President Muhammadu Buhari has proposed N8.6trn for the 2018 financial year.
The President disclosed this at the Joint Session of the National Assembly on Tuesday in Abuja, during the presentation of the 2018 Budget Proposal.
Buhari assured that the 2018 budget would be a consolidation of the earlier ones, noting that 2018 is expected to be a year of better outcomes, while describing the document as “Budget of Consolidation.”
The budget forecast a deficit of 2.005 trillion naira ($6.56 billion), down from last year’s 2.36 trillion naira, in a country that just clambered out of its first recession for 25 years in the second quarter of 2017, but still grew slowly.
Each of President Muhammadu Buhari’s budgets has set a record high level of spending, but economists say implementation, particularly on capital expenditure that is meant to drive infrastructure development, has been lacking.
They have also noted that while the budgets reach new highs, they are rising at a slower clip than inflation. The new budget is about 16 percent higher than the previous year‘s, while Buhari said inflation for 2018 is expected to be 12.4 percent.
Buhari told the lawmarkers that the budget was based on an exchange rate of 305 naira to the dollar and a projected oil output of 2.3 million barrels per day at an assumed price of $45 per barrel.
He said he was targeting Jan. 1, 2018 for passage of next year’s budget and that the deficit is expected to be 2.005 trillon naira, with real economic growth estimated at 3.5 percent for 2018.
But previous budgets have been beset by wrangling with lawmakers over line items. The 2017 budget was not signed into law until halfway through this year, and even then certain spending was still being debated.
The 2018 budget must still be approved by the lower and upper legislative chambers before it can be signed into law, a process that can take many months.