Economy

2021 budget: FRC urges FG to invest borrowings in infrastructure for economic growth

Published

on

The Fiscal Responsibility Commission (FRC), has urged the Federal Government to utilise the ‘new borrowings’ in the 2021 budget for investment in key infrastructure development to stimulate economic growth.

Mr Victor Muruako, FRC Chairman said this in an interview with News Agency of Nigeria , in Abuja on Thursday.

According to Muruako, the deficit in the budget is slightly above the three per cent threshold set by the FRA.

He, nevertheless, said that the borrowing was a positive action and the FRA Act made provision for exception to the three per cent rule.

“Sub-section 2 of that Section 12 of the same law goes further to state that the fiscal deficit can actually exceed the three per cent ceiling of the Gross Domestic Product (GDP).

“If in the opinion of the president there is a threat to national security or sovereignty of the country, you have to note that there is no law without exception to the rule.

“That Act made provision for exception to the rule; the borrowing will definitely galvanise the economy; it will increase the generation of Internally Generated Revenue (IGR).

“What the government should do is make the borrowing for key infrastructure development which will stimulate the economy for growth,” Muruako said.

He added: “This particular proposal by the president is one of those situations where borrowing is a positive act.

“What is important in this case is to ensure that the funds that will be borrowed are properly utilised.”

The chairman also reiterated that most government enterprises were in default of their obligations to the FRA 2007 and urged all heads of such organisations to endeavour to remit their operating surpluses to the government.

He said that non-remittance by agencies contributed to the delay in the release of funds for the budget.

“We are not talking about funds that are already somewhere. So the failure of some of these enterprises to pay in the operating surpluses over the years is part of the impact.

“The solution is simple; all hands should be on deck. All heads of government-owned agencies should know that we all owe it to our nation to do our best to ensure that we continue to remit what is due to the government.

“There is also need strategically to strengthen the government revenue base and there is need for greater commitment of citizens because government cannot release what they do not have,” he said.

Muruako also urged that the expectations of citizens must be in line with the availability of funds.

NAN reports that President Muhammadu Buhari, on Oct. 8, presented the  N13.08 trillion 2021 budget to a joint session of the National Assembly for consideration.

He explained that the total aggregate revenue projected for the ‘Budget of Economic Recovery and Resilience’ was N7.86 trillion with a deficit of N5.2 trillion.

He said that of the N5.2 trillion, N4.28 trillion will be financed through borrowing; N2.14 trillion from domestic sources and the other N2.14 trillion from foreign sources.

Also, borrowings from multi-lateral and bi-lateral loan draw downs was put at N709.69 billion and privatisation proceeds put at N205.15 billion.

The president said that the country was still faced with the existential challenge of COVID-19 pandemic and its aftermath.

He added that the deficit provided a justification to exceed the threshold as provided for by Fiscal Responsibility Act (FRA) 2007.

Edited By: Ali Baba-Inuwa
Source: NAN

 

Ex-lawmaker urges Ogun, Lagos govts to repair Abeokuta expressway Looters of NYSC camp will be apprehended, prosecuted, says police chief Flood: Bayelsa Govt begins technical study to tackle impact FG vows to discourage physicians’ “brain drain” from the country UN Chief calls for peaceful presidential polls in Ivory Coast Top two seeds Djokovic, Thiem ousted in Vienna Open quarter-finals COVID-19: Expert calls for campaign to help uplift Nigerians’ spirits. Curfew forces Belgium to move home venue for internationals Minister condemns destruction of medical equipment in Kogi Ronaldo recovers from COVID-19 infection England’s “Toothless Tiger” dies at 78 #EndSARS: Gov. Okowa says Nigerians need collective responsibility to rebuild the nation #ENDSARS: FRSC boss orders immediate resumption of operational activities EndSARS: Police say protesters attacked 205 public, private facilities Ekiti APC felicitates with ABUAD Founder, S’East governors, youths call for reduction of security roadblocks in region Makinde’s administration has paid N2.9 bn gratuity – Commissioner CSO calls for effective management, prioritisation of water, sanitation Senator extols virtues of Afe Babalola at 91 Gov. Akeredolu orders 7-day ultimatum for surrender of arms, ammunition in wrong hands President Buhari welcomes international partnership to spur development Navy Sailing Club to stage 3 races in November Feb. 23 fixed for Akeredolu’s inauguration for second term in office Klopp seeking solutions after Van Dijk surgery, Fabinho injury hamper Liverpool defence EndSARS: NGO wants Lagos panel to summon promoters of fake news ECOWAS to strengthen institutions to combat organised crimes United States stocks fall, indices head for weekly losses as virus cases spike UNESCO approves 3 additional biosphere reserves for Nigeria 2 teenagers found dead on Greek island after major quake Delta Schools resume, begin teleclass Nov. 2 – Commissioner Hold public office holders accountable to the people’- Gov. Wike charges NGE Mayhem: How we secured Surulere from hoodlums — Lagos youth leader Africa CDC warns of second wave of COVID-19 infections in Africa LASG flags off Eti-Osa-Lekki-Epe Expressway reconstruction project Sunday UN lauds FG for implementing programmes on women Protest: NASS C/River Caucus sues for peace Reps committee restates commitment to enforcing code of conduct Netherlands reports over 11,000 new infections for first time Coronavirus, social distancing and the Nigerian Women Entrepreneurs NAHCON mourns President of Hajj operators Zambian leader defends investments in road works Water Resources Control Bill: Minister decries misinformation of Nigerians Expert tasks mothers on child-spacing  Police inaugurate committee to assess losses during #EndSARS protest Nigeria stock market gains N571bn in bullish trading ActionAid urges govts to improve investment in agriculture Anambra FA election fail to produce chairman despite sole candidacy IGP commends officers on professionalism during EndSARS protest Lagos Assembly initiates Bill to improve accountability in governance EU executive takes legal action against Hungary for new asylum laws