Fashola Seeks Amendment To Procurement Law

Babatunde Fashola, the Minister of Power, Works and Housing, on Monday, called on the National Assembly to quickly amend the procurement law.

The minister made the call at the public presentation of compendium entitled, ‘Proof of infrastructure delivery across Nigeria’, four-year special reports of the Federal Ministry Of Power, Works And Housing, in Abuja.

He said the existing procurement law excludes the people at the base of the nation’s economy, urging the National Assembly to quickly do something to amend the law.

“What we are now focused on is how to aggressively implement the Federal Executive Council approval for national maintenance. And we are starting with our offices in Abuja and other parts of the country. It is aggressive maintenance to improve the life value of the assets and also to create jobs. So it is by repairing toilets, fixing doors, items and furnitures, replacing fittings, painting buildings.

“We will be deliberately reach the most vulnerable people, people that President Buhari remains totally committed about, marsons, carpenters, plumbers, electricians.

And they are the dedicated supporters of the President. Please let us do something about that.”

Fashola said as at April 13, 2019, his ministry had signed 1417 consents and 2400 Certificates of Ownership, C of Os, adding that some of the people who got their C of Os had paid for their lands since 1990s but were not given documentations.

He noted that substantial achievements have made in power sector as electricity supply is going up while cost of running generators are coming down across the country.

Source: By Chidi Ugwu

Investors lose N713bn in April as stock market tumbles

Investors in the nation’s stock market lost N713bn in April as the stock market declined further, recording a N135bn loss on Tuesday.

The stock market opened the month with a market capitalisation of N11.672tn and an All Share Index of 31,041.42 basis points and closed with a market capitalisation of N10.959tn and ASI of 29,159.74bps on the last trading day of the month.

This brought the total losses recorded by equity investors on the Nigerian Stock Exchange to N713bn in April.

On Tuesday, the ASI shed 1.22 per cent to close at 29,159.74bps as the gains recorded in 26 stocks were offset by major losses recorded in 19 stocks.

Major losses were recorded in Dangote Cement Plc, Nestlé Nigeria Plc and Stanbic IBTC Holdings Plc.

A total of 543.924 million stocks valued at N8.2bn were traded in 4,682 deals, representing an 87.4 per cent and 278.8 per cent increase in volume and value traded, respectively,  as the year-to-date return worsened to -7.22 per cent.

The top traded stocks by volume were Cement Company of Northern Nigeria Plc (132.328 million units), FBN Holdings Plc (68.783 million units), Unilever Nigeria Plc (50.470 million units), Guaranty Trust Bank Plc (41.441 million units) and Dangote Flour Plc (37.882 million units).

The top traded stocks by value were Cement Company of Northern Nigeria (N1.86bn), Unilever (N1.56bn), GTB (N1.38bn), Dangote Flour (N712m) and FBN Holdings (N497m).

Performance across sectors was largely bullish as three of five indices closed on a positive note.

The oil and gas index was the highest gainer, up by 1.50 per cent following buying interest in Seplat Petroleum Development Company Plc and Forte Oil Plc.

Similarly, the insurance index advanced by 0.11 per cent on the back of major gains recorded in Lasaco Assurance Plc.

The banking index recorded a marginal gain of 0.08 per cent due to major gains in Zenith Bank Plc and Access Bank Plc.

On the flipside, the industrial goods index led decliners, down by 3.19 per cent as a result of profit-taking activities in Dangote Cement Plc and Cement Company of Northern Nigeria.

The consumer goods index declined by 0.67 per cent as a result of major losses witnessed in Nestlé and Dangote Sugar Refinery Plc.

Investor sentiment, as measured by market breadth (advance/decline ratio), strengthened to 1.4x from 1.0x recorded on Monday.

The top performers were UACN Property Development Company Plc, Japaul Oil and Maritime Services Plc and Caverton Offshore Support Group Plc, which gained 10 per cent each; and Forte Oil Plc and Dangote Flour Mills Plc, whose respective share prices gained 9.97 per cent and 9.94 per cent.

The top five losers were Cutix Plc, Goldlink Insurance Plc, Cement Company of Northern Nigeria, Unity Bank Plc and Nascon Allied Industries Plc, which saw their share prices shed 9.76 per cent, 9.09 per cent, 8.79 per cent, 5.88 per cent and 4.74 per cent, respectively.

Analysts at Afrinvest Securities Limited said, “In the near term, we expect to see bargain hunting activities due to the attractive entry prices of several fundamentally-sound stocks in the market, although this may be short-lived in the absence of major growth triggers in the economy.”

Source: By Feyisayi Popoola

N30,000 new minimum wage implementation resonates on Workers’ Day

The Federal Government on Wednesday pledged its commitment to fully implement the new minimum wage of N30,000 recently signed into law by President Muhammadu Buhari.

Many state governors in the country made a similar commitment, promising to implement the new minimum wage as soon as the National Salaries, Income and Wages Commission worked out the guidelines and modalities.

These commitments were made during the celebration of the 2019 International Workers’ Day in Abuja and in state capitals across the country.

This is even as labour unions in the country lamented the high rate of inflation and rising unemployment in the country, suggesting that the 67 percent increase in the national minimum wage from N18,000 to N30,000 may not have achieved much in view of the current economic realities.

In his remarks at the Workers’ Day rally at the Eagle Square in Abuja, President Buhari, who was represented by Vice President Yemi Osinbajo, stressed that the Nigerian workers and citizens were the central hub of all economic policies and programmes of his government.

“We believe that the Nigerian citizen should be the central hub of all economic policies and programmes of government, their welfare and wellbeing should be the benchmark of our commitment for social justice to all Nigerians,” Buhari said.

“The National Minimum Wage which the president signed into law a few days ago shall be fully implemented by this administration. We shall continue to provide enabling environment for high productivity and industrial peace and harmony,” he said.

The president praised the leadership of the labour movement, led by the Nigerian Labour Congress (NLC) and the Trade Union Congress (TUC), and also lauded the International Labour Organisation (ILO) for the event, which coincided with the 100 years of the ILO and 60 years of the ILO in Africa.

The theme of the day, ‘Another 100 Years of Struggle for Jobs, Dignity and Social Justice in Nigeria’, he said, was apt, even as he lauded the ILO for supporting Nigeria in the implementation of labour-related policies, programmes and action plans against hard labour, forced labour and modern slavery. He also reiterated the Federal Government’s commitment to job creation and protection of the rights and dignity of workers.

Also speaking in Ibadan, the Oyo State capital, Governor Abiola Ajimobi assured workers of his administration’s resolve to pay the N30,000 minimum wage without delay.

The governor, whose speech was read by his deputy, Moses Adeyemo, said as soon as the ongoing negotiations initiated by labour leaders with the government were concluded and documented, the enhanced salaries would be paid to elevate the living condition of the workers.
“I wish to restate the commitment of the government of Oyo State to honouring the Minimum Wage Act as soon as ongoing negotiations are concluded and necessary templates and documentation are issued,” Ajimobi said.

“I charge all workers to reciprocate the various good gestures of the state government by being more dedicated, proactive and punctual at their duty posts for increased productivity. The public service is no longer a dumping ground for people with mediocre ability. We all must stand up and stand right to reposition the system for better service delivery,” he said.

In Akwa Ibom State, Governor Udom Emmanuel promised to implement the new minimum wage “after necessary documentations have been effected”.

In Bayelsa, Governor Seriake Dickson assured organised labour that his government would be among the first in the country to pay the new minimum wage.

Speaking in Yenagoa, Dickson said the state would pay once the National Salaries, Income and Wages Commission worked out the modalities.

In Edo, the state government said it would constitute a joint committee made up of organised labour and representatives of government for the implementation of the new minimum wage.
Godwin Obaseki, the state governor, speaking during the May Day celebration at the University of Benin sports complex in Benin City on Wednesday, said the committee would finalise modalities for the payment of the new minimum wage.

He noted that the state government had last October promised to pay the minimum wage once the bill was passed by the National Assembly and assented to by President Buhari.

“Now that Mr President has assented to the enacted bill passed by the National Assembly, Edo State is ready to commence immediately the implementation of the new minimum wage, even though we are awaiting the detailed guidelines which will be issued by the National Salary, Income and Wages Commission,” Obaseki said.

“Before that happens, a joint team of representatives of labour and government will be constituted immediately to finalise the modalities for payment,” he said.
He, however, tied the implementation of the minimum wage in the state to improved revenue, tasking workers on higher productivity.

In Anambra, Governor Willie Obiano said his administration would be one of the first few states to pay the new national minimum wage once Federal Government released payment guidelines.
“I have formally declared the intention of my administration to pay the newly approved minimum wage in the state. And I will begin the implementation once the guidelines for the payment of the minimum wage are released by the Federal Government,” Obiano said in his address to workers in Awka on Wednesday.

“All the demands tabled before the Special Committee on Labour Issues headed by my deputy, Nkem Okeke, have been approved in principle,” Obiano said.

In Ondo, Governor Rotimi Akeredolu said his administration would pay the N30,000 new minimum wage, assuring workers that their welfare was paramount to the government.
“Let me inform our workers today that Ondo State government will pay the new minimum wage as approved by law. The welfare of workers is paramount to us and we believe you must get your pay because you are very important to us. The new minimum wage is non-negotiable, it is your right,” Akeredolu said.

“We all know that the N18,000 cannot take you home, but hopefully, this new N30,000 will take you home. This government will pay the minimum wage,” he said.

In Taraba State, however, workers who thronged the Jolly Nyame Stadium in Jalingo to celebrate the Workers’ Day left the venue disappointed as Governor Darius Ishaku failed to comment on the implementation of the new minimum wage in the state.

Ishaku’s speech, which was read by the deputy governor, Haruna Manu, maintained tactical silence on the issue of minimum wage but promised to commence payment of the backlog of pension and gratuity of retired civil servants.

“The governor came back yesterday (Tuesday), but he didn’t show up to address us on an important day like this. We were all expecting to hear the good news, but unfortunately, he didn’t show up and his speech which was read by the deputy governor was silent on the issue of minimum wage,” said a civil servant who spoke to our correspondent on condition of anonymity.

“The pension and gratuity he promised to pay are our entitlements and he is not doing workers any favour. We expect the governor to address the issue of minimum wage very soon because things are not getting better,” the civil servant said.

Source: By INNOCENT ODOH and REMI FEYISIPO

Navigating through the storm of “needs”

More often than not, decisions on and plans executed towards meeting needs leads many into being pressured and overwhelmed by this pursuit. Hence, navigating through the storm of conflicting needs and wants may require proper planning and execution.

An average family man in Nigeria is faced with day to day basic needs shelter, clothing, feeding and security for his family, all expected to be met within the constraint of his income which in most times is limited.

A pilot survey of major needs that accounts for a larger portion of family’s streams of income streamlined the list to paying of rents and children school fees amongst others; which will be a major focus of our discussion.

Housing Challenges

Housing has been a major challenge in Nigeria for decades and there seems to be a preponderance of ineffective or motionless housing policies that has led to the inability of government to address the housing challenge.

Housing deficit in the country has been estimated around 20 million in the thought of Prof. Yemi Osinbajo, Nigeria’s vice president at the unveiling of the Federal Mortgage Bank of Nigeria (FMBN) Digital Platform at the International Conference Centre, Abuja last year.

Faced with this challenge mostly are the middle and lower income earners, whose incomes are not sufficient enough to adequately cover housing cost hence, necessitating the need to effectively appropriate funds to alleviate the challenge?

Challenge of paying children’s school fees

An average Nigerian parent would love to send their children to very good schools. However this may demand higher cost as relatively, good schools are expensive.

This is not to say however that all expensive schools are good schools but there are higher chances that a cheap school may not deliver the best value to children.

For example, some analysts have argued that current government schools have failed to deliver value to students. Therefore a parent seeking value for their kids would prefer to enroll such in private schools.

BusinessDay speaking with some successful parents who have been able to weather the storm of conflicting needs have this to tell that the challenge isn’t a rocket science.

Here are important points noted by some in response to this

Cut your coat according to your cloth

This is another way to say to plan one’s aims and activities in line with one’s resources and circumstances. Living within one’s income is key in this regards in other to avoid undue pressures.

Research have proven that most people are prone to purchasing ‘‘wants’’ rather than ‘‘needs’’. Needs are something that you must have, in order to live. On the contrary, wants are something that you wish to have, so as to add comforts in your life.

A man coveting to live in a duplex which cost N3.5 million with a gross annual salary of N2 million is basically wanting. If peradventure he gets it through ceasing income opportunities, needs to ask the question of sustainability of such move.

Same goes for the payment of school fees. The cost of a school doesn’t necessarily translate into quality; however the quality of a school may translate to higher cost.

Speaking with Mr James Akinola, a successful civil servant who has trained four children in all school levels indicated that, ‘‘there are still good schools which are within the confine of an average Nigerian income.’’

‘‘what is most important is the seriousness of the kid and the post education parents give their kids when they are back from school,’’ he further explained.

Birth Control

Ironically there is this believe that the poor gives birth to more children than the rich despite being financially handicapped. The financial capability of parents should determine most times the number of kids born into the family.

Across the streets of Lagos are under aged children hawking and struggling to survive. Although sex is regarded as a basic need of man, preventive measures can be put in place to prevent a child coming into the world to suffer.

With fast rising population in the country which is estimated to grow to about 402 million people in 2050 according to the Census Bureau of the United States and rising unemployment rate, there is more pressure on the nation’s resources.

Analysis has shown that growth in GDP is slow compared to growth in population leaving more Nigerians poorer by the day.

In conclusion, analysts also further advice for multiple streams of income to help reduce the pressure of conflicting needs.

Source: By David Ibidapo

World Bank To Support Nigeria’s Off-grid Project with $225m Fund

Nigeria has been named among countries in the West Africa sub-region to benefit from off grid support programme by the World Bank.

The board of the World Bank Group reportedly approved a series of funding for the Regional Off-Grid Electrification Project (ROGEP) for selected countries in West Africa and the Sahel region.

The funds include $150 million in the form of credit and grant from the International Development Association and $74.7 million contingent recovery grant from the Clean Technology Fund in a bid to assist the West African Development Bank and ECOWAS’ Center for Renewable Energy and Energy Efficiency expand off-grid access to electricity for countries. Among the beneficiaries are: Nigeria, Benin, Burkina Faso, Cabo Verde, Cameroon, Central African Republic, Chad, Cote d’Ivoire, The Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Mauritania, Niger, Senegal, Sierra Leone and Togo.

The overall objective of ROGEP is to increase electricity access of households, businesses, and public institutions using modern stand-alone solar systems through a harmonised regional approach.

The project is expected to benefit about 1.7 million people currently living without electricity connection or with unreliable supply, as well as businesses and public institutions who will use modern stand-alone solar systems to improve their living standards and economic activities.

Coordinating director for regional integration in West Africa, ROGEP, Rachid Benmessaoud said “So far, only three per cent of households in West Africa and the Sahel are served by stand-alone solar home systems, and 208 million people in the sub-region do not have access to electricity, noted According to Benmessaoud, the project seeks to assist regional policy makers to address barriers to create a regional market for standalone solar systems which is essential to reduce energy poverty in the region.

“The new project will help adopt regional standards and regulations to establish a regional market with harmonised policies that will attract larger market players for the benefit of all participating countries,” Benmessaoud added.

Source: By Chika Izuora

Nigeria Not Sliding Into Economic Recession – CBN

Fears expressed on Monday by the Nigeria Governors’ Forum (NGF) that Nigeria is heading for another recession has been allayed by the Central Bank of Nigeria (CBN).

The NGF through its chairman and governor of Zamfara State, Abdulaziz Yari, had warned that Nigeria may enter into another recession next year if urgent measures were not taken to address the current unfavourable economic trends. In a swift reaction yesterday, the apex bank said that Nigeria is currently experiencing steady but marginal growth just as it is already coming out of high inflation rate.

At the unveiling of the International Monetary Fund (IMF) regional economic outlook for sub-Saharan Africa in Abuja yesterday, CBN deputy governor for Economic Policy Directorate, Joseph Nnana, said: “Right now, we are on the path of achieving our price stability goal of single-digit inflation. Are we going to witness increased inflation or are we sliding back into recession? My answer is no.

We are making smooth progress towards growth and by the end of 2019, all things being equal, we are going to likely have between 2.8 and three per cent Gross Domestic Product (GDP) growth rate.”

Nnana, however, said that the GDP growth was not adequate, noting that Nigeria currently has a three per cent GDP real growth rate, with a population growth rate at 3.2 per cent. According to him, “per capita growth rate is still negative but definitely, we are not going through the era of 2016 when we had a recession.

That won’t happen. Hopefully, not under the CBN watch.” On the state of the economy, Nnana said that for the money market, “our promise to external investors be they portfolio investors or foreign direct investors is that we are going to continue to maintain positive relationship.

And the yield in Nigeria is comparative if not more superior to the yield in other emerging market economies. “Those who want to invest in the last frontier market, the place to be is here,” Nnana stated, adding that “our I&E window is a market for willing seller and willing buyer. The CBN will not intervene in that market to fix prices,” he said.

Nnana recalled that the problem of Nigeria is underemployment because majority of Nigerians are employed one way or another but they are functioning below capacity. They are engaged in the informal sector which is not performing optimally, he said.

“We also have a huge infrastructure deficit. Infrastructure is the major constraint to economic development and growth. This has to be repaired,” he added. In the IMF outlook, the Bretton Woods’ institution said that current policies growth was hovering around two-and-half per cent. Nigeria’s economy is recovering but the challenges are there, the IMF said, adding that the growth rate was 1.9 per cent in 2018; up from 0.8 per cent in 2017, while per capital growth remains negative. The IMF also said that Nigeria’s non-oil revenue mobilisation (3.4 per cent of GDP) is still one of the lowest in the world.

As a remedy, the IMF said that immediate actions were needed to realise Nigeria’s growth potential, revenue-based fiscal consolidation to create space for higher capital and priority spending while improving spending efficiency. It advised Nigeria to maintain a tight monetary policy while adopting a unified market-determined exchange rate and strengthening the banking sector resilience.

“Addressing structural challenges to boost the diversification business environment, governance, power sector reform, public investment efficiency, health and education, financial inclusion, gender equality, structural reforms to boost diversification are also critical,” IMF stated.

The permanent secretary in the Federal Ministry of Finance, Mohammed Dikwa who represented the minister of finance said that although Nigeria’s growth is marginal, it would be sustained. He said that the government would continue to put more efforts to ensure that the right things were done to strengthen the economy.

Dikwa said that 30 per cent of the revenue that comes into the Consolidated Account was being spent on the implementation of the budget. The permanent secretary said that the government was working hard to lift Nigerians out of poverty, create jobs and increase financial releases for infrastructural funding while expanding tax levies, with focus on the search for alternative sources of revenue.

As part of efforts to ensure human capital development, Dikwa said that the government was leveraging on Information Communication Technology (ICT) to build capacity and as it had resolved to inject more funds into the productive sector. Meanwhile, the CBN has said that it would sanction Deposit Money Banks (DMBs) and financial institutions that reject worn out notes or dispense mutilated notes and counterfeit currencies.

The apex bank called for an increase in private companies participating in currency management value chain to enhance its clean note policy. CBN governor, Mr. Godwin Emefiele, who spoke yesterday in Lagos at the unveiling of the bank’s “Clean Notes Policy and Banknotes Fitness Guidelines”, declared that bank notes remain important for payments and settlement of commercial transactions in Nigeria, which accounts for why the organisation takes currency wellbeing very important. Emefiele, who was represented by the CBN deputy governor for Operations, Mr. Folashodun Shonubi, said that “it is worth noting that the bank has the responsibility for preserving the integrity of the Naira and sustaining public confidence in the national currency as enshrined in Section 2 of the CBN Act 2007. To attain these objectives, the bank strives to ensure an optimal supply of clean and quality banknotes in a balanced denominational mix to meet public demand, while also maintaining a balanced currency structure that is both efficient and cost-effective, he said.

Emefiele said: “The responsibility for clean notes in circulation is not exclusively that of the Central Bank, rather collaborative efforts among CBN, banknote suppliers, deposit money banks, manufacturers of currency management equipment, currency transportation and processing companies, security agencies, and the general public.

“I commend the existing collaboration between the CBN and the stakeholders in the currency management value chain, and wish to stress that this should be deepened and strengthened for the overall good of the industry. “Currency management is vital to our daily lives because despite the improvements in the electronic payment system, banknotes remain predominant for payment and settlement of commercial transactions in Nigeria,” the CBN boss said. The effective use of these documents by relevant stakeholders would ensure that banknotes in circulation are clean and of high quality.

Characteristics that are key to sustaining public confidence in the national currency, he said. Emefiele continued: “Permit me to mention some key policy measures being pursued by the bank towards promoting effective and efficient currency management in Nigeria. On encouraging more private participation, the bank is encouraging more companies in currency management. “The bank has registered eight companies to carry out cash-in-transit and two cash processing companies to operate in Nigeria.

Deposit money banks are expected to patronise only these registered companies for Cash-in-Transit (CIT) and sorting services. “It is expected, therefore, that more private sector participation in the currency management value chain would further strengthen the efforts toward ensuring the availability of clean banknotes.” “I wish to use this opportunity to inform the industry that the CBN, as part of its effort towards devolving the retail cash management to the private sector has approved the revised guidelines for registration of CIT/CPCs.

These guidelines provide for the operation of CITs and Cash Processing Companies (CPCs) at both national and regional levels. It is hoped that this would encourage unregistered companies to come under the regulatory purview of the CBN and ensure a nationwide coverage of these services,” he said.

Emefiele said that this would encourage banks to reduce the processing charges for DMBs’ deposit of lower denomination banknotes (N5 – N50) to encourage the return of unsorted banknotes to the CBN for processing.

The apex bank also intends to embark on a project that would enable mop-up of the over-circulated and mutilated banknotes from circulation. Furthermore, the CBN would continue to embark on sustainable institutional reforms and enact policies that will promote efficient currency management in Nigeria, he said. On the side-lines, Shonubi said: “The first one has to be pride of Nigerians because when people go around, they look at your currency that represents the nation.

And most of the time we show them a currency that is less than fit, it must tell on us in some shape and manner. The whole industry, not just the CBN, must be committed to changing that image.” “The document unveiled today explained how it would be done, what everybody’s role and responsibilities are and how we can make it a reality.

The banks who actually handle the notes should ensure the notes they have are always fit for purpose. We also feel it would affect commerce because people would be more inclined to spend when they have new notes in their hands and merchants more willing to accept. So we believe it would definitely help the economy and how money moves around.” On her part, the director of Currency Operations Mrs. Priscillia Ejeme, said:

“As at the end of March 2019, the CIC was 8.8 billion pieces valued N2.15 trillion. However, despite this huge volume of CIC and its attendant challenges that we are experiencing, CBN remains committed to ensuring we have fit notes in circulation.” Also alluding to the incentives for banks to bring in bad notes, she said:

“We would give a timeframe by which DMBs would need to bring all mutilated bank notes to us for replacements and we would do it in a way that they would be encouraged to bring them forward.” She also added that Automated Teller Machines (ATMs) are expected to have only mint and close to mints dispensed from which the guideline stipulates as level 1 and Level 2. While the counter banks can issue out Level 1 to Level 5 categories of notes. But Levels 6 to 9 should by rejected from collection from DMBs. On his part, the CBN director of Financial Services Provider, Dipo Fatokun, said:

“The clean note policy document provides the uniform standard of only clean and fit bank notes in Nigeria.”

Source: By MARK ITSIBOR and BUKOLA IDOWU

FG implements 79% of 2018 budget – Minister

According to a document obtained by Daily Trust from the SA to the minister of Budget and National Planning, James Akpandem,

The federal Government said its 2018 budget performance rate was 79 percent, according to a statement from spokesperson of the minister of budget, James Akpandem.

It said of the total appropriation of N9.12 trillion, N7.24 trillion had been spent by 31 December, 2018.

The statement also said that debt service and the implementation of non-debt recurrent expenditure, notably payment of workers’ salaries and pensions were on track.

While he noted capital releases only commenced after the signing of the 2018 Budget on 20 June, 2018, but as at 11th January 2019, a total of N1.226 trillion had been released for capital projects.

He said spending on capital projects has been prioritized in favour of critical ongoing infrastructural projects in the power, roads, and rail and agriculture sectors.

Source: By Latifat Opoola

FG, states, LGAs share N617.566bn for March

The Federal Account Allocation Committee (FAAC) yesterday disbursed N617.566bn as revenue for the three tiers of government for the month of March.

This represents N2.291bn shortfall from the N619.857 shared in the month of February. The communiqué issued by the Technical sub -Committee of Federation Accounts Allocation Committee (FAAC) released at the end of meeting in Abuja, indicated that the Gross statutory revenue received is N446.647 billion, which is lower than the N478.434 billion received in the previous month by N31.787 billion.

Also the revenue generated from the Value Added Tax (VAT) was N92.181 billion. This is a decrease from the N96.389 billion generated from previous mont. There was also N653 M from Exchange Gain, N13.085 billion from Forex Equalization; N55.000 billion from Good & Valuable Consideration as well as N10.000 billion added by NNPC.

These therefore, brought the total revenue distributable for the current month to the sum of N617.566 billion. Consequently, from the Net Distributable Revenue for the month, Federal Government received N257.758 billion; States received N168.254 billion; Local Government Councils received N126.575 billion, while the Oil Producing States received N49.823 billion representing 13 percent derivation of Mineral revenue.

The Cost of Collection, Transfer and FIRS Refund came up to N 15.156 billion. Furthermore, the distribution of the Value Added Tax (VAT) realized, is thus: Federal Government received N13.274 billion representing 15 percent; States received N44.247 billion representing 50 percent, while the Local Government Councils received N30.973 billion also representing 35 percent.

The communique also showed the breakdown of allocation from the the Statutory revenue generated as thus: Federal Government N208.394 billion representing 52.68%; States Government N105.700 billion, Local Government Council received N81.490 billion.

The Communique further explained that Federation Crude oil export sales increased by about 49.18 percent due to the increase in lifting volume, which resulted in increased Federation Revenue of about $240.23 million.

Also, the average crude oil price increased from $63.62 to $79.06 per barrel. The balance on Excess Crude Account is $183 million.

Source: By Chris Agabi

Here’s Proof from the Housing Market that the Economy is Slowing Faster than Expected

As the housing market continued its recovery over the last several years, home prices have risen and home maintenance and remodeling spends have risen with it.

But after a solid five-year run, it appears things are cooling off – and fast.

It’s a strong sign that the economy is slowing down, just as many analysts have predicted. But the quick change of pace may mean that it’s slowing faster than expected.

Homeowners and investors are pulling back on their housing-related spends, as the number of construction permits, home maintenance activity and remodeling expenditures all declined in March for the fifth consecutive month.

According to a recent report by BuildFax, a property condition data service provider, singly-family housing authorizations – which represent building permits requesting permission to commence construction – are down 8.4% from last year.

At the same time, home maintenance and remodeling activity is backsliding.

BuildFax data shows that maintenance volume decreased 5.07% from last year while spending remained flat, and remodeling volume declined 9.76% from last year as expenditures in this category dropped 10.07%.

“March numbers mirror an assessment from the Federal Reserve as Fed Chairman Jerome Powell warned the economy is slowing faster than expected,” BuildFax stated in its report.

BuildFax COO Jonathan Kanarek said the fact that the expectation that the Fed will not increase rates in 2019 may help alleviate some of the pressure.

“The downward trend in housing activity has led to increased focus on the sector. In March, the Fed signaled no additional rate increases in 2019, which could boost investment in the housing market,” Kanarek said. “We may see some relief across maintenance and remodeling indicators, as home sales typically facilitate investment into the existing housing stock.”

By Jessica Guerin

Senate Raises 2019 Budget by N90.3bn Despite Fiscal Challenges

The Senate on Tuesday demonstrated Nigeria’s penchant for ignoring fiscal realities as it passed the 2019 budget, raising it by over N90.3 billion to N8.916 trillion, from an earlier draft of N8.826 trillion that was submitted by President Muhammadu Buhari five months ago.

This is coming at a time the country’s revenue from oil, its major foreign exchange earner, has remained below projections, plunging 57.4 percent to $18 billion in 2018, from as high as $42.7 billion in 2014, according to data obtained from the Central Bank of Nigeria’s quarterly reports.

“The upward adjustment to the budget estimates by the legislative arm will be a source of concern to the executive given the weak fiscal position of the government,” Gbolahan Ologunro, an equity research analyst at Lagos-based CSL Stockbrokers, said.

“More importantly, it is coming at a time when debt servicing to revenue ratio is elevated, implying that there could be further increase in the level of government borrowing in the current fiscal year, with its attendant impact on further exacerbating the weak fiscal buffers of the government,” Ologunro noted.

The increase in the budget figures, according to Danjuma Goje, chairman, Senate Committee on Appropriations, arose from the provision of severance benefits for outgoing lawmakers and legislative aides, induction/orientation and the inauguration of lawmakers-elect in the Ninth Assembly, as well as more provision for security agencies to deal with unforeseen security challenges in the country.

Highlights of the 2019 budget as approved by the Senate include capital expenditure of N2.094 trillion, recurrent expenditure of N4.055 trillion, statutory transfers of N502 billion, fiscal deficit of N1.908 trillion, special intervention of N500 billion, and deficit to GDP of 1.37 percent.

A breakdown of the N2.094 trillion capital expenditure showed that Federal Ministry of Power, Works and Housing has the highest allocation of N394 billion, followed by Transportation which got N179 billion, Defence N159 billion, Agriculture N107 billion, Water Resources N92 billion, Trade and Investment N63 billion, Education N58 billion, Health N57 billion, Niger Delta N35 billion, Presidency N18 billion, among others.

The budget report also revealed that lawmakers approved the sum of N23.7 billion as severance gratuity for outgoing legislators and allowances for incoming legislators and legislative aides.

In the same token, the deficit was increased from N1.86 trillion contained in the President’s proposal to N1.908 trillion.

The Appropriations Committee adopted the Medium Term Expenditure Framework/Fiscal Strategy Paper (MTEF/FSP) with the following assumptions: 2.3 million barrels daily oil production, a benchmark oil price of $60 per barrel, and exchange rate of N305/$1.

In passing the MTEF/FSP, the Senate also approved a GDP growth rate of 3.0 percent and inflation growth rate of 9.98 percent.

While Africa’s biggest oil producer has overtime battled with closing up the fiscal deficit in its budget, it would be recalled that the 8th National Assembly, after a seven-month delay, increased the 2018 budget by 6 percent to a record N9.12 trillion from the N8.612 trillion presented by the President.

For the past four years since 2016, Nigeria has never met a revenue target specified in its budget due to fiscal expansion and so funds a larger part of it by borrowing externally.
Ologunro explained that in order to avert this brewing fiscal crisis, government will have to fashion out ways to expand revenues, particularly from non-oil sources, or embark on fiscal consolidation to improve fiscal buffers

In the 2018 budget proposal, the Buhari-led executive projected revenue of N7.16 trillion but could only achieve N4 trillion within the period, according to data obtained from the Central Bank of Nigeria’s quarterly report. This represents a shortfall of N3.16 trillion.

With total debt standing at N24.4 trillion as at 31 December, 2018, Nigeria would take about six years to offset its debt supposing it wants to pay from its current revenue stream. Nigeria currently has an interest payment to revenue of 61 percent.

Amid the problem of a shortfall in revenue, Nigeria has overtime drafted the macro-economic indicators in the budget in such a way that they are wide off the mark from realities.

For instance, the budget assumed oil projections at 2.3 million barrel per day even though crude oil production has averaged about 1.9 million barrel in the larger part of the year.

Similarly, it pegged the exchange rate at N305/$1 instead of the official market-determined rate of N360/$1. Inflation rate was also projected at double digit even though in reality it has averaged around 11.2 percent since the start of the year. Its projected GDP growth rate of 3 percent is much higher than the IMF forecast of 2.1 percent.

However, Brent crude price staying around $70 per barrel could put the oil-dependent country on a strong footing. Higher crude prices and plans to sell stakes in joint ventures with international oil companies could boost income and reduce a shortfall that has seen the government of Africa’s most-populous nation borrow more to meet its obligations. A 67 percent increase in minimum wage, together with a reluctance to cut fuel subsidies and raise consumption taxes, could see the gap widen further.

Source: By OWEDE AGBAJILEKE & MICHAEL ANI

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