24 Nov

Daily Watch – NASS kills early budget passage, Power ministry to spend ₦355m on ‘short term studies’

  • A new NBS report shows that the revenue generated from value-added tax in Q3 2017 was ₦250.56 billion, higher than the ₦246 billion generated in Q2 and ₦197 billion in Q3 2016. At ₦28.98 billion, manufacturing generated the highest VAT followed by professional services and oil production, both generating ₦22.73 billion and ₦12.09 billion respectively. The three sectors at the bottom of the generating chain are mining, local government councils and pharmaceuticals, soaps and toiletries which generated ₦33.70 million, ₦184.42 million and ₦193.78 million respectively. About ₦125.13 billion was generated as non-import VAT locally, while ₦72.10 billion was generated as non-import VAT for foreign. The balance of ₦53.33 billion was generated as Nigeria Customs Service-import VAT.
  • The FG has budgeted ₦4.19 billion to pay consultants in the 2018 proposed budget for the construction of 700MW Zungeru hydropower project in Niger and the 3050MW Mambilla project in Taraba. A Daily Trust analysis of the budget proposal obtained from the Budget Office of the Federal Ministry of Budget and National Planning showed that the Power, Works and Housing ministry is to get ₦590 billion. From this, the ministry, headed by Babatunde Fashola and two other ministers, will use ₦434.9 billion for capital projects while ₦408 million will be used to pay for consulting and professional services, of which ₦20.5 million is for financial consulting; consulting for Information Technology gets ₦16.8 million, and ₦15.6 million for legal services. A further ₦355 million will go to what the ministry describes as ‘consultancy, survey and short-term studies.’
  • House of Representatives spokesman, Abdulrazak Namdas says it will take a minimum of three months for the 2018 budget to be ready. While presenting the budget to the National Assembly earlier in the month, President Muhammadu Buhari appealed to the lawmakers to send him the final budget by 1 January. In an interview with The Nation, Namdas said the January-to-December budget calendar was not feasible because there are about 20 legislative sitting days remaining in the year. He added that the lawmakers could not return the appropriation bill the way it was presented as they need adequate time to “work on it.” The Senate postponed a debate on the budget on Tuesday citing the need to pass the MTEF.
  • The Senate on Thursday announced the postponement consideration of the 2018-2020 MTEF and Fiscal Strategy Paper. Chairman of the Senate Joint Committee on Finance, Appropriation and National Planning, John Enoh attributed the action to some “discrepancies.” The MTEF/FSP, which provides the parameters upon which the national budget is prepared, was slated for debate and consideration on Thursday. Enoh said some matters contained in the report will need to be consulted on with the Joint Committee in the House of Representatives. Senate President Bukola Saraki directed the committee to ensure that the documents were presented on Wednesday.
  • DisCos say their intention to quit the business of selling electricity is informed by a ₦892 billion shortfall in the power sector. A spokesman for their industry body said the sector was not yet mature for the new Eligible Customer regulation that permits large customers to bypass DisCos and buy power from GenCos. Sunday Oduntan, spokesman for the Association of Nigerian Electricity Distributors said the EC regulation enacted by NERC two weeks ago will see a rise in tariff by at least 4 per kilowatt hour through a Competition Transition Charge on the residential customers who will be left on their networks. The BPE, which oversees the operations of privatised power firms said the DisCos issued a force majeure notice last Monday but said it lacked no basis and rejected it with the backing of NERC. Daily Trust reports that the force majeure declaration was not unanimous, with Abuja and Kaduna DisCos among those exempted from the quit notice.