The Federal Government exceeded its 2024 borrowing target by N4.79 trillion after falling short of its projected revenue, according to the latest Budget Office of the Federation report.
The Fourth Quarter and Consolidated Budget Implementation Report for 2024 showed that the government borrowed N12.62 trillion during the year. The figure exceeded the approved borrowing target of N7.83 trillion by 61.2 per cent.
Revenue falls below target
The Budget Office attributed the higher borrowing mainly to weaker-than-expected revenue.
According to the report, the Federal Government generated N20.98 trillion in revenue against a budget target of N25.88 trillion. Consequently, the fiscal deficit widened to N13.51 trillion, surpassing the approved deficit of N9.18 trillion.
Although total expenditure reached N34.49 trillion, it remained slightly below the approved estimate of N35.06 trillion. The report therefore linked the wider deficit to lower revenue rather than excessive spending.
Borrowing rises above budget
The report showed that domestic borrowing remained on target at N6.06 trillion.
However, foreign borrowing climbed to N3.37 trillion, exceeding the budget by N1.60 trillion. In addition, the government received N3.19 trillion in budget support despite making no provision for it in the 2024 budget. Together, the three sources pushed total new borrowing to N12.62 trillion.
The Budget Office also disclosed that new borrowing financed about 36 per cent of the Federal Government’s 2024 budget.
Oil revenue underperforms
Oil earnings remained below expectations during the year.
The report showed that gross oil revenue stood at N15.07 trillion, falling N4.93 trillion short of the budget estimate. It attributed the decline to lower crude oil prices and reduced production levels.
Meanwhile, non-oil revenue outperformed expectations. Collections from Company Income Tax, Value Added Tax, Electronic Money Transfer Levy and Customs revenue lifted non-oil revenue to N16.09 trillion, exceeding the budget estimate by N5.29 trillion.
Debt burden continues to grow
The report further showed that Nigeria’s total public debt rose to N144.67 trillion by the end of December 2024.
It added that the country’s debt-to-GDP ratio increased to 61.22 per cent. According to the Budget Office, the figure exceeds both Nigeria’s 40 per cent benchmark and the 56 per cent threshold for comparable economies.
Economists urge fiscal discipline
Development economist Aliyu Ilias warned that rising borrowing could increase inflation and worsen the cost of living if the government fails to manage the funds effectively. He stressed that the key issue is not borrowing itself but how the money is spent.
Similarly, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Muda Yusuf, urged the government to slow the growth of public debt and strengthen revenue generation. He said sustainable fiscal policies would reduce Nigeria’s dependence on borrowing over time.
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