The Federal Government plans to spend 61.63 per cent of its planned 2024 on personnel and debt service costs.
The personnel and pension costs of N7.78tn and the debt service cost of N8.25tn make up N16.03tn out of the N26.01tn 2024 budget.
The PUNCH also observed that the government would spend more on debt servicing than it would spend on paying the salaries and pensions of its workers.
Also, the amount budgeted for personnel and pension costs is expected to increase from N5.87tn in 2023 to N7.78tn in the 2024 budget.
This showed an increase of N1.91tn or 32.54 per cent amid concerns for a reduction in the cost of governance.
It was also observed a 30.74 per cent increase in debt service cost from N6.31tn in 2023 to N8.25tn by 2023.
The World Bank in June 2023 stated that the Federal Government’s spending on personnel costs and debt servicing exceeded total revenues in 2022.
This is as it approved the Medium-Term Expenditure Framework for 2024 – 2026.
The FG affirmed that the administration would maintain the January – December budget implementation cycle as President Bola Tinubu would soon present the 2024 appropriation bill to the National Assembly to ensure its ratification before December 31, 2023.
“The aggregate expenditure is estimated at N26.01tn for the 2024 budget, which includes statutory transfers of N1.3tn non-debt recurrent expenditure of N10.26tn. Debt service estimated at N8.25tn as well as N7.78tn being provided for personnel pension cost,” the Minister of Budget and National Planning, Abubakar Bagudu, told State House Correspondents after the Federal Executive Council meeting at the Presidential Villa, Abuja.
Bagudu clarified the increased debt service, saying it was “because N22.7tn Ways and Means was securitised, meaning it became a Federal Government debt at nine per cent.”
Equally, personnel costs rose significantly due to transfers from the agreement between the Federal Government and the Organised Labour.
The PUNCH earlier reported that the Federal Government might incur an additional N315bn in wage bills in the next six months for the newly introduced allowance for federal workers.
This came as the Organised Labour agreed to suspend its proposed nationwide strike for 30 days, following the signing of a Memorandum of Understanding with the Federal Government after a marathon meeting.
