budget proposal, outlined intentions for a thorough revamp of the internal security architecture. The goal is to enhance law enforcement capabilities, ensuring the safeguarding of lives, property, and investments nationwide.
Additionally, the proposed budget underscores a substantial focus on human capital development, particularly emphasizing the well-being and education of school children.
Moreover, the President declared a conservative oil price benchmark of $77.96 per barrel, along with a daily production estimate of 1.78 million barrels per day, based on a comprehensive analysis of global oil market trends. Furthermore, a Naira to U.S. Dollar exchange rate of N750 has been embraced for the year 2024.
Providing a detailed breakdown of the 2024 Appropriation Bill, the President stated: “Accordingly, an aggregate expenditure of 27.5 trillion Naira is proposed for the Federal Government in 2024, of which the non-debt recurrent expenditure is 9.92 trillion Naira while debt service is projected to be 8.25 trillion Naira and capital expenditure is 8.7 trillion Naira. Nigeria remains committed to meeting its debt obligations. Projected debt service is 45% of the expected total revenue.
“The budget deficit is projected at 9.18 trillion Naira in 2024 or 3.88 percent of GDP. This is lower than the 13.78 trillion-Naira deficit recorded in 2023, which represented 6.11 percent of GDP. The deficit will be financed by new borrowings totalling 7.83 trillion Naira, 298.49 billion Naira from privatization proceeds, and 1.05 trillion Naira drawn down on multilateral and bilateral loans secured for specific development projects.”
Having listened to President Tinubu’s Budget Proposal speech, I commend his courage, especially in omitting fuel subsidy allocation, boosting capital allocation by at least 25%.
However, pegging the oil price at $77.96 seems less conservative given the current $80 rate; $65 would have been more prudent. Anticipating an exchange rate of ₦750 to $1 appears achievable, with the Central Bank of Nigeria addressing the forex backlog.
The January start for the Student Loan Scheme and the framework for consumer price regulation bring hope. Yet, the speech lacked details on reducing the Federal Government’s overhead, crucial amidst economic challenges. Maintaining our National Assembly is costly, and while their vital role is appreciated, current economic realities demand prudent measures for Nigeria. While the President may not compel the Legislature to cut its budget, leading by example with a Presidential budget cut could set a precedent, while recommending similar actions for the Legislature.
I fervently hope and earnestly pray that the budgetary decisions will yield tangible benefits for the impoverished masses. The anticipation is rooted in the belief that this fiscal plan can serve as a catalyst for positive change, addressing the pressing needs and challenges faced by those who are economically disadvantaged. In expressing this hope, it is crucial to acknowledge the scepticism that exists, as leaders at various levels are often perceived as unreliable or inconsistent — akin to broken reeds that may not provide the sturdy support needed for lasting improvements.
Despite these reservations, the collective aspiration remains for the budget to stand as a beacon of transformation, uplifting the lives of the marginalized and fostering a more equitable and just society.
Independent insight by Ojo Faruk for IbadanCity ANNOUNCER
