• Recurrent expenditure takes 95 per cent revenue
• Budgetary projection plunges by N218b in one month

The country’s quest to overcome growth and development challenges will remain a mirage as government continues to prioritise huge consumption above capital investments, says a report by the Central Bank of Nigeria (CBN).In November, the Federal Government spent 95.9 percent of its resources on statutory transfers (7.2 percent) and recurrent expenditure (88.7 percent), leaving a paltry 4.1 percent for capital projects.

According to the Economic Report released in November 2019, government’s budgetary projections sustained its pattern of shortfall by N218.05 billion. At N322.62 billion, the estimated Federal Government’s retained revenue for the month of November 2019 was below the monthly budget of N705.44 billion by 54.3 percent.

An analysis of the figure shows that the Federation Account and Value Added Tax (VAT) were 85.6 and 4.7 percent of the total retained revenue, respectively, while the Independent Revenue, Exchange Gain and Solid Minerals accounted for 8.3 percent, 0.2 percent and 1.2 percent, respectively.

Government expended N540.67 billion. This went below the monthly budget estimate of N865.31 billion by 37.5 percent, as well as the N776.87 billion recorded in the preceding month by 30.4 percent.The expenditure pattern shows that the recurrent expenditure took up N479.57 billion (88.7 percent), while capital expenditure got a paltry N22.16 billion (4.1 percent) and transfers took up N38.92 billion (7.2 percent) in the review period.

Of the recurrent expenditure, non-debt obligation (salaries) was N355.36 billion (74.1 percent) while debt service payments accounted for the balance of N124.2 billion (25.9 percent). Consequently, the fiscal operations of the Federal Government resulted in an estimated deficit of N218.05 billion, compared with the monthly budget deficit of N159.87 billion.

The Programme Officer, Public Finance Management, at the Centre for Social Justice, Fidelis Onyejegbu, said the imbalance between recurrent and capital expenditure (CAPEX) in budgeting does not align with the government’s economic recovery growth policy of attaining 30-35 per cent capital expenditure to total budget.

He explained: “The 2020 approved budget of N10.59 trillion, for instance, has a capital component of N2.78 trillion, representing 26.2 per cent of the total approved fiscal plan. This percentage could reduce if, for some reason, the total budget is not fully implemented.

“This was the case in the past years, even when the appropriated capital expenditure was up to 30 percent of the overall budget, like in 2018, when implementation was short. There is a huge personnel cost to be dealt with and there is also the issue of achieving the targeted revenue earnings, as projections in recent years have not been significantly met.” He suggested a study of the Oronsaye Committee Report on reducing the cost of governance with a view to implementing the recommendations contained therein.

The latest fiscal challenges took off as the estimated federally-collected revenue (gross) in the month of November 2019 fell to N858.92 billion, below both the monthly budget estimate of N1.246 trillion and the preceding month’s receipt of N894.09 billion by 31.1 per cent and 3.9 per cent, respectively.

The decline, relative to the monthly budget estimate, was attributed to shortfall in both oil and non-oil revenues, an indication of continued growth struggle, but mostly, dependence on crude oil. Oil receipt, at N489.08 billion or 56.9 percent of total revenue, was below both the monthly budget of N798.83 billion and the preceding month’s receipt of N577.30 by 38.8 percent and 15.3 percent, respectively.

The decrease in oil revenue, relative to the monthly budget estimate, was attributed to shut-ins and shutdowns at some terminals of the Nigerian National Petroleum Corporation. At N369.84 billion or 43.1 percent of total revenue, non-oil receipt was below the monthly budget of N447.24 billion by 17.3 per cent.

The drop in collection, relative to the monthly budget, was due to the decline in revenue from VAT, Education Tax and Federal Government’s Independent Revenue. Of the net sum of N723.31 billion retained in the Federation Account, the sums of N100.72 billion, N26.88 billion, and N23.65 billion were transferred to the VAT Pool Account, Federal Government Independent Revenue, and “others” respectively, leaving a net balance of N572.06 billion for distribution to the three tiers of government and the 13 percent Derivation Fund.

The Federal Government received N276.12 billion, while the state and local governments received N140.05 billion and N107.98 billion, respectively. The balance of N47.91 billion was shared among the oil- producing states as 13 percent Derivation Fund.From the N100.72 billion transferred to the VAT Pool Account, the Federal Government received N15.11 billion, while the state and local governments received N50.36 billion and N35.25 billion.

Additionally, the sum of N1.11 billion was distributed in the month as Exchange Gain, with the federal, state and local governments receiving N520 million, N260 million and N200 million, respectively, while the 13 percent Derivation Fund received N120 million.Also, N8.70 billion was received as solid minerals revenue, with the federal, state, and local governments receiving N3.99 billion, N2.02 billion, and N1.56 billion. The sum of N1.13 billion, however, was given as 13 percent derivation fund for the mineral-producing states.

Generally, the total allocation to the three tiers of government from the Federation Account and VAT Pool Account in November 2019 amounted to N682.59 billion. This was below the monthly budget estimate of N1.091 trillion by 37.4 percent. It however, exceeded the preceding month’s allocation of N673.01 billion by 1.4 percent.

A fiscal governance campaigner, Eze Onyekpere, said there would be no progress until government cuts down bloated costs and improves value for money in overall expenditure, especially in capital expenditure. Also emerging, he said, is the challenge of compelling Ministries, Departments and Agencies (MDAs) to collect and remit all due revenues.

On his part, Jide Ojo, a public affairs analyst, lamented that Nigeria’s expenditure pattern is anti-development. He said the lopsided expenditure pattern in favour of recurrent, debt service and statutory transfers cannot bring development.

“This skewed expenditure pattern is not limited to the Federal Government, but also the remaining two levels of government – state and local. If we hope to fix infrastructure deficit across the three levels, deliberate attempts must be made to significantly improve the capital vote and its implementations,” he said.

Source: https://m.guardian.ng/news/nigerias-economy-under-siege-over-bad-government-choices/

All thanks to our certificateless Tyrant of Daura

Yes, Kemi was slightly dumb but with the look of things, Baba Lifeless is totally clueless and dumb.

Politicians earn too much. Let them start by cutting down their salaries. Do you know that Nigerian politicians earn the highest salaries among other countries politicians
Secondly, we need to diversify our Economy. It isn't only oil we should depend on. *By the way, closing the border helps promote our products within the country and gradually, in other countries.

This is what happens when a nation's economy is runned by illiterates.Nigeria's major oil-dependent and import economy is only programmed to failed with its low GDP ration.You can't run an economy on borrowing & indiscriminate taxation for recurrent expenditure.Debts servicing is not debts repayment.

The Yoruba newsmedia have lately been up in arms fighting against their darling president and Papa. Unfortunately for them, the man is a monster who doesn't care about what they write or say. He's not Goodluck Jonathan. They should relax and enjoy the next level, next year is going to be more bad and rough for them .

Tinubu! Tinubu!! Tinubu!!! How many times did I call you? See what you have caused us with your greed

the cry of the masses never go past their roof. suck it up and enjoy your Next Level

Blakewilli:
Politicians earn too much. Let them start by cutting down their salaries. Do you know that Nigerian politicians earn the highest salaries among other countries politicians
Secondly, we need to diversify our Economy. It isn't only oil we should depend on. *By the way, closing the border helps promote our products within the country and gradually, in other countries.

Kindly note sir Blake,
We gave you your first like and share.....

Blakewilli:
Noted.Thanks

Cool!

OK

Well from all of us MANNABBQGRILLZ and other nairaland irritants we want to say all these information are false and as Oga Lie Mohammed stated " Nigerian economy is at its best since Bubu was last in power"

Please dont forget to call for our BBQ and expired chicken tomorrow. Thank you

Major General Buhari wants to kill us with hunger

True

Tell us something we don't know already.....

Government actions are designed to achieve the diversification of the economy. But Nigerians need to get behind the program, we need to embrace and maintain unity of purpose.

Na wa

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MOTTO: WE TREATS BUT GOD HEALS.

Lagos Indian print media firing from all nozzle.




It's too late

Sai Baba 2032

1 dollar is already 1naira bokoharam has been defeated, petrol is already N45naira 4+4+4
https://www.nairaland.com/4814062/aluminium-windows-building-casement-casement/7

The likes of budaatum thinks Nigeria economy is bad because the common man on the street is lazy. Can you imagine!

If rice goes for 50k per bag, he will still cover for Buhari and blame the common man on the street.

I'm forced to conclude that all APC Supporters are bunch of idiots. It's like their brains have been evacuated. Their reasonings are upside down. And it baffles me how they mange not to know that they are acting like Idiots.

cc:



Simplyleo

Sarrki,

etc

No, it is due to the bad choices of SW in 2015 that imposed bad government on us

He explained: “The 2020 approved budget of N10.59 trillion, for instance, has a capital component of N2.78 trillion, representing 26.2 per cent of the total approved fiscal plan. This percentage could reduce if, for some reason, the total budget is not fully implemented.


Can we just break this country called Nigeria ��
You heard Billions upon Billions yet no tangible positive changes I wept for future of our kids and unborn

My pity is on those working with Buhari. Nothing wilĺ happen to him even if he grounds the economy being a secret pact reached by the elites former presidents never to prosecute themselves.
But those serving under them would have a lot to explain.

helinues:

May your life and destiny represent everything that Nigeria represents under buhari. Amen.

May your entire family flourish the same way Nigeria "flourishes" under buhari, amen.

post=85180092:

Kindly note sir Blake,
We gave you your first like and share.....

You and your vultures?