The Federal Government (FG) has reported a N12.95 trillion budget deficit for 2024, representing a 41 percent increase compared to the N9.16 trillion deficit projected for the year. According to data from the Central Bank of Nigeria (CBN) Quarterly Economic Reports for 2024, the deficit also rose slightly by 0.77 percent Year-on-Year (YoY) when compared to the N12.85 trillion deficit recorded in 2023.
A deeper breakdown of the figures reveals that government expenditure in 2024 stood at N21.5 trillion, which marks a 12 percent YoY increase from N19.19 trillion in 2023. However, the expenditure is still 25.2 percent lower than the N28.76 trillion initially budgeted for 2024. On the revenue side, the FG’s earnings grew by 34.8 percent YoY, reaching N8.55 trillion in 2024, up from N6.34 trillion in 2023. Despite this growth, revenue fell short of the 2024 target by 56 percent, with the government aiming for N19.56 trillion.
The CBN’s fourth-quarter economic report highlighted a 2.22 percent increase in government expenditure in the fourth quarter, totaling N5.6 trillion. This increase was attributed to higher personnel costs and interest payments, which surged by 23.31 percent and 6.98 percent, respectively. Despite the rise in expenditures, it was still 22.09 percent below the quarterly target of N7.19 trillion.
A breakdown of the total expenditure showed that recurrent spending accounted for the largest share, at 75.13 percent, while capital outlays and transfer payments received 17.1 percent and 7.77 percent, respectively.
On the revenue front, the CBN noted a positive trend in the government’s retained revenue, which rose due to increased receipts from the Federation Account, non-oil revenues, and the government’s independent revenue sources. However, provisional retained revenue for the fourth quarter was still 48.57 percent below the benchmark.
In terms of deficit management, the CBN reported a narrowing of the primary deficit by 22.62 percent compared to the previous quarter. Overall, the fiscal deficit for the fourth quarter reduced by 3.61 percent to N3.08 trillion, reflecting an improved balance from a higher revenue increase that outpaced expenditure growth.
These figures highlight the ongoing fiscal challenges faced by the government, despite efforts to improve revenue generation and control expenditure.
