The Minister of Budget and National Planning, Sen. Udoma Udo Udoma, has emphasised the need for the country to increase its revenue generation.
Udoma made the call during the Public Consultation on the 2019-2021 Medium Term Fiscal Framework and Strategy Forum on Thursday in Abuja.
He said it was important for the country to substantially concentrate at increasing its oil and non-oil revenues as well as reduce borrowing.
“We must look at ways of squeezing out the maximum we can get from oil because oil is a wasting asset, we need to get the money and use it to solve a lot of our problems.
“We need to invest in infrastructure, invest in human capacity development and in all we need to build up our stock of capital.
“We also need to ensure we build up the non-oil sector.
“At the moment, the revenues are on average up by about 30 per cent from 2017, but it is not where we want to be, we need to do much better,’’ Udoma said.
The minister also harped on the need for the country to ensure it increased its revenue through tax collection.
“Our ratio of taxes collected to our Gross Domestic Product (GDP) is still very low.
“We need to look at how we can generate resources so that we rely less on debts, more on revenue and also build up the revenue so our debt service to revenue ratio will bring that down.
“We must increase our revenues that have to be the priority, because when you have that revenue, it is possible to deliver quality infrastructure which this country requires’’.
According to Udoma, the medium term framework outlined the Federal Government’s strategies and macro-economic projections for 2019-2021, which is built on the Economic Recovery and Growth Plan (ERGP).
He said it provided the broad framework for the annual budget in line with the Fiscal Responsibility Act.
Udoma said the framework was aimed at sustaining growth, diversifying the productive base of the economy as well as reflect the priorities and objectives of the ERGP.
The minister expressed optimism that the country would continue to experience growth with the continued implementation of the ERGP, as well as the improved outlook for oil prices.
In terms of oil production volume, the minister said it was projected at 2.3 million barrels per day for 2019, with an exchange rate of N305.
He said the GDP growth rate for 2019 was projected at three per cent, 3.6 per cent for 2020 and 3.9 per cent for 2021.
On the overall revenue framework, he said given the assumptions, we expect to generate about 3.6 trillion share of oil revenue up of about 500 billion.
On expenditure, Udoma said the framework had projected a reduced budget.
“Rather than looking at 9.1 trillion in 2018, we are looking at 8.6 trillion budget in 2019, so we are bringing down the size of the budget.
“Part of the reason is that we also want to reduce the level of borrowing, we want to reduce the deficit, so we are coming down in terms of the budget size.
“However, there are certain things which we decided is important that even with a smaller budget must be addressed.
“Many of them have to deal with human capacity, human development, health, education and pension.
“We are not going to compromise in terms of our responsibility of the state to the Nigerian people.’’
On the overview of the deficit financing and critical ratios, the minister said the deficit would be reduced from 1.9 trillion in 2018 to 1.6trillion in 2019.
“We are reducing the new borrowings from 1.6 trillion to 1.5 trillion, so basically what we are doing is to reduce the size of the budget,’’ Udoma said.