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Nigeria’s 2022 budget in 11 numbers

Where is N100bn zonal intervention project details, BudgIT asks FG

Nigerians received news of President Muhammadu Buhari’s assent to the 2022 budget with mixed reactions as the budget has earned a reputation of failing to measure up with reality.

The budget is not a significant departure from past budgets since 2015, as it continues to be overly optimistic on revenues and economic metrics from inflation to exchange rate.

BusinessDay has compiled major numbers that summarise the 2022 budget as it relates to previous government budgets and how it will affect the country going forward.


Oil production was pegged at 1.88mbpd with base oil price rising from $57 per barrel after consultation with the NNPC as well as other stakeholders to $62 per barrel following National Assembly increased proposal


The exchange rate maintained its position of N410/$1 as advised by the Central Bank of Nigeria while the inflation rate was projected at 13%. Nominal GDP was projected to rise from N168.60 trillion in 2021 to NN184.38 trillion in 2022. It is also projected to further increase to N221.78 trillion in 2024.

The forecast for Real GDP on the other hand is expected to hit 4.2% by 2022 end. Consumption in 2021 stood at N136.57. However, 2022 is expected to record a rise to N149.35 by year end.


The 2022 budget deficit of N6.39 trillion slightly exceeded the 3% ceiling set by the Fiscal Responsibility Act 2007 (FRA) by 0.39%, indicating a 3.39% of GDP. The minister of finance, budget and national planning, however, alluded to the fact that the country’s recovery from the past two recessions would have been as unsuccessful without the sustained government expenditure funded largely by debt.

The President also notified the public that the expenditure level was necessary to assist with overcoming current security challenges and accelerate post-recession growth.

The country’s fiscal balance as of November 2021 stood at N7 trillion against the initial budget of N6 trillion.

Reports from the budget reveal that the deficit is expected to be financed by new borrowings, privatization proceeds, and drawdown on loans secured for specific projects. However, analysts are of the opinion that the government should begin employing a certain percentage of equity financing.

Ayo Teriba, CEO, Economic Associates, says the country in its present state cannot generate more revenue from both the tax and the non-tax sectors than they formerly generated, considering the impact of the recession on the general populace.

He however states that if the country is ever going to reach a point of ‘budget realism,’ the Federal Government must turn to equity financing (the rich assets Nigeria has, which has been dormant/underutilized for years).

He advises that the economy should begin listing in the equity market rather than solely listing in the debt market.

“It is time Nigeria begins to redirect its focus to equity financing rather than debt financing. These consistent borrowings can never end if we do not consciously end it, because debt is like a wormhole, once you are in it, the journey becomes an infinite loop,” Teriba says.

“However, security challenges must first be addressed as the majority of these equity assets have been overrun by hoodlums and bandits…even the railway is already being hijacked by the bandits,” he states.

Nigeria’s budget deficit (which has consistently increased in the last 5 years), has always been accrued to the rising level of the country’s debt profile and justifiably so; however, the reality is that the country requires significant revenue mobilization strategies.


The current 2022 budget shows that recurrent expenditure stands at N6.9 trillion, representing the largest item within the expenditure portfolio, with 62% relating to personnel cost at N4.1 trillion.

A cursory review of the data in the past 10 years shows that at N29.3 trillion, recurrent non-debt expenditure is about 3x more than the N10 trillion spent on capital expenditure in the last 10 years.

The Buhari government has often compared itself with prior PDP-led governments claiming it has spent more on capital expenditure. In 2020, the government spent N1.7 trillion on capital expenditure, the highest on record.

They have also spent about N1.4 trillion and N1.7 trillion between 2017 and 2020. While their numbers have been impressive, spending on Capex as a percentage of total government expenditure is far lower than any other year in the last 10 years.


The 2022 capital expenditure of N5.4 trillion represents about 34% of 2022 expenditure and also represents an 18% increase in capital expenditure compared to that of 2021.

In the absence of revenue, Nigeria has often sacrificed capital expenditure in the last five years and has ended up spending lower than budgeted.

A recent Moody’s report indicates Nigeria needs to spend about $3.3 trillion in capital expenditure over the next 30 years or $1.1 trillion a decade to close its infrastructure deficit.

This amounts to $100 billion (N40trn) per annum or 28% of Nigeria’s GDP of N144 trillion, a tall task considering where the country is at the moment.

Nigeria is far from this goal and may not meet this target if it continues to spend more on recurrent expenditure compared to capital expenditure.

Also, the government will also need to explore new revenue sources other than oil to boost its revenues while relying less on budget deficits.

Doing this will require massive tax reforms that target the informal sector, block leakages and reduce wasteful incentives.

Read also: Buhari signs 2022 budget into law, expresses concern over “ Worrisome changes to budget


Debt service expenditure is estimated at N3.61tn, representing about 35.6% of the projected revenue for the year. Debt servicing expenditure swallowed up the oil revenue of N3.15 trillion, leaving a deficit of 12.7%.

Another factor to consider is the historical trend of revenue shortfalls in the last five years. The estimated total revenue over the years is hardly ever realised due to a shortage in the inflow from various sources of revenue.

This implies that the debt service figure will continue to grow as a result of factors such as exchange rate differences, thereby surpassing the total revenue required to cover it.

According to the minister of finance, “This is proof that what we have is not a classic debt sustainability problem, rather, it’s a very significant revenue challenge.”

The minister in her presentation justified the increment, saying the country just exited a recession and this was largely due to heavy spending that emanated from much-required borrowings.

“Having witnessed 2 consecutive economic recessions, we have had to spend our way out of recession, which contributed significantly to the growth of the public debt.

“It is unlikely that our recovery from each of the past 2 recessions would have been as successful without the sustained government expenditure funded largely by debt,” she said.

In the last five years, the country’s budget has earned a reputation of dissociating its recommended statistics from eventual realities, and it seems as though year-in, year-out, the country’s fiscal position only gets worse.

She explained that Nigeria’s Debt-to-GDP ratio, which was 76% as of November 2021, remained the highest among Africa’s top economies.


This represented 13.4% of the budget and it comprised the amount provisioned for the Military, Police, Intelligence and Paramilitary (recurrent/capital expenditure).


This comprised 8.3% of the budget and it included provisions for Works and Housing, Power (inclusive of PSRP Provisions), Transport, Water Resources, Aviation.


The government budgeted N1.234 trillion for education, representing an increase of 9.2% compared with the N1.130 trillion provision made in the 2021 budget.

The budget allocation for the education sector was subdivided into 3 categories: N815.69 billion was the amount provisioned for the Federal Ministry of Education and its agencies (recurrent/capital expenditure).

N112.29 billion for Universal Basic Education Commission (UBEC), N306 billion represented transfers to the Tertiary Education Trust Fund (TETFUND) for infrastructure projects in Tertiary institutions.


N876.38 billion was allocated to the health sector of which N770.87 billion is meant for the Federal Ministry of Health and its agencies (recurrent/capital expenditure, including Hazard Allowance).

N49.37 billion will go for Gavi/ Immunisation funds, including Counterpart Funding for Donor Supported Programmes, Including Global Fund. N56.14 billion will be for the Basic Healthcare Provision Fund (BHCPF).


The 2022 budget made provision for revenue worth N10.740 trillion, a 36% increase from the N7.886 trillion provision made in the 2021 budget. However, if history has taught us anything, it is that revenue realisation in the budget is usually far-fetched. The 2021 budget made out revenue projections of N7 trillion, however, only a fraction of that projection came to fruition.

As explained earlier by the minister of finance, debt consumes most of the country’s revenue, hence the country does not necessarily have a debt challenge rather it has a malignant revenue generation crisis.

In line with this fact the minister of finance in her public presentation indicated that the government had put in place initiatives to enable the increase of revenue to meet up with its rising expenditure, some of which include: Enhancing tax and excise revenues; Tax waivers, and concessions re-evaluation; Increasing customs revenue through technology; and Preserving the revenue derived from the oil and gas sector.

She stated that there were about 13 laws that have been amended by the Finance Act 2021 and they include: CIT Act; Customs Excise Tariff Act Consolidated; FIRS Establishment Act; Personal Income Tax; Stamp Duties Act; Tertiary Education Tax Act; VAT Insurance Act, and Nigerian Police Trust Fund Act.