8th October, 2021
By Folasade Akpan
Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said has disclosed that the government has expended N2,87 trillion on debt servicing in 2021.
She also sai the Federal Government generated N3.93 trillion, being 73% of its targeted N7.9 trillion revenue for 2021.
She disclosed on Friday in Abuja, at the Public Presentation and Breakdown of the Federal Government 2022 Appropriation Bill.
President Muhammadu Buhari had on Thursday presented the N16.39 trillion 2022 Appropriation Bill to a joint session of the National Assembly in Abuja.
According to Buhari, total revenue available to fund the 2022 Federal Budget is estimated at N10.13 trillion, including grants and aid of N63.38 billion, as well as the revenues of 63 Government-Owned Enterprises (GOEs).
Described as a budget of Economic Growth and Sustainability, it was predicated on a conservative oil price benchmark of US$ 57 per barrel with a daily oil production estimate at 1.88 million barrels per day.
The minister said the exchange rate of N410.15 per US dollar and projected Gross Domestic Product (GDP) growth rate of 4.2 per cent and 13 per cent inflation rate, were also taken into consideration.
Ahmed said that of the generated revenue for 2021, the Federal Government’s share of oil revenues was N754.2 billion, representing 56.3 per cent of the performance of the prorated sum.
She added that non-oil taxes revenues stood at N1.15 trillion, representing 115.7 per cent, which was above what was targeted in the 2021 budget.
On the expenditure side, the minister said that N8.14 trillion had been spent out of the N9.71 trillion pro-rata budget, adding that it was inclusive of expenditure estimates of Government-Owned Enterprises (GOEs), but excluded project-tied loans.
Giving a breakdown of the expenditure, Ahmed said that N2.87 trillion had been expended on debt service and N2.57 trillion for personnel cost, including pensions, while N1.79 trillion had been expended on capital projects.
Speaking on the 2022 Appropriation Bill, Ahmed said that the N16.39 trillion proposed to be spent was 12.2 per cent higher than the initial 2022 Medium Term Expenditure Framework (MTEF).
She said that of the amount, N10.132 trillion was projected to be generated as revenue and N6.26 trillion which was 3.39 per cent of GDP as deficit would be financed majorly by borrowing.
To fund the deficit, N2.51 trillion would come from domestic sources, another N2.51 trillion from foreign borrowing, N1.16 trillion from multi- and bi-lateral loan drawdowns and N90.7 billion from privatization proceeds.
For the revenue, she said that N3.53 trillion would come from oil, N2.13 trillion from taxes, N1.816 trillion from independent revenue, N1.728 trillion from retained GOEs and N924.31 billion from other revenue sources.
On expenditure, she said that recurrent expenditure, which is non-debt spending, was estimated to cost N6.83 trillion, while aggregate capital expenditure was pegged at N5.35 trillion and N3.61 trillion would go for debt servicing, while N292.7 billion would provide for the retirement of maturing bonds to local contractors and suppliers.
Speaking on critical sectoral allocations, Ahmed said that the defence and security sector, at 15 per cent, would get N2.41 trillion, infrastructure at 8.9 per cent N1.45 trillion and the education sector at 7.9 per cent of the budget at N1.290 trillion.
For the health sector, 5 per cent of the total budget at N820.2 billion and social development and poverty reduction programmes at 5.3 per cent of the budget would get N863 billion.
However, Ahmed said that the 2022 budget was expected to further accelerate the recovery of the nation’s economy.
“We are optimistic of attaining more inclusive GDP growth as we focus on achieving our objective of massive job creation and lifting millions of our citizens out of poverty.
“Early passage of the 2022 budget for implementation from January 1 will significantly contribute towards achieving government macro-fiscal and sectoral objectives.”
Meanwhile, she said that though revenue currently remains the nation’s fiscal challenge, the government remained committed to the effective implementation of the Strategic Revenue Growth Initiatives (SRGI).