Defies 45% increase in revenue
The Federal Government recorded an 11 per cent, year-on-year, YoY increase in deficit spending to N7.88 trillion in seven months, from January to July, from N7.13 trillion in the corresponding period of 2022.
The rise in deficit spending was driven by 20.5 per cent increase in expenditure which moderated the impact of a 45 per cent increase in revenue during the seven months period, 7M’23
Vanguard analysis of the Economic Report for July released by the Central Bank of Nigeria, CBN, showed that the FG recorded revenue of N3.693 trillion in 7M’23, up by 45 per cent from N2.542 trillion in 7M’22.
Following the same trend, expenditure rose to N11.58 trillion in 7M’23 representing 20.5 per cent, You increase from N9.607 trillion recorded in 7M’22.
But in July, the FG recorded a 5.3 per cent, month-on-month, decline in deficit spending owing to delay in releases for capital expenditure.
The CBN said, “The FGN retained revenue (provisional) rose, due to higher receipts from FGN Independent Revenue, and Exchange gain. At N564.13 billion, FGN retained revenue in July 2023 was 57.1 per cent, above collections in June 2023, but fell below the monthly target of N920.43 billion.
“The Provisional aggregate expenditure of the FGN increased in July 2023, relative to June 2023, but fell short of the target. At N1,380.66 billion in July 2023, the provisional FGN expenditure was N159.01 billion (13.0%) above the level in June 2023 but was below the target by N438.27 billion (24.1%). Recurrent expenditure at 74.2 per cent, maintained its dominance in total FGN spending, while capital outlay and transfers accounted for 20.8 and 5.0 per cent, respectively.
“The estimated overall fiscal deficit of the FGN contracted, relative to the level in June 2023. Provisional fiscal deficit of the FGN, at N816.53 billion, contracted by 5.3 per cent, relative to the level in the preceding month, and was 9.1 per cent below the proportionate budget threshold. The contraction reflected lags in capital releases in the face of improved revenue outturns.”
VANGUARD
