A budget is a vital tool for achieving a country’s economic strategy. It is designed to shape its entire socio-economic landscape for the year and the future, with the budget allocation serving as a guide for the government’s long-term economic vision. Simply put, the budget is really about how much revenue the government collects, what the revenue will be used for, and how shortfalls – deficits – between revenue and expenditure will be met (in this case, through debt accumulation). It is a powerful tool for the assessment of the transparency of the management of public finances. In this regard, various constitutional and legal provisions require the government to meet certain bars, thresholds and limits to ensure that the budgetary process ensures economic stability, debt sustainability, and prosperity for all.
In this analysis, we will review President Bola Tinubu‘s proposed 2024 budget, assess the compliance of the budgetary process with legal and constitutional provisions, and conclude with a position on what the 2024 budget means for Nigeria’s economic revival. One should provide a caveat that the federal government budget is not representative of the aggregate fiscal stimulus in the economy. State and local governments also stimulate the economy through taxes, programmes and projects. Without the consolidated budget of the states and local governments, this analysis is focused on the federal budget, which accounts for around 85 per cent of aggregate fiscal stimulus.
The aggregate FGN revenue is projected at N18.32 trillion. Oil revenue is projected to increase by 344 per cent, relative to 2023, while revenue derived from the non-oil sector – corporate income tax, VAT, import and customs duty, etc – is projected at a 54 per cent increase over the 2023 forecast.
