FG spent N2tn on debt servicing in six months – Finance minister

• N3tn released for capital projects

The Federal Government spent N2.02 trillion on debt servicing in the first six months of 2021 (January-June), Minister of Finance, Budget and National Planning, Zainab Ahmed, has said.

The amount represents 90.6 per cent of the retained revenue of N2.23 trillion for the period.

Ahmed said the FG’s retained revenue amounted to 67.3 per cent of the target.

She stated this on Monday, in Abuja, during the 2022- 2024 2022-2024 medium-term expenditure framework/ fiscal strategy paper (MTEF/FSP) committee interactive session.

Last year, out of total revenue of N3.42 trillion, the FG spent N3.34 trillion on debt servicing – implying that for every N100 earned as revenue, N97 was spent on debt servicing.

Given the breakdown, the minister said oil revenue was N492.44 billion, representing 49 per cent performance, while the non-oil revenue totalled N778.18 trillion at 104.5 percent performance, according to the News Agency of Nigeria.

According to her, companies income tax (CIT) and value-added tax (VAT) collections are ahead of the budget targets with N397.02 billion and N129 billion.

This, she added, represented 116.5 per cent and 108.2 per cent targets for the period.

Ahmed said that Customs collection was N234.02 billion at 92.1 percent of target, adding that other revenues amounted to N922.09 billion — out of which independent revenue was N558.13 billion.

On the expenditure performance, Ahmed said N5.81 trillion, representing 92.4 per cent of the budget had been spent, adding that this excludes GOEs and project-tied debt expenditure.

“Of the expenditure, N2.02 trillion was for debt servicing, which is 35 percent of the Federal Government expenditures and N1.795 trillion for personnel cost,” Zainab said.

“This is including pension at 30.9 percent of Federal Government revenue.”

She noted that as of June, N1.3 trillion, which represented 84.7 per cent, had been released for capital expenditure.

The finance minister said that the country faced serious economic challenges in 2020, with the microeconomic environment significantly disrupted by the COVID-19 pandemic.

She said the economy sustained a tepid recovery in the first quarter of 2021.