…It says that the lack of securitization of the loan will cost FG N1.8 trillion in interest, 40 years
The president, Major General Muhammadu Buhari (ret.), on Tuesday morning urged the National Assembly to reconsider its proposal to securitize the outstanding balance of the federal government’s ways and means at the Central Bank of Nigeria.
Failing to grant securitization approval, it warned, would cost the government around N1.8 trillion in additional interest in 2023 and a 40-year repayment period on the securitized debt.
Buhari’s appeal comes just a week after the Senate rejected his request to restructure N22.7tn’s Ways and Means advances.
The president made the call when he signed into law the N21.83 trillion Budget 2023 bill along with the Supplementary Appropriation Bill 2022.
It is the eighth and last budget of his regime.
Buhari signed the 2023 transition budget at the Council Chambers in the Presidential Village, Abuja, in the presence of Vice President Yemi Osinbajo, Senate President Ahmed Lawan, House Speaker Femi Gbajabimila and other members of the Executive Council Federal.
While urging the legislature to reconsider its position on his proposal, Buhari made it clear that he had no intention of circumventing NASS’s powers to interrogate the process.
”As I said, the balance has accumulated over several years and represents funding provided by the CBN as a lender of last resort to the government to enable it to meet obligations to lenders, as well as to cover budget shortfalls in revenue. and/or projected loans.
“I have no intention of hindering the right of the National Assembly to question the composition of this balance sheet, which can still be done even after granting the requested approval.
“However, not granting securitization approval will cost the government around N1.8 trillion in additional interest in 2023 given the spread between the applicable interest rates which is currently MPR plus 3% and the negotiated interest rate of 9%. and a term of 40 years. amortization term of the securitized debt of Ways and Means”, said the President.
He thanked the National Assembly for approving his request to extend its effective date until March 31, 2023.
The president also directed the Ministry of Finance, Budget and National Planning to work for the early publication of the 2023 capital votes to allow ministries, departments and agencies to start the implementation of their capital projects in time to support efforts to deliver key projects and public services. as well as improve the living conditions of Nigerians.
