The Federal Government is set to audit the operations of all revenue generating agencies and parastatals in the country with the objective of raising more revenue to fund the over N1trillion deficit in the 2012 budget announced by President Goodluck Jonathan on Tuesday.

Minister of Finance and Coordinating Minister for the Economy, Ngozi Okonjo-Iweala, who announced this today in Abuja while presenting the analysis of the budget to the media, said the government also hopes to finance the deficit through domestic borrowing and proceeds from the privatization programmes as well as signature bonuses  from award of oil block leases.

“We will be auditing the revenue generating agencies and parastatals one by one, to generate more resources for the budget. They have already been given letters to this effect. About N170billion is still outstanding in the form of corporate taxes that government needs to collect. Government is currently negotiating agreements with organizations that have issues, on how to get the money remitted to government,” the minister said.

Although government aims to maintain a domestic debt-to-GDP (gross domestic product) ratio of 16.4 percent during the year, the minister said steps would be taken to ensure that domestic borrowing and debt profile was sustainable, by ensuring that the level of borrowing comes down from N852billion in 2011 to about N794billion next year.

Reviewing the performance of the 2011budget, Mrs. Okonjo-Iweala noted its implementation was “at a reasonable pace given the circumstances it faced, including the late passage of the 2011 amendment bill in May 2011 and the shortage of time.

She put the implementation  level at about 60 percent , with the release of about N830billion out of the about N1.146trillion provision for capital budget, adding that by the time the whole amount is released, at least 70 percent execution rate would have been achieved.

“The implementation of most of the programmes underlining the transformation agenda of the present administration as captured in the 2012 budget have already begun on both the macro- economic, structural and the real sectors of the economy where investments are being made. These can be seen in security, agriculture, infrastructure development, power sector.

“2012 will point in a new direction of where the economy is going, in terms of the pace of growth in the economy, to make it more inclusive and capable of creating jobs for the youth of this country. Government is going to move the recurrent expenditure level and changing the structure of the budget steadily down to about 67-68% level that it was about six years ago.

“In the same vein, we have started increasing the capital budget, beginning with 28% this year. We hope to take it up to a third of the total budget by 2015. We are reversing the declining trend of capital and increasing recurrent expenditure, and taking them back to more reasonable figures,” she said.

The Minister declared that at the end of the financial year on December 31, 2011, all allocations to ministries, departments and agencies (MDAs) not utilized would be returned to the coffers of government in line with global best practice and principles.

The focus of government during the year, she pointed out, will be on reducing waste and increasing efficiency within the system to cut down on recurrent expenditure, adding that the biometrics scheme in some of the MDAs had recorded tremendous results in terms weeding out ghost pensioners and workers and bring down the wage bills.

She drew attention to the effort of the task force from the Office of Head of Service of the Federation in collaboration with the Police Pensions office, which resulted in the scaling down of the Police Pension paid from over N1.5billion to about N500million, adding that government is determined to sustain the scheme to block all leakages in the entire system.

“Government is not looking at only the expenditure side of the budget and a manageable fiscal deficit of 2.77% of GDP, but also the revenue side and taking measures to improve the internally revenue collection and corporate tax collection as well as block revenue leakages within the system

“Government is restructuring agencies with overlapping functions. A task force has already been set up to review government parastatals with duplicating functions to cut down on the recurrent expenditures. Government will also look at the many commissions and committees to see whether their mandates are still relevant and valid.

“We have to work to diversify the country’s economic base by implementing the programmes government set out in agriculture to help reduce the level of food imports and promotion of exports. Government is putting in place the institutions that will help in the implementation of the programmes” she said.

On ongoing capital projects, she said government will give priority attention to the completion of more than 6000 projects at various locations across the country pointing out that government plans to develop a template for the implementation of projects approved for execution to ensure that they have financial sustainability and job creation potentials.

She said measures have been taken to support agriculture, including interest-free importation of machines and tools and incentives as well as specific disincentives for certain crops adding that apart from building institutions in the power sector to encourage more investments, government will continue to support those youths with entrepreneurial ideas through the U-Win programme to create jobs.

So far, she said the first phase of the programme had identified 6000 beneficiaries, who are currently undergoing training, out of which about 1200 finalists would be selected for government’s support to set up various job creation ventures.