Federal Government Deficit Spending Rises 28% to N12.1 Trillion in First Ten Months of 2024

The Federal Government’s deficit spending in the first ten months of 2024 increased by 28% year-on-year to N12.1 trillion, exceeding the 2024 budget deficit target of N9.8 trillion by 31%.

This rise occurred despite a 36% increase in federal revenue during the same period, driven by a 54.5% rise in revenue to the Federation Account, which totaled N20.214 trillion.

Revenue peaked in the third quarter at N6.865 trillion but declined by 7.9% in October to N1.988 trillion. Meanwhile, deficit spending showed fluctuations, reaching N4.18 trillion in Q1, growing slightly in Q2, then falling by 23% in Q3 before standing at N361.89 billion in October.

Expenditures rose in the second quarter but dropped in the third, with October seeing a month-on-month increase to N1.83 trillion due to higher capital spending.

From the October revenue, N1.298 trillion was distributed across the three tiers of government, with the federal government receiving N424.87 billion, states N450.96 billion, local governments N332.63 billion, and oil-producing states N90.42 billion under the 13% Derivation Fund.

However, federal retained revenue in October fell 53.23% short of its target, reflecting ongoing fiscal challenges.

The overall fiscal balance widened due to increased expenditure relative to revenue, highlighting the need for enhanced fiscal strategies like broadening the tax base and diversifying income sources.