Nigeria: Finance Minister Clarifies Alleged N206bn Padding of Humanitarian Ministry’s Budget, Others

The Federal Ministry of Finance, Budget and National Planning has made clarification on its alleged padding of the 2023 appropriation bill, particularly the sum of N206 billion it reportedly inserted into the proposed budget of the Ministry of Humanitarian Affairs, Disaster Management and Social Development.

Humanitarian Affairs Minister, Sadiya Umar Farouq was alleged to have inserted N206,242,395,000 billion into its proposed budget for the purchase of mosquito nets under its National Social Safety Nets Project which was already being funded by the World Bank.

Speaking on the alleged budget padding, Farouq had explained that the sum was erroneously inserted.

But the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, at a meeting with the House of Representatives Committee on Appropriation, yesterday, denied the allegations, saying wrong coding was responsible as the sum was for the National Social Safety Nets Project – Scale Up (NSSNP-SU).

She said the project was correctly described in the submission from International Economic Relations Department (IERD) for the 2023 appropriation bill, but regrettably, a wrong code was inadvertently used in the process of inputting it, which resulted in it being captured as Purchase of Security Equipment in the Budget Preparation System (BPS).

She explained that the World Bank was the funding source for the project domiciled in the humanitarian ministry’s headquarters, with projected drawdown of $473,500,000, which is equivalent to N206,242,395,000, using the N435.57/$ exchange rate applicable to the 2023 proposed budget.

The minister further explained that the same project was correctly captured in the 2022 budget of the ministry in the amount of N12,304,500,000 based on the projected drawdown of $30 million at N410.15/$ 2022 budget exchange rate.

Speaking on alleged wrong insertions in the Ministry of Defence proposed budget pertaining to Refurbishment and Procurement of Harris RF-5/7800 Military Communication Equipment and Safe Schools Initiative Projects, she said, “The Minister of Defence wrote to Mr. President requesting the immediate release of $1,363,880.40 and N158,928,045.37 for the implementation of Phase 1 of the project. HM-MoD also requested the sums of $12,274,923.60 and N11,946,311,375.18 to implement Phases 2 and 3 of the project, all of which Mr. President graciously approved. “Further to Mr. President’s approval, 50 per cent of the requirement for Phases 2 & 3, amounting to N8,600,000,000 (using the exchange rate of N435.57/$), has been included in the 2023 budget proposal of the MoD.”

Also addressing allegation of insertion in the Ministry of Power’s proposed budget, she said, “The 2023 proposed budget for the FMoP includes a total of N195,465,151,790.65 MBPL with a breakdown as follows: Zungeru HydroElectric Power Project: funded by Export-Import Bank of China. Amount: $175,757,149.92, which is N76,554,541,790.65.

“Power Sector Recovery Operation (PSRO); funded by World Bank. Amount: $162,000,000, which is N70,562,340,000.00. Nigeria Electrification Project (NEP) to be executed by the Rural Electrification Agency (REA), funded by World Bank and AfDB. Amount: $55,000,000, which is N23,956,350,000.00. The Nigeria Electricity Transmission, to be executed by Transmission Company of Nigeria (TCN)): funded by the World Bank. Amount: $56,000,000, which is N24,391,920,000.000. The total projected drawdown for the four projects is $448,757,149, which is N195,465,151,790 at N435.17/$.”

Speaking about the proposed budget of the Federal Ministry of Education, the minister said, “The amount in question here relates to the 2022 budget, during which it had a projected loan drawdown of $30 million equivalent of N12,304,500,000 at an exchange rate of N410.15/$). “The issue relating to this arose from the NASS committee’s review of FME’s 2022 budget implementation. The project is the “Second Africa Higher Education Centres of Excellence for Development Impact Project” and the financier is the World Bank.

“For 2023, the amount captured for this project and the Sustainable Procurement, Environmental and Social Standard Enhancement Project is N26,134,200,000 (60 million dollars @345.57/$]; both are World Bank funded projects.”

Ahmed said the current issues would have been easily clarified between the respective MDAs and the ministry had the affected agencies followed the established budget processes.

She added that the allegation that the ministry padded the proposed budgets of the affected MDAs by inserting the projects in question made absolutely no sense.

Earlier, the lawmakers demanded the resignation of the Minister of Humanitarian Affairs and Disaster Management, Sadiya Umar Farouq, over her failure to honour repeated invitations of the House.

Farouq, who was scheduled to appear and respond to allegation of the N206 billion padding in her ministry’s 2023 budget, failed to show up.

Frowning at the development, the Chairman of the Committee on Appropriation, Hon. Aliyu Betara, said “If she is not ready for the job she should resign. Most times the committee calls the minister, she shuns the invitation.”

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