ABUJA (Reuters) - Nigerian lawmakers on Tuesday approved a planned bond issue to fund an 88 billion naira budget for the electoral commission to overhaul voter lists and buy more ballot boxes ahead of January polls.
Presidential and parliamentary elections are due to be held in Africa's most populous nation in less than six months, but the electoral register is in dire need of being updated.
"The request for additional funds is to cover the cost of procuring electronic equipment and other ancillary expenses related to ... a fresh voter registration exercise as well as the procurement of additional ballot boxes," President Goodluck Jonathan said in a submission to parliament.
"We propose to fund this request by raising federal government bonds," he wrote in the submission, which was approved by lawmakers.
The House of Representatives is expected to approve the 87.72 billion naira budget for the Independent National Electoral Commission (INEC) on Wednesday.
Government spending was already set to rise sharply this year. Parliament earlier this year approved 445 billion naira in extra spending that includes pay rises for civil servants, doctors and professors.
That supplementary spending plans comes on top of the main 4.4 trillion naira 2010 budget, meaning Nigeria's fiscal deficit is expected to increase beyond 5.4 percent of GDP, well above a 3 percent target set just three years ago.
The finance ministry has warned that government revenues, mostly from oil sales, would not be enough to fund the budget and that the OPEC member would likely have to use up its windfall oil savings or borrow more.
Parliament last month passed a constitutional amendment bringing elections forward to January, leaving little time for reforms needed to avoid a repeat of chaotic 2007 polls.
An electoral roll riddled with fictitious names and omitting legitimate voters was one of the main problems at the 2007 polls, which were so marred by ballot stuffing and intimidation that observers deemed them not to have been credible.
INEC has said the spending plan was largely for the purchase of 120,000 electronic voter registration machines, including laptop computers, finger print scanners, cameras and printers to issue voter cards.
Nigeria's debt market is deepening but is still dominated by government bonds, which make up some 95 percent of the market. The government recently cut transaction costs and removed taxes on bond issuance, lowering the cost of borrowing.
Sub-Saharan Africa's second-biggest economy issues sovereign bonds every month as part of measures to restructure its short-term treasury bills to long-dated instruments, to manage liquidity and help curb inflationary pressure.