Recurrent expenditure to reduce to 72 per cent next year – Okonjo-Iweala

Posted by admin Latest Politics, Ministries Friday, September 23rd, 2011

The Coordinating Minister for the Economy, Dr Ngozi Okonjo-Iweala, has said that recurrent expenditure in next year’s budget is to be reduced from 74 to 72 per cent.

Okonjo- Iweala made the disclosure at a forum organised by ThisDay Newspapers at the ongoing annual meeting of the World Bank and the International Monetary Fund in Washington on Thursday.

The forum with theme “Nigeria: Beyond the Banking Reforms’’, was attended by stakeholders in various financial institutions in Nigeria and some foreign partners.

“We are trying to do a four years budget, as you all know, the structure of the budget in Nigeria is not right.

“74 per cent of the budget is recurrent expenditure and that is too high.

“What we try to do is a four-year plan to bring down the recurrent expenditure from 74 per cent to 72 in 2012 and by the time we finish in 2015, it should be under 70 at about 69 to 68 per cent,’’ she said.

She added that reducing recurrent expenditure would be the trend in trying to restructuring the economy, adding that capital project would be going on in tandem with about 22 per cent of the total budget by 2015.

She said that a decision had been taken to maintain fiscal deficit of not more than three per cent.

“Actually we are targeting below that for this fiscal year about 2.69 per cent , then trending down with the fiscal deficit so that we can bring our spending and revenue picture in line,’’ she added.

Okonjo Iweala said that efforts are being made to improve revenue in the country by ensuring that cooperate bodies in the country would be made to pay taxes and do proper remittance.

“It is not only cutting expenditure that we are looking at but also looking at increasing revenues from both internally-generated funds within the government.

“We have some agencies that are revenue earning that don’t remit as well as collecting taxes when they are due,’’ she said.

Malam Sanusi Lamido Sanusi, the Central Bank of Nigeria (CBN) Governor, said that good fiscal policies would help to move the economy to the appropriate level.

He said the basic way to move the nation’s economy was to unlock the value chains.

“ I always say that if you want to understand what is wrong with the Nigerian economy, think of the value chain.

“If you just do that you will unlock all the problems,’’ he said.

He assured that the CBN would continue to work to ensure that with good fiscal environment, the Nigerian economy would take its place among the comity of nations.

Also speaking, Mrs Obiageli Ezekwesili, the World Bank Vice President for the African Region, urged stakeholder to work together to ensure that the Nigerian economy was improved.

“This is a collective effort, Ngozi alone cannot do it.

“It is no longer news for us to hear that Nigeria has all the potential but what will be news is for the world to see that jobs are created and living standard of Nigerians improved,’’ she said. (NAN)

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