A revised 2015-2017 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) of N4.661 trillion budget estimate for 2015 fiscal year was on Wednesday submitted to the Senate by the Federal Government.
The budget which is in line with prevailing realities is lower by N146 billion, than the earlier N4.817 trillion proposed in the MTEF and FSP submitted last month by President Goodluck Jonathan.
The N4.661 trillion budget estimate for 2015, according to the document, will be predicated on $73 per barrel oil benchmark and a foreign exchange of N162 to a dollar.
This projection is also lower than the earlier proposal of $78 per barrel benchmark and an exchange rate of N160.00 to one dollar.
The National Assembly had on October 27 returned the first document to the executive, with the understanding that the $78 per barrel benchmark proposed by the executive for 2015 was unrealistic, in view of the dwindling oil price in the global market which dropped from $115 in June, to $78 per barrel.
The Upper Chamber therefore asked the executive to come up with a new document that would put into consideration the protracted drop in global oil revenue.
It was against this background that the Federal Government reviewed the figures in the new MTEF and FSP which it resubmitted to the Senate downward yesterday.
Also the fresh proposal benchmark of $73 per barrel marks a reduction of $4 and 50 cents from the $77.50 on which the current 2014 budget was predicated.
N4.661 trillion is N146 billion lower than the N4.724 trillion appropriated by the National Assembly in the 2014 budget, while the 2015 oil benchmark of $73 per barrel also marks a reduction of $4 and 50 cents reduction from the $77.50 on which the current 2014 budget was predicated.
The fresh document was accompanied by a letter from President Jonathan in which he explained that the downward review was necessitated by recent developments in the international oil market.
According to him, the revised edition of the MTEF and FSP was a product of consultations with key stakeholders which he said resulted in some adjustments made in the new document.
While the new MTEF and FSP showed a reduction in capital expenditure from the earlier proposed N1.436 trillion to N1.208 trillion, the Federal Government retained the recurrent expenditure of N2.622 trillion proposal in the first MTEF.
This capital expenditure also includes N184.8 billion Subsidy Reinvestment and Empowerment Programme (SURE-P) fund, as against the N259 billion proposed in the first MTEF.
The government also reduced the earlier N250 billion proposed as kerosene subsidy to N156 billion and drastically reduced the subsidy for petrol from N971.1 billion to N458.6 billion.
The government also reduced the budget projection for 2016 from N4.896 in to N4.733 trillion as well as the earlier N5.028 trillion for 2017 to N4.930 trillion.
It also reduced revenue target from N3.867 trillion for the year 2015 to N3.826 trillion, while it equally reduced the N4.016 trillion projection for 2016 to N3.948 trillion.
The document also contains a reduction from N4.279 trillion target for 2017 to N4.225 trillion. Revenue target in the current 2014 budget is N3.731 trillion.
However, the document retained the earlier oil production target in 2015 at 2.2782 million barrel per day.
This figure is lower than the 2.3883 million barrels per day target for the current 2014 budget. It also retained the projection of 2.3271 million barrels per day and 2.4067 million barrels per day for 2016 and 2017 respectively.