As President Bola Tinubu prepares to present the 2025 budget to the National Assembly this week, the Senate, on Tuesday, gave its approval to the 2025–2027 Medium Term Expenditure Framework and Fiscal Strategy Paper submitted earlier by the President.
This decision was based on the adoption of a report presented during plenary by the Senate’s joint Committees on Finance and National Planning & Economic Affairs, led by Senator Sani Musa (APC, Niger East).
This was even as the Red Chamber mandated its Committees on Finance; Petroleum (Upstream) and Petroleum (Downstream) as well as Gas to investigate reports from the Revenue Mobilisation, Allocation and Fiscal Responsibility Commission, alleging that the Nigerian National Petroleum Company Limited withheld N8.48tn as claimed subsidies for petrol.
It noted that the investigation would address the Nigeria Extractive Industries Transparency Initiative, NEITI report, stating that NNPCL failed to remit $2bn (N3.6tn) in taxes to the Federal Government.
The Senate further directed its committees to verify the total cumulative amount of unremitted revenue (under-recovery) from the sale of Premium Motor Spirit, PMS also known as petrol by the NNPCL between 2020 and 2023.
It, however, directed the relevant committees to carry out an in-depth investigation of such agreements by the NNPCL, Nigerian Liquefied Natural Gas, NLNG, and Immigration Services with a view to reconciling remittances to the Federation Account.
In the three-year projections, the Senate pegged the exchange rate at N1,400/$ for 2025, 2026, and 2027 respectively.
It also projected oil benchmark prices at $75, $76.2, and $75.3 per barrel for 2025, 2026, and 2027 respectively.
The Senate added that the three-year projections for domestic crude oil production had a significant increase from 1.78m bpd in the preceding year to 2.06, 2.10, and 2.35 for the subsequent years of 2025, 2026, and 2027, respectively.
It further projected Gross Domestic Product, GDP growth rates of 4.6 per cent, 4.4 per cent, and 5.5 per cent for 2025, 2026, and 2027.
The Red Chamber also projected the inflation rates at 15.75 per cent, 14.21 per cent, and 10.04 per cent for 2025, 2026, and 2027 respectively.
It, however, demanded a reduction in the petrol prices against the backdrop of the commencement of production at the Port Harcourt refinery.
According to the recommendations, “The 2025 Federal Government of Nigeria budget proposed spending of N47.9tn of which N34.82tn is retained. New borrowings stood at N9.22tn, made up of both domestic and foreign borrowings.
“Capital expenditure is projected at N16.48tn with statutory transfers standing at N4.26tn and sinking funds projected at N430.27bn.”
Speaking during the debate on the report, the Chairman of the Senate Committee on Appropriations, Senator Solomon Adeola (APC Ogun West) referenced the Federal Government’s Compressed Natural Gas, CNG initiative as the underlying imperative for the adoption of the N1,400 to one dollar.
“With the functioning of our refineries, the demand for Forex will drop. With the CNG initiative, Nigerians will have an option for your information if you leave Benin for Lagos the amount of fuel is about 130,000 but with CNG you can’t use more than N48,000. Another issue to be addressed is the recurrent to-capital ratio which is very high,” he said.
In his contribution, the former Senate Leader, Senator Yahaya Abdullahi (PDP Kebbi North), stressed the need to support the manufacturing industries if the projections of the MTEF are to be achieved.
In his remarks, the Senate President, Senator Godswill Akpabio commended the chairman and members of the joint committees for their in-depth analysis and general good work done on the document.
Senator Jimoh Ibrahim ( APC, Ondo South) in his contribution called for the adoption of transactional tax. He lamented that the rich in Nigeria aren’t paying adequate tax.
He said, “They need to pay more. It is comfortable for them to pay. I know they say they generate employment but they need to pay more for their luxury assets.
“This is the area we should develop. I am looking at laws that will actually police transactional costs. The government provides incentives for your business. What we are looking at is profit from your investment.
“The GDP to tax ratio is 18 per cent. About 72 per cent left out of the tax net. We should not worry that 72% are not in the tax net. I am not saying we should go and tax the poor population but the rich need to do more in these difficult times.”
In his remarks, the Chairman of the Senate Committee on Public Accounts, Aliyu Wadada ( SDP, Nasarawa West).
They decried that the Federal Inland Revenue Service in collaboration with NNPCL, Petroleum profit tax for a number of years has not been remitted to the right quarters.
He said, “The committee has written to both NNPC and the Federal Inland Revenue Service. FIRS responded with documents that have been tip-exed and handwritten and acclaimed to be from JP Morgan. This is extremely unacceptable and all efforts for the needful to be done has not been achieved.”
He added, “On Port Harcourt refinery, our colleagues were there, they saw what they saw but the question I have is from the day NNPC said Port Harcourt Refinery has commenced operation, how many trucks have been able to lift products from Port Harcourt Refinery.
“Technically, I have this for this senate to know about Port Harcourt Refinery, and unless and until NNPCL answers this question, we will not be bambosed into rushing to commending NNPC on Port Harcourt Refinery.”
