The Federal Government (FG deficit spending in 2021 jumped to N7.3 from N5.9 trillion. This is an increase of about 23.7 percent, Year on year (YoY,).
Central Bank of Nigeria, CBN, disclosed this in its fourth-quarter 2021 (Q4’21) Statistical Bulletin report.
According to the Statistical Bulletin released by the CBN stated that the increase of 23 percent in the government’s deficit spending was caused by a 17.4 percent increase in expenditure which subdued the 9.2 percent trillion recorded in 2020.
Government’s total revenue for 2021 rose to N4.39 trillion in 2021, from N4.02 trillion recorded in 2020, representing a 9.2 percent rise.
On the other hand, total expenditure rose to N11.69 trillion in 2021, from N9.95 trillion in 2020, representing 17.4 percent.
The bulletin stated that in the first quarter, Q1’21, the Federal Government recorded N914.8 billion in revenue and N2.89 trillion in expenditure, resulting in a N1.97 trillion deficit.
Also in the fourth quarter, Q4’21, the government recorded N1.2 trillion revenue and N2.9 trillion in expenditure, resulting in a N1.69 trillion deficit.
Given the reason why the fiscal activities in Q4’21 were so, the CBN explained that the government retained revenue declined due to shortfalls in the receipt from federation account sources.
At N1.26 trillion, the provisional retained revenue of the government declined by 36.6 percent and 3.2 percent, relative to the budget benchmark and the preceding quarter, respectively, reflecting the subsisting revenue challenge over the past two years.
On expenditure, it explained that the decline in provisional capital expenditure triggered an 8.8 percent drop in aggregate spending in the fourth quarter of 2021, relative to the preceding quarter.
“A disaggregated analysis revealed that recurrent expenditure rose by 5.6 percent, relative to the preceding quarter, while capital expenditure dropped by 61.3 percent, over the same period. “Recurrent spending maintained its dominance, accounting for 75.1 percent; while capital expenditure and transfers constituted the balance of 21.3 percent and 3.6 percent, respectively.
“Aggregate expenditure fell faster than revenue, thus tapering the provisional deficit. At N2.23 trillion, the provisional fiscal deficit of the FGN was 12.0 percent lower than the level in the preceding quarter.”
olusola Bello
