The minister of finance, budget and national planning, Mrs. Zainab Ahmed yesterday faulted claims by the governor of Edo State that the federal government was borrowing without a sustainable plan to sort out the debt load and that it printed an additional N50-N60 billion to shore up revenue shared among the three tiers of government.
Speaking at the end of a meeting of the federal executive council held in Abuja, Ahmed said the governor’s comments were not only untrue but also unfortunate.
It would be recalled that Obaseki while speaking at the Edo state transition committee stakeholders’ engagement last Thursday, said the Nigerian economy was no longer what it used to be.
He said the rising debt profile is worrisome as dependence on crude oil is no longer sustainable.
“Nigeria has changed. The economy of Nigeria is not the same again whether we like it or not. Since the civil war, we have been managing, saying money is not our problem as long as we are pumping crude oil every day,” he said.
“So we have run a very strange economy and strange presidential system where the local, state and federal government, at the end of the month, go and earn salary. We are the only country in the world that does that.
“When we got FAAC for March, the federal government printed additional N50-N60 billion to top-up for us to share,” he said.
“This April, we will go to Abuja and share. By the end of this year, our total borrowing is going to be within N15-N16 trillion. Imagine a family that is just borrowing without any means to pay back and nobody is looking at that, everybody is looking at 2023, everybody is blaming Mr. President as if he is a magician,” he said.
However, Ahmed said the federal the government neither padded the federation account revenue nor exceeded the debt to gross domestic product ratio.
“The issue that has been raised by the Edo State Governor, for me, is very sad because it is not a fact. What we distribute at FAAC is a revenue that is generated and in fact distributed revenue is a public information. We publish it.
“So, it’s revenue generated by the FIRS, the Customs and the NNPC, that we distribute at FAAC. It is not true”, she said.
On the issue of borrowing without a repayment plan, the minister said the nation’s debt profile remains within manageable realms.
She added that the plan for the country is basically to improve its revenue generation in order to take care of both debt servicing and running of government.
“On the issue of the borrowing, the Nigerian debt is still within sustainable limits. What we need to do, as I have said several times, is to improve our revenue to enhance our capacity to service, not only our debt obligations, but to service the needs of running government on day to day basis.
“So our debt, currently at about 23 per cent to GDP, is at a very sustainable level. You can look at all the reports that you see from multilateral institutions, those facts are stated”, she added.
Meanwhile, Obaseki advised the government to stop playing the Ostrich.
“While we do not want to join (take) issues with the federal ministry of finance, we believe it is our duty to offer useful advice for the benefit of our country,”
“The minister of finance, budget and national planning, Mrs. Zainab Ahmed should rally Nigerians to stem the obvious fiscal slide facing our country,” Obaseki said in a statement.
He said rather than play the ostrich, the federal government should take urgent steps to end the current monetary rascality, so as to prevent the prevailing economic challenge from degenerating further.
“We believe it is imperative to approach the Nigerian project with all sense of responsibility and commitment and not play to the gallery because ultimately, time shall be the judge of us all,” he added.
