FG releases N350bn to revamp economy

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…sets up monitoring committees

The Federal Government, in the next few months, will inject a total of N350 billion to revamp the Nigerian economy. The decision was taken at the end of a two-day retreat for governors of the 36 states of the federation and members of the National Economic Council (NEC) at the presidential villa, Abuja.

Nigerian economy, which has been heavily hit by dwindling crude oil prices at the international market, has adversely affected livelihood of most citizens. Government has been struggling with options on how to navigate through for a rebound. Briefing state house correspondents at the end of the retreat, Minister of Finance, Mrs. Kemi Adeosun, who was joined by the Minister of Budget and National Planning, Udoma Udo Udoma, Governors Abdul’aziz Yari (Zamfara) and Willie Obiano (Anambra) said part of the funds will assist in payment of local contractors who had laid off staff for lack of funds to operate. Federal Government had recently disclosed that following the successful implementation of the Treasury Single Account (TSA), it had saved over N2.5 trillion in a special account at the Central Bank of Nigeria (CBN).

The minister explained that the retreat was concerned about the state of the economy and deliberated extensively on the drop in revenue, particularly as to how it affects the state governments and their ability to pay salaries and obligations. Adeosun said: “From the Federal Ministry of Finance in anticipation of the approval of the budget, we have virtually lined up about N350 billion, 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, safe guards to ensure that this money actually achieves the desired objective which is to stimulate the economy.”

The minister noted that the Federal Government was discussing with some contractors who will be paid part of the fund management. With near stagnation of economic activities in the last months, some contractors, who had down tools for non-payment of executed contracts, laid off a number of staff.

“We are already discussing with some of the contractors who will be paid these monies and the objective 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 and we believe that this would bring significant economic activity.”

Adeosun said one of the decisions taken at the meeting was a need to bring in more cost efficiency in the operation of government businesses. Both the Federal Government and the states agreed to set up efficiency units and rationalise expenditure in order to increase Internally Generated Revenue (IGR). The Finance Minister disclosed that to achieve this, all levels of government would generate data, which is the basis of any revenue collecting efforts.

“The Federal and State Inland Revenue Services collaborate to do joint audits to invest in revenue, relevant technology and efforts to improve collection. There is a need to develop incentives for both federal and state revenue generating agencies to ensure that there is an alignment of interest.

“There is a focus at state level on property and consumption taxes to help in improving 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 added. According to the Finance Minister, state governors were encouraged during the retreat aside rationalising numbers of commissioners and general political appointees, to identify other cost control measures. Efforts by the state governments to meet counterpart funding has increased their debt profile.

In his remarks, Yari, who is the chairman of the Nigerian Governors’ Forum, disclosed that the retreat approved the constitution of two committees, which include the monitoring and implementation committee, as well as a steering committee headed by Vice- President Yemi Osinbajo to work in ensuring that all agreements reached between the state and federal governments at the meeting are implemented.

Also speaking, Udoma explained that going forward, both states and the federal government have agreed to collaborate to diversify the economy and revamp agriculture. He said the target is to achieve self-sufficiency in identified crops, which should be monitored. Tomato paste – 2016, Rice – 2018, Wheat – 2019.

Other targets set between the federal and state governments, according to him, are to roll out agricultural extension services nationwide, for the commodity exchanges to be established for price regulation and avoidance of losses due to lack of markets and the revitalisation of the Abuja Commodity Exchange.

source: http://newtelegraphonline.com/fg-releases-n350bn-revamp-economy/

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