FG Records ₦5.33tn Deficit In Eight Months – Finance Minister Confirms

Nigeria’s Minister of Finance, Budget and National Planning, Zainab Ahmed has shared details of the nation’s financial record between January and August 2022.

Speaking at the ministerial presentation of the 2023 budget in Abuja yesterday, the minister said Nigeria in the period under review recorded a deficit of ₦5.33tn, amounting to ₦430.82bn above the prorate level.

According to her, the government spent ₦9.56tn from January to August 2022, out of ₦11.55tn pro rata expenditure projected for the period. Of the ₦9.56tn spent in eight months, ₦3.52tn was expended on debt service while ₦2.89tn was used for personnel costs and pensions.

While recalling that the total expenditure projected for the whole of 2022 is ₦17.32tn, the minister noted that the federal government’s retained revenue as of August 2022 was ₦4.23 trillion, representing 64 per cent of the pro-rata target of ₦6.65tn.

She disclosed that the Federal Government’s share of oil revenues in 2022 was ₦395.06bn, representing 27.1 per cent performance, while non-oil tax revenues totalled ₦1,549.91tn, indicating 102.9 per cent performance.

Ahmed further revealed that the Companies Income Tax and the Value Added Tax collections this year totalled ₦826.27bn and ₦210.36bn respectively, representing 136.3 per cent and 99.6 per cent of their respective targets.

Customs’ collections comprising import and excise duties, fees, and federation account special levies fell short of the target by ₦102.51bn a (17 per cent).

“The Customs introduced that thing and it has created a lot of revenue setbacks for the government. The government should look at it seriously and reduce it and cancel the VIN. It is illegal and should be cancelled,” the founder of the National Council of Managing Directors of Licensed Customs Agents, Lucky Amiwero told The Punch in an interview recently.

Speaking further, Ahmed said the key parameters and other macroeconomic projections driving the medium-term revenue and expenditure framework had been revised in line with the emergent realities, including the GDP growth (from 4.20 to 3.55 per cent in 2022 forecast).

For the 2023 budget, she said investment, especially from foreign sources, was expected to be hit by interest rate hikes in advanced economies, foreign exchange management concerns in Nigeria and other domestic challenges, including insecurity.

“Overall budget deficit is ₦10.78tn for 2023. This represents 4.78% of GDP,” Ahmed said, noting that budget deficit would be financed mainly by borrowings from domestic sources (N7.04tn); foreign sources (N1.76tn); multilateral /bi-lateral loan drawdowns (N1.77bn), and privatisation proceeds (N206.18bn).