The Central Bank of Nigeria (CBN) has reported that the federal government’s fiscal deficit has increased to N746.30 billion in November 2022.

This is 40.6 percent increase when compared to N530.87billion recorded in the month of October 2022.

The apex bank disclosed this in its November 2022 Economic Report, released on Tuesday

The report noted that the increase in the fiscal deficit reflected the 9.1 per cent rise in provisional expenditure and 21.4 per cent shortfall in revenue in the review period.

CBN stated that the rise in expenditure was driven by high overhead costs, capital expenditure and transfers while the decline in the government’s retained revenue was as a result of lower receipts from the Federation Account, its independent revenue sources, and other revenue from special accounts and special levies.

Part of the report reads: “The estimated overall fiscal deficit of the FGN expanded in November, reflecting the 9.1 per cent rise in provisional expenditure and 21.4 per cent shortfall in revenue. At negative N746.30 billion, the provisional fiscal deficits of the FGN expanded by 40.6 per cent and 21.8 per cent above the levels in the preceding month and the budget benchmark, respectively.

“The FGN retained revenue (provisional) declined in the period, following lower receipt from the Federation Account, its independent revenue sources, and other revenue from Special Accounts and Special Levies. At N430.81 billion, provisional retained revenue of the FGN was below the level in October and the proportionate budget by 21.4 per cent and 48.1 per cent, respectively

Driven by high overhead costs, capital expenditure and transfers, the provisional aggregate expenditure of the FGN rose by 9.1 per cent relative to the level in October but was 18.4 per cent below the monthly budget target.

“The provisional aggregate expenditure of N1,177.11 billion, consisted of recurrent expenditure, capital expenditure, and transfers in the proportion of 86.8 per cent, 7.7 per cent and 5.5 per cent, respectively.”

Specifically, the report stated that at N991.09 billion, gross federation receipts in November were below the level in October and the budget target by 15.9 per cent and 37.3 per cent, respectively, adding that the decline in federation revenue was majorly attributed to shortfalls of N290.48 billion (54.2 per cent) and N285.89 billion (53.8 per cent) in petroleum profit tax and royalties, relative to October and the monthly target.

It further said that in terms of contribution to federation earnings in the period, non-oil revenue remained dominant, accounting for 74.6 per cent, while oil revenue made up the balance of 25.4 per cent. The report also disclosed that at N739.23 billion, non-oil revenue in November exceeded earnings in the preceding month by 15.8 per cent but was below the monthly target by 6.3 per cent.

“The increase in nonoil receipts, relative to October, was largely ascribed, to improvements in collections from corporate tax, customs and excise duties and VAT, with increases of 39.2 per cent, 19.0 per cent and 12.3 per cent, respectively,” the report stated