By Yahaya Umar
Federal Government of Nigeria ,FGN, revenue underperformed expectations, down by more than 31% to settle at N1.94 trillion at the end of January 2025, according to a Central Bank ,CBN, report.
The provisional data released by the Apex Bank showed that fiscal operations of the federal government of Nigeria ,FGN, resulted in an expansion of fiscal deficit in January compared with the level in the preceding month.
Federally collected revenue declined by 31.35%, relative to the level in December 2024 on the back of weak income generated from oil and non-oil sources. The CBN reported that the retained revenue of the FGN decreased by 69.19% while its aggregate expenditure declined by 15.51%.
At N1.94 trillion, provisional gross federation account receipt was 31.35 and 35.22% below the level in the preceding month and the benchmark, respectively, the report stated.
Gross federally collected revenue underperformance was due, largely, to a reduction in receipts from Petroleum Profit Tax ,PPT, royalties, company income tax, and customs & excise duties.
Nevertheless, the composition of gross federation revenue showed that non-oil revenue remained dominant, accounting for 68.67%, while oil revenue constituted the balance.
Non-oil revenue, at N1.33 trillion, was 22.18% below the level in the preceding month, driven by low collections from federal government independent revenue, customs & excise duties, and corporate tax, according to the report.
However, it was 8.25% above the monthly target of N1.23 trillion. Oil revenue also declined by 45.45% to N0.61 trillion from the level in December 2024 on account of lower receipts from Petroleum Profit Tax ,PPT, and royalties.
It was 65.55% short of the monthly target, due, largely, to shut-ins arising from aging oil pipelines and installations. The report revealed that from the federally collected revenue of N1.94 trillion, a net balance of N1.42 trillion was distributed to the three tiers of government after accounting for additional revenue and statutory deductions and transfers.
The federal, state, and local governments received N0.45 trillion, N0.50 trillion, and N0.36 trillion, respectively, while the balance of N0.11 trillion was allocated to the 13% Derivation Fund for oil-producing states.
Net disbursement was 17.52% below the level in the preceding month and 38.30% short of the monthly target. FGN retained revenue declined in the review period, owing, largely, to lower receipts from Federal Government Independent Revenue and FGN’s share of exchange gain.
At N0.48 trillion, provisional FGN retained revenue was 69.19 and 70.40% below the levels recorded in the preceding period and monthly target, respectively.
