RipplesMetrics: Key numbers of 2023 budget, as debt servicing takes 100% of oil and non-oil revenue (PT1)

Another year, another budget exercise which is raising many more questions than answers.

For the eighth and final time, President Muhammadu Buhari submitted Nigeria’s budget to federal legislators.

The 2023 budget, termed the Budget of Fiscal Consolidation and Transition, is a N20.50 trillion document, up from the N17.12 trillion budget for 2022.

Ripples Nigeria provides you with key breakdown from the document.

Budget deficit

The Federal Government is expecting to incur fiscal deficit of N10.78 trillion.

The deficit for 2023 represents a 72.20 percent increase when compared to the deficit of N6.26 trillion in 2022 budget.

Just like in previous years, the deficit will be financed mostly through borrowing, sale of national assets.

N8.80 trillion of the deficit will be cover by debt financing while asset sales / privitization will generate N206.18 billion.

N1.77 trillion for the deficit will come from external loans.

Revenue

Total federally distributable revenue is estimated at N11.09 trillion in 2023, while total revenue available to fund the 2023 Federal Budget is estimated at N9.73 trillion. This includes the revenues of 63 Government Owned Enterprises (GOE).

Breakdown shows oil revenue is projected at N1.92 trillion, non-oil taxes are estimated at N2.43 trillion, FGN Independent revenues are projected to be N2.21 trillion. Other revenues total N762 billion, while the retained revenues of the GOEs amount to N2.42 trillion Naira

High cost of governance

Nigeria’s high cost of governance, again, showed up in the budget as the country plans to spend as much as N8.27 trillion for staff and salaries of workers among others.

The recurrent expenditure for 2023 is not only a 21.08 percent increase from N6.83 trillion in 2022 but also 40.33 percent of the total expenditure for 2023.

Debt service

Nigeria’s total debt service will gulp N6.30 trillion. This is more than the oil revenue and non-oil revenue expected for 2023.

Read also: RipplesMetrics: How Nigerian taxpayers funded 36 lawmakers’ N74m trip to Canada

As earlier stated, the federal government oil revenue is projected at N1.92 trillion while non-oil taxes are N2.43 trillion this come to N4.3 trillion which is not enough to pay off the debts schedule for the year.

Government cuts ministry of education budget

The administration of president Buhari has decided to cut the budget for education despite cry by stakeholders.

Details from the 2023 budget show that only N663.97 billion was budgeted for education compared to N923.79 billion.

In fact, the budget for defence ministry (N1.09 trillion) is almost two times more than that of education.

Health also takes back seat

The health budget of Nigerians was also reduced in the 2023 budget presented by the president.

Compared to 2021 where N724.92 billion went into the ministry of health, for 2023 the ministry will be getting N580.81 billion.

It is important to note the line items for health and education were almost visible across the MDAs.

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