Nigeria to inject N350 billion to stimulate troubled economy — Minister
The Nigerian government says it will inject
N350 billion to stimulate its economy, which
is facing a severe crisis occasioned by falling
oil prices.
Nigeria’s economic growth in the last quarter
stood at 2.1 percent. The total growth
recorded in 2015 was 2.8 percent, the slowest
since 1999, according to data released by the
National Bureau of Statistics, NBS.
Briefing journalists at the end of a two-day
National Economic Council (NEC) retreat at
the conference hall of the Presidential Villa,
the minister of Finance, Kemi Adeosun, said
the N350 billion would be spent mostly on
capital projects and job creation.
“From the Federal Ministry of Finance in
anticipation of the approval of the budget, we
have virtually lined up about N350billion
which we would be pumping into the
Nigerian economy in the forthcoming
months.
“We explained our rationale and the
processes that we have put in place,
safeguards to ensure that this money actually
achieve the desired objective, which is to
stimulate the economy.
“We are already discussing with some of the
contractors who will be paid these monies
and the objectives from the overall criteria is
how many Nigerians would be re-engaged.
“We are specifically looking at contractors
who have laid off staff and how many
Nigerians are you going to put back to work
as a result of this money that we are planning
to release.
“We believe this would bring significant
economic activity,” she said.
Ms. Adeosun said the retreat, which was the
first by the present administration, deliberated
extensively on the drop in revenue,
particularly as to how it affects the state
government and their ability to pay salaries
and fulfil other obligations.
According to her, the general resolve of the
council was that there was a need to bring in
more cost efficiency in the operations of
government, specifically the setting up an efficiency unit
within the state governments, to rationalize expenditure and
to increase IGR.
She said there was a need to generate data because data is
the basis of any revenue collecting efforts, just as there was
a need to develop incentives for both federal and state
revenue generating agencies to ensure alignment of interest
between the two arms of government.
The governors, Ms. Adeosun said, were tasked to focus on
property and consumption taxes in their states to help
improve their revenue in a fair manner.
“Tax payer education must be intensified and to expand the
tax base and ensure that there is a buy-in in the revenue
collection agencies from the populace” she said.
State governors were also encouraged to, where possible,
rationalize the number of commissioners and general
political appointees as well as adopt cost control measures to
be able to sustain their states.
NEC also discussed the need to review the counterpart
funding needed to access the Universal Basic Education
Commission (UBEC) fund from 50 percent to 10 percent.
The states currently need to have a counterpart fund of 50
percent to access the UBEC grants,
Upon review, it would become 10 and 90 percent
contribution.
According to the minister, this will release an estimated “58
billion naira that is currently un-accessed”.
The minister said the council discussed that with N53billion,
Nigeria could revamp at least 1,000 of the worst classrooms
in each of the 36 states.
She said the council also discussed getting a “legislative
approval to change the need for counterpart funding on the
part of state governments”.
N350 billion to stimulate its economy, which
is facing a severe crisis occasioned by falling
oil prices.
Nigeria’s economic growth in the last quarter
stood at 2.1 percent. The total growth
recorded in 2015 was 2.8 percent, the slowest
since 1999, according to data released by the
National Bureau of Statistics, NBS.
Briefing journalists at the end of a two-day
National Economic Council (NEC) retreat at
the conference hall of the Presidential Villa,
the minister of Finance, Kemi Adeosun, said
the N350 billion would be spent mostly on
capital projects and job creation.
“From the Federal Ministry of Finance in
anticipation of the approval of the budget, we
have virtually lined up about N350billion
which we would be pumping into the
Nigerian economy in the forthcoming
months.
“We explained our rationale and the
processes that we have put in place,
safeguards to ensure that this money actually
achieve the desired objective, which is to
stimulate the economy.
“We are already discussing with some of the
contractors who will be paid these monies
and the objectives from the overall criteria is
how many Nigerians would be re-engaged.
“We are specifically looking at contractors
who have laid off staff and how many
Nigerians are you going to put back to work
as a result of this money that we are planning
to release.
“We believe this would bring significant
economic activity,” she said.
Ms. Adeosun said the retreat, which was the
first by the present administration, deliberated
extensively on the drop in revenue,
particularly as to how it affects the state
government and their ability to pay salaries
and fulfil other obligations.
According to her, the general resolve of the
council was that there was a need to bring in
more cost efficiency in the operations of
government, specifically the setting up an efficiency unit
within the state governments, to rationalize expenditure and
to increase IGR.
She said there was a need to generate data because data is
the basis of any revenue collecting efforts, just as there was
a need to develop incentives for both federal and state
revenue generating agencies to ensure alignment of interest
between the two arms of government.
The governors, Ms. Adeosun said, were tasked to focus on
property and consumption taxes in their states to help
improve their revenue in a fair manner.
“Tax payer education must be intensified and to expand the
tax base and ensure that there is a buy-in in the revenue
collection agencies from the populace” she said.
State governors were also encouraged to, where possible,
rationalize the number of commissioners and general
political appointees as well as adopt cost control measures to
be able to sustain their states.
NEC also discussed the need to review the counterpart
funding needed to access the Universal Basic Education
Commission (UBEC) fund from 50 percent to 10 percent.
The states currently need to have a counterpart fund of 50
percent to access the UBEC grants,
Upon review, it would become 10 and 90 percent
contribution.
According to the minister, this will release an estimated “58
billion naira that is currently un-accessed”.
The minister said the council discussed that with N53billion,
Nigeria could revamp at least 1,000 of the worst classrooms
in each of the 36 states.
She said the council also discussed getting a “legislative
approval to change the need for counterpart funding on the
part of state governments”.
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