The Federal Government recorded a fiscal deficit of ₦4.69 trillion in the first quarter of 2026, as revenue generation fell significantly below its budget target, according to the Budget Office of the Federation.
Figures contained in the 2026 First Quarter Budget Implementation Report show that the government generated ₦5.08 trillion in revenue between January and March, against a prorated target of ₦9.22 trillion. This represents a shortfall of approximately ₦4.14 trillion, or 44.93 per cent.
Despite the shortfall, revenue was 2.63 per cent higher than the ₦4.95 trillion recorded in the corresponding period of 2025.
The report attributed the weak revenue performance largely to lower-than-projected oil receipts, reduced crude oil production and lifting, as well as underperformance in non-oil revenue collections.
Although crude oil averaged about $83 per barrel during the quarter, above the 2026 budget benchmark of $64.85, the higher international price did not translate into the expected government revenue.
On expenditure, the Federal Government spent ₦9.76 trillion during the period, compared with its quarterly projection of ₦17.08 trillion.
Debt servicing accounted for a significant portion of the spending, gulping ₦4.63 trillion, above the prorated target of ₦3.88 trillion by 19.27 per cent.
The report also showed that gross non-oil revenue stood at ₦4.91 trillion, falling short of the quarterly target of ₦7.26 trillion by 32.34 per cent.
Capital budget implementation remained constrained, with releases for the 2026 capital budgets of ministries, departments and agencies yet to commence as of March 31. The utilisation period for 2025 capital releases had been extended to December 31, 2026.
Meanwhile, the government’s fiscal deficit was below its projected first-quarter figure of ₦7.86 trillion, although the revenue shortfall and high debt-service burden continue to place pressure on public finances.
The report highlights the government’s continuing challenge of improving revenue mobilisation while meeting its expenditure and debt obligations.
