President Bola Tinubu on Monday signed into law the N2.2tn supplementary budget for 2023 which will now run alongside the 2024 budget until March 31, 2024.
Monday’s development comes nine weeks after the Federal Executive Council approved additional spending for defense, works, and welfare packages such as wage awards and conditional cash transfers agreed with the Organised Labour in early October 2023.
Tinubu also “securitized” the Ways and Means, a credit facility financed by Nigeria’s Central Bank that waxed infamous in the twilight of the Buhari administration.
The Speaker of the House of Representatives, Tajudeen Abbas, revealed these when he addressed State House Correspondents at the Aso Rock Villa shortly after Tinubu signed the 2024 budget into law.
Abbas explained, “Mr. President has signed two other bills. The first one is the supplementary appropriation bill of 2023, which he has agreed to extend by 90 days. So, it will continue to work concurrently with the 2024 budget up to March 31.
“He has also approved the 2023 main budget to concurrently operate with the capital component of the 2024 budget up to March 31, 2024.
“Another landmark achievement we had was also approving the securitisation of the ways and means that have effectively brought to an end these controversial means and ways of borrowing money. And he has assured Nigerians that this will be the last of this kind of ugly incident.”
First used in the Parliament of England, the term “ways and means” refers to the provision of revenue to meet national expenditure requirements and implement economic policy objectives.
Ways and means allow CBN to provide short-term financing to the government to cover budget shortfalls or meet short-term needs and emergencies.
The CBN Act states that “ways and means” must not exceed 5 percent of revenue for the previous fiscal year.
Section 38(2) & (3) states “that Ways and Means shall not exceed 5% of the previous year’s revenue of the Federal Government.”
However, The PUNCH reports that in May 2023, the Senate increased the government’s borrowing limit from five to 15 percent. It explained that the increase was necessary to help the Buhari-led government meet its financial obligations.
Experts argue that the government has used Ways and Means to increase its budget expenditure without realistic revenue projections. This has prevented the government from setting priorities and rationalising expenditures.
Also speaking on the matter, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the administration is ready to phase out Ways and Means.
He said, “We are all ready, even from tomorrow, applying technology to ensure that the revenue that should come to government from all sources, including from government-owned enterprises, comes into the consolidated revenue fund and on the other side, we are bringing order to government borrowing
“So, Ways and Means is being eliminated by taking the funding that is required from the market, as opposed to the printing of money by Central Bank.”
Earlier, President Tinubu signed the N28.7tn 2024 budget after he arrived in Abuja from Lagos, where he observed the Christmas holidays.
Other senior government officials present at the brief ceremony include Chief of Staff to the President, Femi Gbajabiamila; Minister of Budget and Economic Planning, Senator Atiku Bagudu, and National Security Adviser, Nuhu Ribadu.