FG To Slash 2016 Budget, Spike Debt Ratio

The Minister of Finance, Kemi Adeosun,has hinted that federal government has opted to reduce total budgetary spending on 2016 capital expenditure plan ahead of indication that the budget would not be implemented fully.

Adeosun, who gave this indication in London while addressing international investors, said the decision was favoured against an option of increased borrowing to plug the increasing revenue gap.

The Minister said the government would not want to raised its debt to GDP ratio in 2016, but hinted that the ratio would eventually go up over the next three years to about 20 per cent from current 13 per cent, indicating the current government under President Mohammadu Buhari would be borrowing annually throughout its first term.

The government had planned to borrow both from domestic and international markets to plug its 2016 budgeted deficit of N2.2 trillion. Meanwhile, the minister had stated that the treasury single account, TSA, has witnessed significant increase in revenue to N3.3 trillion in May, up from N2.9 trillion in March.

She also noted that the ministry was continuing to unearth pockets of revenue that had escaped its net, including visa fees, airport landing charges and shipping levies.