The Chairman, Fiscal Responsibility Commission (FRC), Mr Victor Muruako, says the Federal Government is still within the legal framework of fiscal borrowings and budget deficit threshold.
He said this on Friday, in Abuja at the signing of a Memorandum of Understanding (MoU) with the Nigerian Institute of Quantity Surveyors (NIQS).
Muruako said that the Fiscal Responsibility Act (FRA) 2007, gave room for exceptions when there was need for it and that the 2022 Appropriation Bill was still within the three per cent fiscal borrowing threshold.
“The FRA clearly defines what the borrowing threshold should be, but it also makes room for exceptions.”
“The government and the parliament have taken the bold step to amend the FRA through the Finance Act 2020 and the Finance Act is reviewed annually and as the budget is coming the National Assembly will also take a look at the Finance Act.”
“The government is still acting within the legal framework of it and for every law there must be an exception.”
“While we continue to push to ensure that the deficit level does not exceed what it should be, we should also appreciate some of the obvious challenges that the government has found itself like COVID-19 which almost crippled the world economy.”
Our correspondent reports that President Muhammadu Buhari presented the N16.39 trillion 2022 Appropriation Bill to a joint session of the National Assembly on Oct. 7, in Abuja.
According to Buhari, total revenue available to fund the 2022 Federal Budget is estimated at N10.13 trillion, including grants and aid of N63.38 billion, as well as the revenues of 63 Government-Owned Enterprises (GOEs).
Of the N16.39 trillion proposed to be spent in 2022, N10.132 trillion was projected to be generated as revenue and N6.26 trillion, being 3.39 per cent of GDP as deficit would be financed majorly by borrowings.
To fund the deficit, N2.51 trillion would come from domestic sources, another N2.51 trillion from foreign borrowings, N1.16 trillion from multi- and bi-lateral loan drawdowns and N90.7 billion from privatization proceeds.
Speaking on the MoU with NIQS, Muruako said that it would help in the evaluation of capital projects as having seasoned professionals on the commission’s team would enhance the quality of its verification of Federal Government projects.
Muruako also said that the FRC was organising a two-day sensitisation workshop on Transparency, Accountability and Prudence (TAP) in the North-West and South-West geo-political zones of the country.
Themed “Fiscal Transparency and Sustainable Development at the Sub-Nationals”, it is part of a series of zonal sensitisation campaigns on TAP in public finance management.
“The core objectives of the events is to expand and deepen the frontiers of fiscal responsibility, transparencty and accountability to the sub-national levels of government in Nigeria.”
“The target is to reach government and citizens at all levels, down to the grassroots to enthrone a culture of fiscal responsibility, transparent and prudence and thereby advance the macro-economic stability and sustainability of our dear nation.”
The workshops are scheduled to hold in Kano for the North-West on Oct. 25 and 26 and in Lagos for the South-West on Nov. 1 and 2.
The president of NIQS, Mr Mohammed Abba-Tor, said that NIQS members across the country were willing to support the efforts of the commission in having the FRA amended, while also giving technical support in the fight against corruption.
He said that the impact of the MoU on the commission were the values quantity surveyors lived by which include transparency, value for money and accountability.
“So, we are going to make ourselves available in areas of managing and evaluation monitoring, evaluation of projects, looking at post contract auditing and so on.”
“We have templates and frameworks for evaluating whether the process has been diligently followed or not, if they are not followed, there should be some repercussions for those defaulting government agencies.”
“In addition to the monetary evaluation is post contract audit, we are also going to make available a kind of technical advice and support in various sectors as we keep on monitoring and partnering with this very important commission.”
Abba-Tor said that the collaboration between the public sector and private sector, demonstrated by the institute’s willingness to partner with FRC was first of its kind and very important for national support.
He added that the private sector was supporting the efforts of the Federal Governments in ensuring value for money as so much money should not be spent on getting so little in terms of project delivery.
According to him, there must be a match between the concept, plan and then the actual achievement of goals.
Our correspondent reports that the FRA which came into existence in 2007, is an Act that provides for prudent management of the nation’s resources and ensure long-term macro-economic stability of the national economy.
It also seeks to secure greater accountability and transparency in fiscal operations within a medium-term fiscal policy framework.