Oil theft, pipeline vandalism may mar 2013 budget - Okonjo-Iweala

OIL theft, pipeline vandalism and intense competition from newly emergent oil producing countries in Africa are some of the factors that may hamper the oil revenue projection in the 2013 budget. The Coordinating Minister for the economy and the Minister of Finance, Dr Ngozi Okonjo-Iweala and the Director General, Budget Office, Dr Bright Okogu made this revelation Thursday in Abuja at a press briefing on the 2013 budget recently signed into law by President Goodluck Jonathan.

The minister, giving an overview of the 2013 budget stated that the country remained vulnerable to shocks as a result of external and internal shocks in the Nigeria oil Industry.

Highlighting some of the factors that may hamper the country’s oil revenue projection, the minister stated that some African countries such as Ghana, Liberia Cote d’ivoire and Uganda that normally buy the Nigeria crude oil are now oil producing countries while the United States of America is now self sufficient in oil and would no longer have the need to import oil from Nigeria.

Besides this, the Coordinating Minister for the economy also stated that oil theft and pipeline vandalisation were capable of making nonsense of the oil production projection of 2.63million barrels per day.

The Director General of the Budget Office, Dr Bright Okogu, who also affirmed threat to oil earnings in 2013 stated that widening oil supply-demand gap for crude oil in Nigeria has negative implications on sales, stressing that the government had already taken steps to foreclose any negative effects the low demand for Nigerian oil can have on the economy.

The mitigating measures as announced by Dr Okonjo-Iweala included the reduction in the cost of governance and the restructuring of the budget in favour of capital expenditure with a view to generating growth and development.

Another measure was the need to increase Internally Generated Revenue in the 2013 budget.

To this end, a riot act has been read to all revenue generating agencies like the Nigeria National Petroleum Corporation, the Nigeria Customs Service and the Federal Inland Revenue Service to ensure proper remittance of all revenues collected on behalf of the government by the agencies.

Dr Okonu, who identified non full remittance of revenue collected by the agencies by the Chief Executive Officers of such agencies as a factor that would affect the revenue profile in the 2013 budget said the government has , beginning with the 2013 fiscal year adopted a zero tolerance for non full remittance of federal government revenue by the agencies .

To ensure that agencies comply with full remittance directive, the DG Budget said the government would hold session with CEOs of all revenue collection agencies to drum it into their hears the need to ensure full remittances.

Dr Okonjo-Iweala also stated that the government would support the Federal Inland Revenue Service this year to embark on further reforms such as improving audit checks and increasing control on exemptions.TK's Blog | Free Forex Signals | Infotech Arena Tech News |