The Federal Government recorded deficit expenditure by 11% year on year, from January to July, reaching N7.88 trillion, up from N7.13 trillion in the same time in 2022.
The increase in deficit spending was driven by a 20.5 percent increase in expenditure, which mitigated the impact of a 45 percent gain in revenue over the seven months, 7M’23.
According to a report, the Central Bank of Nigeria’s (CBN) Economic Report for July, the FG generated income of N3.693 trillion in 7M’23, up 45 percent from N2.542 trillion in 7M’22.
Following a similar pattern, expenditure increased by 20.5 percent to N11.58 trillion in 7M’23, up from N9.607 trillion in 7M’22.
However, the FG recorded a 5.3 percent month-on-month reduction in deficit spending in July due to capital expenditure release delays.
According to the CBN:
“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.”
cc: Vanguard Ng
