The Socio-Economic Rights and Accountability Project (SERAP) has asked President Muhammadu Buhari to desist from his plan to take another loan to finance 2022 budget.
SERAP stated that it will ensure that the Nigerian government drops indiscriminate borrowing, end corruption, and cut the cost of the governance.
The group disclosed this on its official Twitter page on Thursday morning.
The Nigerian Government on Wednesday revealed plans to finance the proposed 2022 budget deficit pegged at N6.258 trillion through new borrowings.
Minister of Finance, Budget, and National Planning, Zainab Ahmed, disclosed this during a press conference after the Federal Executive Council (FEC) meeting in Abuja, adding that the loan will help fund infrastructural projects at the federal level.
“Government has been borrowing before this administration and continues to borrow and it is important that we borrow to provide developmental projects in the form of roads, rails, bridges, power, and water for sustainable development in this country,” she said.
“If we just depend on the revenues that we get, even though our revenues have increased, the operational expenditure of government, including salaries and other overheads, is barely covered or swallowed up by the revenue.”
While defending the government’s borrowings, she said the decision is necessary to be able to construct projects and ensure they are developed on a sustainable basis.
Despite public criticism against the frequent borrowings by Buhari's government, the Finance Minister insisted that the total size of the borrowing is still within healthy and sustainable limits.
Ahmed added, “Nigeria’s borrowing, has been of great concern and has elicited a lot of discussions. But if you look at the total size of the borrowing, it is still within healthy and sustainable limits.
“As of July 2021, the total borrowing is 23% of GDP. When you compare our borrowing to other countries, we’re the lowest within the region, lowest compared to Egypt, South Africa, Brazil, Mexico, the very lowest, and Angola.
“We do have a problem with revenue. Our revenues have been increasing. We just reported to Council that our revenues from non-oil have performed, as of July, at the rate of 111%, which means outperforming the prorated budget.”
This comes as the Federal Executive Council (FEC) approved the 2022 Appropriation Bill for an aggregate expenditure of N16.39 trillion.
Reacting to the intention of the Nigerian government to take another loan, SERAP asked Buhari to drop the idea immediately.
"BREAKING: N35trn debt: We urge President Buhari to immediately drop the reported plan to borrow to finance N6.258 trn 2022 proposed budget deficit.
"We’ll fight to push the administration to stop this indiscriminate borrowing, end corruption and cut the cost of governance," SERAP tweeted.