FG spends N5.24trn for debt servicing in 2023

…Finance Minister says only N12.87trn of N17.1trn 2022 Budget spent as at November

The Federal Government (FG) has disclosed that it spent not less than N5.24trillion on debt servicing in 2022.

Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said this at the Public Presentation and Breakdown of the Approved Federal Government 2023 Budget on Wednesday in Abuja.

She also disclosed that the Federal Government spent only N12.87 trillion as at Nov 30 out of  N17.126 trillion budgeted for 2022,

Ahmed said out of the N12.87 trillion, N5.24 trillion was for debt service and N3.94 trillion was for personnel costs.

The Minister said, “The actual spending as of November 30 was N12.87 trillion.

“Of this amount, N5.24 trillion was for debt service; N3.94 trillion for Personnel Costs, including pensions; Statutory Transfers, Overhead and Service Wide Votes expenditures totalled N1.81 trillion; and N1.88 billion was released for capital expenditure.”

Meanwhile, the Minister said the fiscal deficit for 2022 was estimated at N8.17 trillion, inclusive of the supplementary Budget.  She also added that as at Nov. 30, 2022, the deficit was N6.37 trillion.

“The deficit was totally financed by borrowings, mostly from domestic sources,” she said.

Recall that President Muhammadu Buhari on Tuesday signed the 2023 Appropriation Bill of N21.83 trillion passed by the National Assembly into law.

Although President Buhari signed the 2023 Budget passed by the National Assembly to him on Tuesday, yet he noted with critical attention the injection of projects that further swelled the budget.

President Buhari on Tuesday signed the 2023 Appropriation Bill of N21.83 trillion along with the 2022 Supplementary Appropriation Bill into law at the Presidential Villa, Abuja.

He critically noted that the National Assembly introduced new projects into the 2023 budget proposal he submitted, allocating the sum of N770.72 billion.

The President also said that the parliament increased the provisions made by Ministries, Departments and Agencies (MDAs) by N58.55 billion.

Speaking at the signing of the eighth and final annual budget of his Administration, the President said the aggregate expenditures of N21.83 trillion, is an increase of N1.32 trillion over the initial Executive Proposal for a total expenditure of N20.51 trillion.

Buhari explained that the 2022 Supplementary Appropriation Act would enable the administration to respond to the havoc caused by the recent nationwide floods on the infrastructure and agriculture sectors.

As it is customary, he said the Minister of Finance, Budget and National Planning will subsequently provide more details of the approved budget and the supporting 2022 Finance Act.

“We have examined the changes made by the National Assembly to the 2023 Executive Budget proposal.

“The amended fiscal framework for 2023 as approved by the National Assembly shows additional revenues of N765.79 billion and an unfunded deficit of N553.46 billion.

“It is clear that the National Assembly and the executive need to capture some of the proposed additional revenue sources in the fiscal framework. This must be rectified.

“I have also noted that the National Assembly introduced new projects into the 2023 budget proposal for which it has appropriated N770.72 billion. The National Assembly also increased the provisions made by Ministries, Departments and Agencies (MDAs) by N58.55 billion,” he said.

Buhari said his decision to sign the 2023 Appropriation Bill into law as passed by the National Assembly was to enable its implementation to commence without delay, considering the imminent transition process to another democratically elected government.

He, however, directed the Minister of Finance, Budget and National Planning to engage with the Legislature to revisit some of the changes made to the Executive budget proposal, expressing hope that the National Assembly will cooperate with the Executive arm of Government in this regard.

Recall, the National Assembly (NASS) passed the 2023 Budget on Dec. 28, 2022 after it was laid before a joint session of the NASS on Oct. 7, 2022.

Also, the Finance Bill 2022 was passed to reinforce the administration’s public financial management reforms.  The Act is expected to make key reforms on tax laws among others.