Following the declining price of crude oil in the international market, the Federal Government has advised governors of the 36 states to look inwards to generate revenues they would need to meet their obligations to workers, contractors, other creditors and provide social services to the people.
In addition to improving on their internally generated revenue, IGR, the Federal Government called on state governments to block waste and be prudent in the management of their resources.
The Minister of Budget and National Planning, Senator Udoma Udo Udoma gave this advice yesterday at the State House in Abuja at the end of the National Economic Council, NEC, meeting presided over by the Vice-President, Prof. Yemi Osinbajo.
He was joined at the briefing by the Governors of Sokoto State, Aminu Tambuwal; Benue State, Samuel Ortom and Taraba State, Darius Ishyaku.
According to Udoma, “I made a presentation to the council on the Medium Term Expenditure Framework (MTEF) and the Fiscal Strategic Paper (FSP).
“The report highlighted the government’s fiscal policy strategy and direction for the next three years.
“We also briefed council about government revenue and expenditure projections for the next three years. We briefed council on our view in terms of the global outlook and macroeconomic framework and the key assumptions underlining our projections.
“The presentation urged the states to adopt the MTEF and FSP which has now been approved by the National Assembly, which is the only body that can approve it.
“But we urged them to adopt it as a basis for the development of their annual budgets. We also emphasised the need for states to be guided by the assumptions of the MTEF and the need for states to be conservative in their expenditure and their expenditure projections for 2016-2018, in view of declining oil prices.
“We also urged states to look towards enhancing their internally generated revenues and blocking financial leakages in the system and generally we emphasised the need for planning and for the federal and state governments to work very closely because we are dealing with one economy.”
Governor Ishaku, while speaking, disclosed that the council was briefed by the Accountant General of the Federation, Mr Ahmed Idris, on the Excess Crude Account, ECA, who , according to him, said: “The Accountant General of the Federation reported to council that the Excess Crude Account (ECA) stood at $2.257 billion at the end of November 2015.
“He also reported a slight change over the previous balance owing to the accrued interest of $599,137,467 due to the account.
“We were also briefed on the report of the federal government agencies that collect revenue in foreign currencies but remit the monies in naira into the Federation Account, which is not allowed.
“So the Ministry of Finance is working on the details to pass it to the council with a comprehensive report on the agencies that are involved. This will be made known to the public later,” the Taraba Governor stated.
On his part, Ortom said the council was given updates on recoveries from monies stolen by the late military head of state, General Sani Abacha, popularly known as the Abacha loot.
“We were also briefed on updates on the Abacha loot in council. The Accountant General of the Federation reported that the dollar account as at November ending 2015 had a balance of $26,389,000 while the pounds sterling account had a balance of £19,000,033,” he disclosed.
According to their Sokoto counterpart, the Governor of the Central Bank of Nigeria, CBN, Mr. Godwin Emefiele, briefed the council on the central bank’s monetary policies.
He added that “The CBN governor gave an update on foreign exchange management and told the council the challenges being faced by many countries as a result of the global economic slowdown.
“He also reported that the drop in oil prices had caused serious pressure on Nigeria’s reserve which currently stands at $29 billion.
“He also briefed the council on other monetary policies as follows: The reduction of the cash reserve ratio from 25 per cent to 20 per cent; the measures introduced in the forex market and bank verification numbers, BVN; a measure being considered to introduce debit cards for travelers instead of giving them dollar cash in order to reduce the cash that is used for illicit businesses; and also looking at options to diversify the economy,” Tambuwal stated.
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