Nigeria News
No hasty embrace of austerity measures –Reps

The House of Representatives said on Monday that lawmakers would not be in a haste to embrace the new austerity measures rolled out by the Federal Government on Sunday.

“Packaging and implementation are two different things entirely. This is a theory that looks fanciful; so it is hasty to embrace the measures,” House spokesman, Zakari Mohammed, told The PUNCH on Monday.

Mohammed noted that past experiences with policies of government had shown that the excitement would soon die down following the implementation, “which tends to derail from the initial objectives.”

He stated that, for now, lawmakers would be studying the measures just like every other Nigerian until they reconvene on December 3.

“No matter how excited some people may be over these measures, we have to sit down and discuss them exhaustively.That cannot happen until we reconvene,” Mohammed stressed.

He cited the government’s plan to review the 2015-2017 Medium Term Expenditure Framework as one issue that would normally be “thoroughly debated” by the House before taking a position.

The MTEF is already before the National Assembly.

The government had initially proposed $78 as the crude oil benchmark for the 2015 budget but the Minister of Finance, Dr. Ngozi Okonjo-Iweala, said, as part of new the new measures announced in Abuja, the benchmark would be slashed to $73.

She explained that the decision was to provide a safe zone for the country’s oil returns in view of the crumbling prices of crude.

Besides the slash in the benchmark, the minister announced that government would cut spending on travels by its officials. It also introduced taxes on luxury goods and services.

She explained that exotic cars, particularly Sport Utility Vehicles, yachts and alcoholic beverages, among others, would attract high taxes in the days ahead to generate revenue for government.

While Mohammed spoke as the Chairman, House Committee on Media and Public Affairs, his counterpart who chairs the Committee on Finance, Mr. Abdulmumin Jibrin, last week, expressed the same fears as raised by Okonjo-Iweala.

Jibrin had hinted on a possibility of returning the MTEF to the Executive, owing to emerging economic realities.

Deputy House Leader, Mr. Leo Ogor, observed that the luxury tax might be a way to get the rich to pay for the free things they enjoyed in the country.

He said the rich in Nigeria did not pay tax, a situation he described as “very embarrassing.”

Ogor said, “The rich are the ones enjoying in this country today. So, there is nothing bad in asking them to pay more to assist the masses.

“The rich here don’t pay tax, which is very embarrassing.

“All over the world, tax policies are heavier on the rich because they are the ones enjoying all the services.

“Therefore, reducing the crude oil benchmark and paying tax on luxury goods are measures to bring the economy in line with the present realities we face as a country.”

The crude oil benchmark has frequently caused a row between the executive and the National Assembly.

Last year, the two sides dragged the issue for months before they finally settled at $77.5 per barrel.

The initial presidential proposal for the 2014 budget was $74. The Senate passed $76.5 while the House jacked it up to $79.

The two houses later agreed on $77.5 after many weeks of delay before passing the budget.

It will be recalled that the executive grudgingly accepted the new figure, as it feared that a crash in oil price could make implementing the budget impossible.

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