The 2022 budget has been designed to be gender-responsive as Ministries Departments and Agencies (MDAs) have been mandated to factor in gender issues in their budget preparation.
What this means is that the recently approved paternity leave for civil servants will be captured in the 2022 budget among other gender-responsive issues the MDAs will consider to include in the budget.
In past budgets, travel and training provisions capture more men than women also most MDAs do have crèche for nursing mothers who are expected to resume work while tending to their infants.
Addressing the National Assembly before presenting the 2022 budget, President Muhammadu Buhari said “this is also the first in our history, where MDAs were clearly advised on gender-responsive budgeting”.
This decision President Buhari noted will form “part of critical steps in our efforts to distribute resources fairly and reach vulnerable groups of our society”.
The 2022 Appropriation has been tagged a Budget of Economic Growth and Sustainability has made fiscal assumptions and parameters with total federally-collectable revenue estimated at N17.70 trillion.
According to President Muhammadu Buhari “total federally distributable revenue is estimated at N12.72 trillion in 2022 while total revenue available to fund the 2022 Federal Budget is estimated at N10.13 trillion. This includes Grants and Aid of N63.38 billion, as well as the revenues of 63 Government-Owned Enterprises”.
A total expenditure of N16.39 trillion is proposed for the Federal Government in 2022 comprising: Statutory Transfers of N768.28 billion; Non-debt Recurrent Costs of N6.83 trillion; Personnel Costs of N4.11 trillion; Pensions, Gratuities and Retirees’ Benefits N577.0 billion.
Others include Overheads of N792.39 billion; Capital Expenditure of N5.35 trillion, including the capital component of Statutory Transfers; Debt Service of N3.61 trillion; and Sinking Fund of N292.71 billion to retire certain maturing bonds.
Giving these spendings, President Buhari disclosed that the federal government expects “the total fiscal operations of the Federal Government to result in a deficit of N6.26 trillion”.
This according to the President “represents 3.39 per cent of estimated GDP, slightly above the 3 per cent threshold set by the Fiscal Responsibility Act 2007”.
He defended the deficit crossing Fiscal Responsibility Act threshold by arguing that “Countries around the world have to of necessity over-shoot their fiscal thresholds for the economies to survive and thrive.
He added that “we need to exceed this threshold considering our collective desire to continue tackling the existential security challenges facing our country”.
The federal government plan to finance this deficit through new borrowings totalling N5.01 trillion, N90.73 billion from Privatization Proceeds and N1.16 trillion drawdowns on loans secured for specific development projects.
Speaking on the troubling level of borrowing the country has engaged in, President Buhari admitted that the borrowings have grown to a level of concern but assured that “the debt level of the Federal Government is still within sustainable limits. Borrowings are too specific strategic projects and can be verified publicly”.
Government, President Buhari said “used the loans to finance critical development projects and programmes aimed at improving our economic environment and ensuring effective delivery of public services to our people.
To this end, the government focused on: the completion of major road and rail projects; the effective implementation of Power sector projects; the provision of potable water; construction of irrigation infrastructure and dams across the country; and critical health projects such as the strengthening of national emergency medical services and ambulance system, procurement of vaccines, polio eradication and upgrading Primary Health Care Centres across the six geopolitical zones.
The government’s target over the medium term the President disclosed “is to grow our Revenue-to-GDP ratio from about eight per cent currently to 15 per cent by 2025”.
“At that level of revenues, the Debt-Service-to-Revenue ratio will cease to be worrying. Put simply, we do not have a debt sustainability problem, but a revenue challenge which we are determined to tackle to ensure our debts remain sustainable” President Buhari assured.
To enhance revenue mobilisation, the federal government Buhari said will continue with its strategies of achieving the following objectives: enhance tax and excise revenues through policy reforms and tax administration measures; review the policy effectiveness of tax waivers and concessions; boost customs revenue through the e-Customs and Single Window initiatives; and safeguard revenues from the oil and gas sector.
The 2022 budget parameters are predicated on 2022 to 2024 Medium Term Expenditure Framework and Fiscal Strategy Paper which set out the parameters as follows: oil price benchmark of US$57 per barrel; daily oil production estimate of 1.88 million barrels (inclusive of Condensates of 300,000 to 400,000 barrels per day); exchange rate of four N410.15 per US Dollar; and Projected GDP growth rate of 4.2 per cent and 13 per cent inflation rate.
In 2022, Government has pledged to strengthen the frameworks for concessions and public-private partnerships (PPPs). “Capital projects that are good candidates for PPP by their nature will be developed for private sector participation,” the President said.
Also in the coming year, the government will “explore available opportunities in the existing ecosystem of green finance including the implementation of our Sovereign Green Bond Programme and leveraging debt-for-climate swap mechanisms”.