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FG releases N200bn capital

by Business News Report

The Federal Ministry of Finance, said it has released the sum of N200 billion for the execution of various capital projects of Ministries, Departments and Agencies, MDAs, across the country. 

 Mr. Paul Nwabuikwu, Special Adviser to the Coordinating Minister for the Economy and minister of Finance, Dr. Ngozi Okonjo-Iweala, disclosed this in a statement saying that the decision to release the money very early in the year, “signposts the determination of the Federal Government to ensure that clear and measurable progress is achieved in the execution of capital projects”.

According to him,” this first release of capital expenditure for the year and will be followed by others”, although he did not say when the next tranche would be released.

The federal government capital budget for the current year stands at N1.245 trillion out of a total budget of N4.624 trillion which is still before the National Assembly.

Many federal legislators who are currently debating the 2014 Appropriation Bill have criticized this year’s 74 per cent Recurrent Budget and have promised to re-arrange the budget in such a way to increase the capital budget.

If they make good their promise, then the structure of the budget could be altered to give more money to MDAs for capital projects execution.

Dr. Ngozi Okonjo-Iweala, while presenting details of the 2014 federal government budget, on 20 January, lamented  the administrations’ dilemma over the boated recurrent expenditure

In her words, “the high share of recurrent expenditure in the budget is of great concern as it reduces the size of funds available for investments in capital projects.

“We worked hard to reduce this ratio from 74.4 % in 2011, to 71.5 % in 2012, and further to 67.5 % in 2013 but it has risen back to 74 % in 2014.” The minister said the nation “will need to make some tough choices in the future about the structure of our budget”, adding, “We need to strike a balance between growing a wage bill for the public sector and investing more of our resources in infrastructure projects”.

A total of N3.542 trillion has been earmarked for recurrent. It consists of N2. 239 trillion, representing about 37 per cent of the total budget for personnel cost, while N1.303 trillion has been earmarked for overheads. By implication, almost 40 per cent of the budget goes directly into the pockets of federal government workers who are only about one million in number.

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