Senate President Ahmad Lawan has warned against further wanton borrowings by the Federal Government to fund development projects, saying although borrowings cannot be completely eliminated, the government must do its utmost best to minimise its rising debt profile.
Proferring ideas on how borrowing could be drastically reduced, he advised that the incoming members of the National Assembly must curtail the trend.
Lawan spoke, Thursday, at a ceremony to mark his 64th birthday in Abuja.
The Debt Management Office (DMO) puts the nation’s total debt stock as at the third quarter (Q3) of last year at N44.06 trillion, even as this year’s national budget of N21.82 trillion comes with a N10.78 trillion deficit, necessitating further borrowings.
Hobnob News reports that President Muhammadu Buhari’s penchant for new borrowings has been predicted to jerk up Nigeria’s debt profile to over N77 trillion by May 29, 2023 from the current amount of N44.06 trillion as at third quarter of last year, highly competent source has said.
While the “Ways and Means” facility of the Central Bank of Nigeria (CBN) is already standing at about N22.3 trillion with an interest rate of 18.5 per cent, government is expected to borrow additional N8 trillion before it exits office on May 29, this year.
The Director-General of the Debt Management Office (DMO), Patience Oniha disclosed this on Wednesday, January 4, 2023.
According to Oniha, the country’s debt already crossed the N44 trillion mark in September 2022, and immediately after the National Assembly approves the securitization of the CBN’s ‘Ways and Means,’ the amount would be added to the national debt.
She said the move will bring the total debt profile to N77 trillion if the new loans are added.
Against this backdrop, Lawan suggested the need for government to make its Ministries, Departments and Agencies (MDAs) to generate more revenues and also review waivers and concessions already granted to corporate entities, disclosing that the Senate would, before its dissolution, engage the MDAs on ways to improve their revenue generation duties.
Lawan said: “Definitely, we need to work hard on revenue generation and collection by the Ministries, Department and Agencies (MDAs) and other government agencies.
“I also believe that this is something that will spill to the next administration because it is not like we can fix it in the next few months.
“For those of my colleagues who will be returning to the National Assembly, this should be a very important matter for the next Assembly to continue to deal with, because we just cannot afford to continue borrowing.
“We should minimize it. I know it is not possible to eliminate it completely, but we should minimise it.
“The next Assembly should do that. I don’t know how, but definitely, from our experience of today and even before today, we can do better in getting more revenues for government to deploy for development.
“For some of our colleagues who are going to Government Houses, the issue is very clear.
“We need the Federal Government as well as the states to work more closely because whatever the Federal Government does, if there is no participation or support or complementarity from the states, it won’t work.”
He added: “One other challenge is the lack of sufficient revenues for government to undertake its numerous laudable and noble national development projects across the country.
“Most of what we do in terms of national development is to borrow funds for us to execute those projects.
“I think we have to work hard to improve our revenue generation and collection because it is not looking too sustainable that we tolerate people and some agencies of government, to misapply or not even declare the revenues they collect. We can’t continue with that.”
“For us in the Senate, we have decided that for the remaining part, we will continue to engage with our revenue-generating agencies until we get better outcomes from them. This is possible and has become imperative.
