There continues to be confusion created by opposition aligned operatives as it relates to the withdrawal of monies from the Natural Resource Fund (NRF), accountability and transparency thereof, in compliance with the Natural Resource Fund Act 2021 (hereinafter “NRF Act”). It is a very simple matter, and the withdrawals from the Fund are made in compliance with the NRF Act.
Section 16 (2) of the NRF Act establishes that:
All withdrawals from the Fund shall be deposited into the Consolidated Fund and shall be used only to finance –
- National development priorities including any initiative aimed at realizing an inclusive green economy; and
- Essential projects that are directly related to ameliorating the effect of a major natural disaster.
Section 19 (1-3) of the NRF Act sets out the procedures for the “approval of withdrawals from the Fund”, which states that:
- The amount that the Minister shall request the National Assembly to approve as the withdrawal from the Fund for the next ensuing fiscal year shall be included in the annual budget proposaland shall not exceed for that year, the ceiling calculated in accordance with Section 17 and the First Schedule plus any amount for emergency financing.
Section 20 (1) sets out the contents of the annual budget proposal, which states that the budget proposal shall include―
- An estimate of the withdrawal from the Fund for the next ensuing fiscal year and each of the next following three fiscal years;
- An estimate of the deposits into the Fund for the next ensuing fiscal year and each of the next following three fiscal years;
- A detailed estimate of petroleum revenues for the next ensuing fiscal year and each of the next following three fiscal years;
- An estimate of the expected nominal total return per annum of the Fund for the next ensuing fiscal year and each of the next following three fiscal years;
- A comparison of actual withdrawals from the Fund with the amount approved by the National Assembly for withdrawal from the Fund for the past three fiscal years.
The budget proposal comprises the budget speech and the budget estimates (Volumes 1-3). Appendix VII of the budget speech (Pg. 115) is prepared in compliance with Section 20 (1) (a-d) as outlined above.
With respect to the national development priorities set out in Section 16 (2) of the NRF Act, these are included in the budget proposal. It must also be noted that the expenditures as per Section 16 (2) of the NRF Act would comprise 100% of the capital budget, which includes, for example, the capital allocations for the infrastructure sector, health, education, and housing and water sectors, etc., more so the infrastructure sector.
Towards this end, the capital budget for 2024 amounted to $666.2 billion, accounting for 58% of the total budget. The NRF withdrawal for 2024 amounted to $240 billion, representing 36% of the total capital budget. And notably, the infrastructure budget alone for 2024 was $236 billion, 98% of the NRF withdrawal.
The table below shows a breakdown of the capital budget by sectors:
Furthermore, it must be noted that the combined opposition participates fully in the budget debates and approval process in the National Assembly, wherein the budget estimates are scrutinized in detail by the National Assembly.
The opposition chairs the Public Accounts Committee (PAC) that scrutinizes the audited public accounts prepared by the Auditor General as well.
Therefore, it is disingenuous for the opposition operatives to propagate that the government has failed to comply with the provisions of Section 16 (2) of the NRF Act, when this is done through the budget approval process, and the budget proposal includes the budget speech together with the detailed estimates of the expenditures.