According to data from the budget office, Nigeria’s budget deficit has risen to N20.64 trillion from 2016 to 2020.
A budget deficit occurs when expenses exceed revenue and indicate the financial health of a country. According to the budget office, more than N7.97tn was borrowed from foreign and domestic sources to fund these deficits.
Breakdown by year
The budget office said the Federal Government generated a revenue of N3.42tn to fund the budget in 2020, however, spending for the year was N10.02tn, 0.43 percent above the N9.97tn budgeted.
Hence, the budget deficit for the year was N6.59tn (14.17 per cent of the 2020 GDP), and this was partly financed through domestic borrowing of N2.06tn.
In 2019, it generated a total of N4.12tn to fund the budget. For the year, total expenditure was N8.29tn, a decrease of N618.14bn (6.93 per cent) from the annual projection. The budget deficit stood at N4.18tn (2.9 percent of 2019’s GDP), and was partly financed through domestic borrowing of N912.82bn.
In 2018, a total of N3.48tn, excluding other funding sources, was generated in revenue to fund the year’s budget. However, total spending was N7.51tn, a decrease of N1.61tn from the budget. This meant a budget deficit of N3.65tn (2.85 percent of the 2018 GDP), which was financed to the tune of N2.50tn through foreign borrowing of N1.17tn and domestic borrowing of N1.34tn.
In 2017, the office said a total of N2.38tn revenue, excluding other funding sources, was generated to fund the budget in 2017. It added that actual expenditure in 2017 was N6.46tn, a N977.57bn decrease from the annual projection. This left a budget deficit of N3.81tn, which was financed to the tune of N2.50tn, comprising N1.17tn and N1.34tn of external and domestic borrowings respectively.
In 2016, the Federal Government generated a revenue of N2.95tn to fund the budget. For the year, total government spending was N5.36tn, an expenditure shortfall of N700bn of the budget estimate of N6.06tn for the period. Budget deficit was N2.41tn (2.37 percent of GDP) or 45 per cent of total expenditure.