Politics
Senate Raises Alarm Over Proposed Supplementary Budget And Excessive Borrowing
Senate Raises Alarm Over Proposed Supplementary Budget And Excessive Borrowing....KINDLY READ THE FULL STORY HERE▶
The Senate has issued a stern warning to the executive, cautioning against enlarging the budget through a supplementary allocation. Instead, it advises utilizing the surplus savings anticipated from the recent devaluation of the naira to address deficits.
This admonition follows the depreciation of the national currency against the US dollar, soaring from N900/$ to over 1,500/$. The Central Bank of Nigeria’s efforts to harmonize the parallel and official exchange rates triggered this development.
In December, the National Assembly adjusted the 2024 budget benchmark exchange rate from President Bola Tinubu’s proposed N750/$ to N800/$. Senator Solomon Adeola, Chairman of the Senate Committee on Appropriation, attributed this alteration to economic realities, including prevailing exchange rates and external consultations on oil benchmarks.
Given the naira’s recent depreciation, the Senate advises against expanding the budget, fearing exacerbation of the country’s high inflation. Instead, it suggests diverting excess savings towards reducing the budget deficit, as outlined by Senator Tokunbo Abiru, Chairman of the Senate Committee on Banking, Insurance, and other Financial Institutions.
Abiru emphasizes the importance of prudence and moderation in government spending, especially amid volatile exchange rates. He underscores the need to await stabilized exchange rates before considering budget revisions.
Echoing similar sentiments, Senator Ali Ndume, Deputy Chairman of the Senate Committee on Appropriation, highlights the substantial savings accruing to Nigeria due to its dollar-denominated revenue sources. Ndume emphasizes that despite budget adjustments, Nigeria stands to gain from its dollar-earning capacity, translating into surplus funds for expenditure.
In essence, the Senate underscores the significance of leveraging surplus funds from currency fluctuations to mitigate deficits rather than expanding the budget, advocating for fiscal responsibility and strategic financial management.
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Source: Bushradiogist
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