The Minister of Finance, Mrs. Kemi Adeosun, on Sunday said that between 2016 and 2017, the Federal Government was able to save the sum of N125bn through a reduction in travel allowances, sitting allowances and other recurrent expenditure such as office stationery.
She said the amount was saved through the activities of the Efficiency Unit, which was set up by the ministry to reduce the cost of governance.
The unit had issued circulars to Ministries, Departments and Agencies of government, advising them to take advantage of the quantity discount of between five per cent and 50 per cent when booking for air tickets.
This is expected to reduce the amount spent on overhead by the government.
Giving a breakdown of the amount, the minister stated that the sum of N91bn was saved from the reduction in travel allowances between 2016 and 2017, while the balance of N34bn was saved from office stationeries.
A further breakdown of the N91bn for travel allowances showed that the government saved N34bn in 2016, while the 2017 fiscal period had N57bn.
For office stationery, Adeosun said the sum of N24bn was saved in 2016, while the 2017 fiscal period had N10bn.
Adeosun stated, “The Efficiency Unit has embarked on several cost-cutting initiatives that have influenced the issuance of circulars to all the MDAs by the Secretary to the Government of the Federation, the Head of the Civil Service of the Federation, and the National Salaries, Wages and Income Commission.
“The issuance of these circulars has led to better management of certain recurring processes and activities relating to travels, sitting allowances, souvenirs and others, resulting in savings.
“The government has saved N34bn on travel and transport for 2016 compared to 2015 figures, and a further N57bn on same travel and transport in 2017 compared to 2016. Again, on office stationery and computer consumables, the government saved N24bn in 2016 as against the previous year and a further N10bn in 2017 compared to the 2016 expenditure on the same line item.”
On the fears expressed by the International Monetary Fund about the ability of the government to repay the country’s N21.7tn debt, the minister maintained that there was no cause for alarm, adding that the nation’s debt was still sustainable.
Adeosun said the government was not worried about the country’s rising debt as the debt to Gross Domestic Product ratio was still low compared to other countries.
For instance, she noted that compared to Nigeria’s debt to GDP ratio of 20 per cent, Ghana’s was at 68 per cent; Ethiopia, 50 per cent; and China, 250 per cent.
The minister added that unlike the previous government that borrowed to pay salaries, the focus of the administration of President Muhammadu Buhari was to invest massively in infrastructure.
She said as of the time that the Buhari administration took over in 2015, oil prices were very low and as such the government was constrained in allocating funds for capital projects without having to source for loans.