1. Nigeria Budget &
Its Components

2. A budget is an essential aspect of Individual,
Organisation and Government financials. It is a plan
stated in monetary terms.
to:
The purpose of Budget is to:
Provide a forecast of revenues and expenditures
Enable the actual financial operation of the
business to be measured against the forecast.
Establish the cost constraint for a project,
program, or operation
budgets?
Why do we produce budgets?
To control resources
To communicate plans to various Stakeholders
To motivate and strive to achieve budget goals
To evaluate the performance
To provide visibility into performance Source: wikipedia

3. The Nigeria budget is made up of four
components:
Part A – Statutory Transfers
Part B – Debts Service
Part C – Recurrent Expenditure (non-debt)
Part D – Capital Expenditure
MDA Expenditure
Statutory Recurrent Capital
Debt Service
Transfer Expenditure Expenditure
Consolidated Revenue Fund of the Federation

4. Statutory Transfer:
The Federal Government is required by law to make
certain mandatory expenditures annually in respect of:
NJC The National Judicial Council
The Niger Delta Development
NDDC Commission
The Universal Basic Education
Statutory UBEC Commission
Transfer INEC
The Independent National
Electoral Commission
NASS The National Assembly
The National Human Rights
NHRC Commission

5. Whenever the Federal Government
Debt Service: spends more money than the revenues it
earns, it must find the financial resources
to pay for this additional spending.
Domestic Moneys borrowed
within Nigeria
Debts
Debt
Service
Foreign moneys borrowed
from outside Nigeria
Debts
When the government pays interest and principal
on its debts, this is referred to as Debt Service.

6. Statutory Transfer & Debt Services
Statutory
Transfer
18.73%
Debts
Services
Statutory Transfers and Debt Service
currently make up on average about
18.73% of Federal spending

7. Recurrent Expenditure (non-debt):
(non-
Spending by the Ministries, Departments and Agencies
(MDA) of Government on Salaries Pensions & Overheads
Salaries,
The Federal Government employs
people to work in the various MDAs and
Salaries pays them salaries in order to maintain
the administration of government and
continue to provide public goods and
services.
In addition to the pension contributions
paid on behalf of workers under the
Recurrent Contributory Pension Scheme, the
(non-debt)
Pensions Federal Government continues to pay
the pensions of existing pensioners
under the old Pay-As-You-Go System.
Payment for electricity, water,
telecommunications, office rent, office
Overheads equipment and consumables, staff
training, transportation, etc.

8. Capital Expenditure:
Capital Expenditure is used to provide infrastructure such as
roads, water and power; fund educational services such as
schools, colleges and universities; and provide healthcare
facilities and services among others.
Infrastructure
Capital Educational
Expenditure Services
Healthcare

9. Recurrent & Capital Expenditure:
Recurrent
Expenditure
81.27%
Capital
Expenditure
The balance of 81.27% is MDA Expenditure, that
is, money spent by the MDAs of Government to
provide public goods and services

10. Nigeria Budget in a nutshell:
Statutory Debt Recurrent Capital
Transfer Services Expenditure Expenditure
MDA Expenditure
NJC Domestic Infrastructure
Salaries
Debts
NDDC Foreign Pensions Educational
UBEC Debts Services
Overheads
INEC Healthcare
NASS
NHRC
≈ 81.27%
≈ 18.73%

11. Empirical Analysis of Budget Components
(2004 – 2007)
YEAR BUDGET COMPONENTS ALLOCATION % %
TOTAL - STATUTORY TRANSFERS 102,300,000,000 4.51%
18.90
TOTAL - DEBTS SERVICE 326,000,000,000 14.38%
2007 TOTAL - RECURRENT (NON-DEBT) 1,056,563,540,997 46.62%
81.10
TOTAL - CAPITAL EXPENDITURE 781,530,882,480 34.48%
AGGREGATE EXPENDITURE 2,266,394,423,477
TOTAL - STATUTORY TRANSFERS 86,460,000,000 4.61%
20.04
TOTAL - DEBTS SERVICE 289,500,000,000 15.43%
2006 TOTAL - RECURRENT (NON-DEBT) 961,108,775,596 51.22%
79.96
TOTAL - CAPITAL EXPENDITURE 539,233,587,755 28.74%
AGGREGATE EXPENDITURE 1,876,302,363,351
TOTAL - STATUTORY TRANSFERS 89,600,000,000 4.98%
24.74
TOTAL - DEBTS SERVICE 355,723,000,000 19.76%
2005 TOTAL - RECURRENT (NON-DEBT) 737,330,997,094 40.96%
75.26
TOTAL - CAPITAL EXPENDITURE 617,284,246,044 34.29%
AGGREGATE EXPENDITURE 1,799,938,243,138
TOTAL - STATUTORY TRANSFERS 532,324,500,000 29.72%
50.35
TOTAL - DEBTS SERVICE 369,369,000,000 20.63%
2004 TOTAL - RECURRENT (NON-DEBT) 539,286,472,751 30.11%
49.65
TOTAL - CAPITAL EXPENDITURE 349,868,371,837 19.54%
AGGREGATE EXPENDITURE 1,790,848,344,588

12. Empirical Analysis of Budget Components
(2008 – 2011)
YEAR BUDGET COMPONENTS ALLOCATION % %
TOTAL - STATUTORY TRANSFERS 196,115,163,718 4.64%
17.47
TOTAL - DEBTS SERVICE 542,381,827,452 12.83%
2011 TOTAL - RECURRENT (NON-DEBT) 2,481,705,176,915 58.72%
82.53
TOTAL - CAPITAL EXPENDITURE 1,005,989,391,174 23.80%
AGGREGATE EXPENDITURE 4,226,191,559,259
TOTAL - STATUTORY TRANSFERS 180,279,158,994 3.91%
14.70
TOTAL - DEBTS SERVICE 497,071,797,452 10.79%
2010 TOTAL - RECURRENT (NON-DEBT) 2,077,358,560,347 45.08%
85.30
TOTAL - CAPITAL EXPENDITURE 1,853,906,761,420 40.23%
AGGREGATE EXPENDITURE 4,608,616,278,213
TOTAL - STATUTORY TRANSFERS 140,693,160,103 4.90%
14.78
TOTAL - DEBTS SERVICE 283,649,892,795 9.88%
2009 TOTAL - RECURRENT (NON-DEBT) 1,649,429,453,681 57.46%
85.22
TOTAL - CAPITAL EXPENDITURE 796,737,536,101 27.76%
AGGREGATE EXPENDITURE 2,870,510,042,679
TOTAL - STATUTORY TRANSFERS 187,600,000,000 7.53%
22.46
TOTAL - DEBTS SERVICE 372,200,000,000 14.94%
2008 TOTAL - RECURRENT (NON-DEBT) 1,259,121,253,061 50.52%
77.54
TOTAL - CAPITAL EXPENDITURE 673,155,465,876 27.01%
AGGREGATE EXPENDITURE 2,492,076,718,937

13. Empirical Analysis of Budget Components
(2012 – 2013)
YEAR BUDGET COMPONENTS ALLOCATION % %
TOTAL - STATUTORY TRANSFERS 387,976,000,000 7.78
19.65
TOTAL - DEBTS SERVICE 591,764,000,000 11.87
2013 TOTAL - RECURRENT (NON-DEBT) 2,386,024,770,349 47.84
80.35
TOTAL - CAPITAL EXPENDITURE 1,621,455,655,252 32.51
AGGREGATE EXPENDITURE 4,987,220,425,601
TOTAL - STATUTORY TRANSFERS 397,929,101,917 8.38
20.16
TOTAL - DEBTS SERVICE 559,580,000,000 11.78
2012 TOTAL - RECURRENT (NON-DEBT) 2,471,814,067,335 52.05
79.84
TOTAL - CAPITAL EXPENDITURE 1,319,777,651,919 27.79
AGGREGATE EXPENDITURE 4,749,100,821,170

14. Graphical Representation of Statutory Transfer
(2004 – 2013)
TOTAL - STATUTORY TRANSFERS
29.72%
30.00%
25.00%
20.00%
15.00%
10.00% 8.38%
7.78% 7.53%
4.64% 4.90% 4.51% 4.61% 4.98%
5.00% 3.91%
0.00%
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 AVG
NJC 17.27% 21.36% 48.44% 50.48% 55.44% 41.58% 42.03% 40.48% 36.83% 5.64% 35.95%
NDDC 15.81% 13.74% 23.86% 24.93% 19.28% 37.26% 23.46% 24.27% 32.14% 2.63% 21.74%
UBEC 19.66% 17.15% 27.70% 24.60% 25.28% 21.16% 34.51% 35.25% 31.03% 23.63%
NASS 38.66% 37.70% 56.72% 85.54% 45.86% 39.31% 58.65% 52.05% 61.87% 6.52% 48.29%
INEC 8.25% 10.05% 23.15% 27.85% 11.40% 6.77% 63.03% 6.46% 15.70%
NHRC 0.35% 0.03% 0.04%
Top Spenders: 1st = NASS 2nd =NJC 3rd = UBEC

15. Graphical Representation of Debt Services
(2004 – 2013)
TOTAL - DEBTS SERVICE
25.00%
20.63%
19.76%
20.00%
14.94% 15.43%
15.00% 14.38%
11.78% 12.83%
11.87%
10.79%
9.88%
10.00%
5.00%
0.00%
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 AVG
DOMESTIC
91.82% 91.49% 92.82% 93.18% 80.31% 82.27% 81.29% 75.99% 52.22% 50.29% 79.17%
DEBTS
FOREIGN
8.18% 8.51% 7.18% 6.82% 19.69% 17.73% 18.71% 24.01% 47.78% 49.71% 20.83%
DEBTS

16. Graphical Representation of Recurrent Expenditure
(2004 – 2013)
TOTAL RECURRENT (NON-DEBT)
70.00%
58.72% 57.46%
60.00%
52.05%
50.52% 51.22%
50.00% 47.84% 46.62%
45.08%
40.96%
40.00%
30.11%
30.00%
20.00%
10.00%
0.00%
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Top Spenders of Recurrent Expenditure:
MDAs Gross %
EDUCATION 12.66
POLICE FORMATION AND COMMANDS 11.33
DEFENCE/MOD/ARMY/AIR FORCE/NAVY 11.00
HEALTH 7.38
INTERIOR 6.73

17. Graphical Representation of Capital Expenditure
(2004 – 2013)
TOTAL CAPITAL EXPENDITURE
45.00%
40.23%
40.00%
34.48% 34.29%
35.00% 32.51%
27.79% 28.74%
30.00% 27.76% 27.01%
25.00% 23.80%
19.54%
20.00%
15.00%
10.00%
5.00%
0.00%
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Top Spenders of Recurrent Expenditure:
MDAs Gross %
WORKS 13.58
POWER 10.64
FEDERAL CAPITAL TERRITORY ADMINISTRATION 10.18
AGRICULTURE & RURAL DEVELOPMENT 6.57
WATER RESOURCES 5.40
EDUCATION 5.21
TRANSPORT 4.81
HEALTH 4.73
DEFENCE/MOD/ARMY/AIR FORCE/NAVY 3.34

18. 70.00%
Graphical Representation of
60.00%
All Budget Components
58.72% 57.46%
52.05% 51.22%
50.52%
50.00% 47.84% 46.62%
45.08%
40.96%
40.00%
30.11%
30.00%
20.00%
10.00%
0.00%
2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Statutory Transfer Recurrent Expenditure
Debt Services Capital Expenditure
Evidently, Recurrent Expenditure (Salaries,
Pensions and Overheads) enjoys a huge share of
Nigeria’s yearly budget

19. Summary of the Budget Components
(2004 – 2013)
Recurrent Expenditure
(Salaries, Capital Expenditure
Pensions &
Overhead
costs) (Infrastructure, Debt Services
Educational Statutory
Services & Transfer
(NJC
Health) (Domestic NDDC
& Foreign UBEC
Debts) NASS
INEC
48.06% 29.62% 14.23% NHRC)
8.10%

20. source:
Data source:
- Budgit (http://www.budgit.com/)
- Nigeria Budget office (www.budgetoffice.gov.ng)
Analysis by: Wale Micaiah (M.sc., CISM, CCNP-Sec, MCSA)
e: walegate@yahoo.com
m: 08078001800
b: walemicaiah.blog.com
w. www.statisense.com
Freely share, freely use and freely acknowledge the source – © Wale Micaiah