Nigeria’s total expenditure in January exceeded its expenditure, leaving a revenue gap or fiscal deficit of N485.51billion, according to Central Bank of Nigeria’s (CBN) latest report.
According to the monthly economic report for January released by the CBN on Friday, the budget deficit of N485.51 billion, was 17.1 per cent and 11.5 per cent higher than the target budget deficit and the level in January 2020.
The apex bank attributed this increase in fiscal deficit largely to the rollover and release of outstanding (capital) allocations to the Ministries Departments and Agencies (MDAs) in the 2020 budget, which pushed up aggregate expenditure.
It however said the disbursement would not cause liquidity risks, as it had already been accommodated in the financial programme of the government in the 2020 fiscal year
The financial regulator explained that the low revenue performance in January was due to the decline in non-oil receipts following the lingering effects of the COVID-19 pandemic on business activities and the resultant shortfall in tax revenues.
The CBN report read in part, “Federally collected revenue in January 2021 was N807.54 billion.
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“This was 4.6 per cent below the provisional budget benchmark and 12.8 per cent lower than the collection in the corresponding period of 2020.
“Oil and non-oil revenue constituted 45.4 per cent and 54.6 per cent of the total collection respectively. The modest rebound in crude oil prices in the preceding three months enhanced the contribution of oil revenue to total revenue, relative to the budget benchmark.
“Non-oil revenue sources underperformed, owing to the shortfalls in collections from VAT, corporate tax, and FGN independent revenue sources.
“Retained revenue of the Federal Government of Nigeria was lower-than-trend due to the lingering effects of the COVID-19 pandemic.
“At N285.26bn, FGN’s retained revenue fell short of its programmed benchmark and collections in January 2020, by 41.3 per cent and 7.5 per cent respectively.
“In contrast, the provisional aggregate expenditure of the FGN rose from N717.6bn in December 2020 to N770.77bn in the reporting period, but remained 14.4 per cent below the monthly target of N900.88bn.
“Fiscal operations of the FGN in January 2021 resulted in a tentative overall deficit of N485.51bn.”
The report said that total public debt outstanding of the FGN as of the end-September 2020, stood at N28.03tn, with domestic and external debts accounting for 56.5 per cent and 43.5 per cent, respectively.
According to the report, the continued spread of the COVID–19 pandemic weakened global economic recovery and led to a decline in foreign exchange inflow into the economy in the month under review.
