As delivered by President Muhammadu Buhari on Tuesday, Dec. 22 to a Joint Session of the National Assembly; read 17 important things the President said in his 2016 Budget speech.
1. By June 2014, oil prices averaged $112 per barrel. But as at today, the price is under $39 per barrel. This huge decline is having a painful effect on our economy. Consumption has declined at all levels. In both the private and public sectors, employers have struggled to meet their salary and other employee related obligations. The small business owners and traders have been particularly hard hit by this state of affairs.
2. Fellow Nigerians, the confidence of many might be shaken. However, I stand before you today promising that we will secure our country, rebuild our economy, and make the Federal Republic of Nigeria stronger than it has ever been.
3. The answers to our problems are not beyond us. They exist on our farmlands; our corporations; in the universities in the hearts and minds of our entrepreneurs; through the gallantry of our Armed Forces; and the resolute spirit of Nigerians, especially the youth, who have refused to give up despite all the obstacles confronting them.
4. This Budget proposal, the first by our Government, seeks to stimulate the economy, making it more competitive by focusing on infrastructural development; delivering inclusive growth; and prioritizing the welfare of Nigerians. We believe that this budget, while helping industry, commerce and investment to pick up, will as a matter of urgency, address the immediate problems of youth unemployment and the terrible living conditions of the extremely poor and vulnerable Nigerians.
5. In the medium to longer term, we remain committed to economic diversification through import substitution and export promotion. This will build resilience in our economy. It will guarantee that the problems we have today, will not confront our children and their children. This shall be our legacy for generations to come.
6. Despite the weak emerging MARKETgrowth rates, our domestic security challenges, declining oil prices, and the attendant difficulties in providing foreign exchange to meet market demands, the Nigerian economy grew by 2.84% in the third quarter of 2015.
7. We have, and will continue to implement strategies that will maintain macroeconomic stability and manage the oil price shocks we are experiencing.
8. Upon the inauguration of this administration on 29th May 2015, we engaged key stakeholders from various sectors of our economy and interfaced with the heads of Ministries, Departments and Agencies (MDAs) in order to understand the true state of our nation. What we found prompted us to take certain strategic decisions.
9. On the economy, we injected new leadership at the helm of our revenue generating agencies including the Federal Inland Revenue Service (FIRS), Nigerian National Petroleum Corporation (NNPC), Nigerian COMMUNICATIONS Commission (NCC), and the Nigerian Customs Service (NCS). We implemented the Treasury Single Account (TSA) which, so far, has provided greater visibility of Government revenues and cash flows. We intervened to support States to navigate their fiscal challenges by restructuring their commercial bank loans and by providing facilities to enable them to pay salary arrears.
10. We have demonstrated a strong will to fight corruption. I am sure you will agree that the sheer scale of corruption and impunity of the past explains in part, the economic challenges we now face. On these initiatives, and the many more to come, we shall not be deterred. We will pursue the recovery of everything that belongs to the people of Nigeria. No matter where it is hidden. No matter how long it will take.
11. Distinguished and honourable members of the National Assembly, I now present a review of the 2015 Budget. That Budget was based on a benchmark oil price of $53 per barrel, oil production of 2.28 million barrels per day and an exchange rate of N190 to the US$.
12. After reviewing the trends in the global oil industry, we have set a benchmark price of $38 per barrel and a production estimate of 2.2 million barrels per day for 2016. We have focused on non-oil revenues by broadening our tax base and improving the effectiveness of our revenue collecting agencies.
13. Also, with the full implementation of the Treasury Single Account, we expect significant improvements in the collection and remittance of independent revenues. To further support the drive for increased remittances, we will ensure that all MDAs present their budgets in advance, and remit their operating surpluses as required by section 22 of the Fiscal Responsibility Act.
14. The 2016 budget, as outlined, is designed to ensure that we revive our economy, deliver inclusive growth to Nigerians and create a significant number of jobs.
15. We will invest in training our youths, through the revival of our technical and vocational institutions, to ensure they are competent enough to seize the opportunities that will arise from this economic revival.
16. Indeed, the future looks bright. And I ask that we all work together to make this vision a reality. The 223% year on year growth in capital expenditure demonstrates our desire to make Nigeria more competitive, and start the journey to deliver sustainable development in our country.
17. In fulfillment of our promise to run a lean government, we have proposed a 9% reduction in non-debt recurrent expenditure, from N2.59 trillion in the 2015 Budget to N2.35 trillion in 2016. Furthermore, we have budgeted N300 billion for Special Intervention Programs, which takes the total amount for non-debt recurrent expenditure to N2.65 trillion.