Baring any last minute hitches, the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, will Tuesday transmit the 2015-2017 Medium Term Expenditure Framework (MTEF) and the Fiscal Strategy Paper (FSP) to the two chambers of the National Assembly.

In our investigations it was revealed that the documents could have been transmitted to the lawmakers yesterday, but for the National Honours' awards, which prevented President Goodluck Jonathan from signing the documents.

However, a presidency source confirmed to our press team that the president was expected to sign the document late yesterday, paving the way for its transmission today.

The MTEF and FSP are statutory documents, which articulate government’s revenue and spending plan as well as its fiscal policy objectives over a three-year period.

Section 11 of the Fiscal Responsibility Act (FRA) 2007 mandates the Minister of Finance to prepare the MTEF and FSP and lay them before the Federal Executive Council (FEC) and the National Assembly for consideration.

Going by Section 18 of the Act, the MTEF is the basis for the preparation of the annual budget.

Unlike the 2014-2016 MTEF/FSP, which were submitted a bit earlier, the 2015-2017 statutory documents are coming slightly late due to what the Director General of the Budget Office of the Federation (BoF), Dr. Bright Okogu, described as wide consultations to eliminate possible areas of friction and rancour with the National Assembly.
Explaining the delay, he told us that this was necessitated by the need to engage comprehensively with the relevant committees of both chambers of the National Assembly on the parameters of the 2015 budget, particularly the oil price benchmark.

The MTEF/FSP, he said, were approved by FEC penultimate Wednesday, which requested a few adjustments that had already been effected.

Although Okogu would not give further details on the content of the MTEF, the presidency source said the 2015 oil benchmark price might be within the range or slightly higher than the $77.50 per barrel benchmark, which was approved by the National Assembly for the 2014 budget.

Asked why the benchmark was not pegged at $70 per barrel or even lower than $70 per barrel in the face of dwindling oil prices, the source said:  “A lot depends on what oil production is in 2015, but the oil benchmark will not be a big departure from 2014.”

He said the benchmark is determined on the basis of scenario building and modelling of where oil prices might be in 2015, and expressed the hope that the National Assembly would be accommodating to the proposal from the executive.

We gathered that the reluctance to lower the oil benchmark price stemmed from increasing federal government's obligations, comprising pensions, the mounting wage bill and security, among other recurrent expenditure obligations.
Brent crude oil fell to $96.79 per barrel yesterday, moving closer to a two-year low, as weak data from major buyer China and a stronger US dollar added to pressure from heavy supply.

The international benchmark for crude has fallen from $115 in June as geopolitical tension in the Middle East failed to derail oil output, while concerns about slow demand have grown.

Although the executive and legislative arms of the government may have consulted “widely” with regards to the 2015-2017 MTEF/FSP, it is yet to be seen how the perennial areas of friction between both parties will be avoided when the National Assembly begins the actual consideration of the budget.

This is because such consultations in the past few years had done little or nothing to fasttrack the passage of annual budgets.