In 2022, the Nigerian government allocated a total of N5.65 trillion to debt servicing, which accounted for 106% of the total revenue generated during that period, amounting to N5.30 trillion. This information is based on the 2022 FGN Budget Implementation report obtained by BusinessDay. The revenue was comprised of N3.63 trillion from the Federation Account Allocation Committee (FAAC) and N1.67 trillion from independent revenue sources.
The figures indicate a decrease from the N11.045 trillion revenue initially projected in the 2022 approved budget. In contrast, the federal government’s total expenditure for the year reached N14.63 trillion, resulting in a deficit of N9.30 trillion. This is also a reduction compared to the N21.82 trillion expenditure planned in the 2022 approved budget.
Further details of the expenditure breakdown show that statutory transfers accounted for N810.12 billion, non-debt recurrent expenditure was N5.03 trillion, capital expenditure amounted to N3.13 trillion, and N1.24 trillion was allocated to the capital development fund. Non-debt recurrent expenditure included personnel costs at N3.49 trillion, overhead costs at N371 billion, other service-wide votes at N715 billion, and CRF pensions at N387 billion.
It was previously reported by BusinessDay that the federal government utilized nearly all of its revenues generated in the first half of 2023 (99%) for debt servicing. Between January and June 2023, the government’s total retained revenue was N4.06 trillion, while N4.02 trillion was spent on servicing the national debt during the same period.
Olumide Ayodele, the technical assistant to the director-general of the Budget Office, highlighted that government revenues fell short of expectations, with a shortfall of N1.46 trillion out of the targeted N5.52 trillion for the first six months of the year. Of the N4.067 trillion retained revenue for this period, N604.1 billion came from the oil sector, while non-oil revenue amounted to N1.14 trillion. Company income tax (CIT) and value-added tax (VAT) contributed N592.68 billion and N195 billion, respectively. Customs Service collected N306.18 billion, and other revenues totaled N2.14 trillion.
Ayodele also noted that out of the N7.76 trillion actual spending for the first half of the year, N4.02 trillion was allocated to debt servicing, and N2.28 trillion was allocated to personnel costs, including pensions. Only approximately N475.98 billion had been released for capital expenditure as of June 2023.
