Despite the implementation of the Strategic Revenue Growth Initiatives by the Ministry of Finance aimed at shoring up revenue, the Federal Government still recorded a whopping amount of N5.33trn as fiscal deficit in the first eight months of this year.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed revealed the deficit on Wednesday in Abuja at the ministerial presentation of the 2023 budget proposal.
A fiscal deficit occurs when a government’s total expenditure exceeds the revenue that it generates, excluding borrowings.
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The Strategic Revenue Growth Initiative was launched in 2020 by the Federal Government for identifying and exploiting sources that would largely boost and diversify the revenue base of the country.
The key thematic areas covered by the SRGI are achieving sustainability in revenue generation, identifying new and enhancing the enforcement of existing revenue streams, as well as achieving cohesion in the revenue ecosystem (people and tools).
But despite the initiative, as of a
August 2022, she said the Federal Government’s retained revenue was N4.23trn, which is 64 per cent of the pro-rata target of N6.65trn.
She said, “The fiscal deficit for 2022 is estimated at N7.53trn. The N5.33trn deficit as at August is N430.82bn above the prorate level.
“The level of borrowing is at N1.26trn ahead of August target.
“The FGN share of oil revenue was N395.06bn representing 27.1 per cent performance, while non-oil tax revenue totaled N1.549trn a performance of 102.9 per cent.
“CIT and VAT collections were N826.27bn and N210.36bn representing 136.3 per cent and 99.6 per cent of their respective targets.
“Customs collections comprised of imports duties, excise and fees, and federal account special levies, trailed the target by N102.51bn (17 per cent).
“Other revenues accounted by N2.19trn of which independent revenue was N866.16bn.”
In terms of expenditure, she put the
aggregate expenditure for 2022 at N17.32trn with a pro-rata spending target of N11.55trn at the end of August.
The actual spending, as of August 31 was N9.56trn and of this amount, N3.52trn was for debt service and N2.89trn for personal costs including pensions.
In addition, the Minister stated that N1.78bn was released for capital expenditure.