This research work was aimed at
carrying out statistical analysis of federal government’s revenue and
expenditure 2003-2008. Secondary data was obtained from National Bureau of
Statistics. The statistical package used is Mintab. The result of the analysis
shows that there is positive and strong relationship between expenditure and
revenue 0.938 and the regression equation is expenditure = 123 + 0.367 revenue.
The regression equation shows that when the revenue increase, the expenditure
TABLE OF CONTENTS
Table of Contents
Background of the Study
1.2 Aims of the
1.3 Objectives of
1.4 Scope of the
1.5 Definition of
CHAPTER TWO: LITERATURE
REVIEW AND STATISCAL TOOL(S)
2.1 Nigerian Economy
and oil ….
2.2. Inflation in
2.3 Effect of the
global economic meltdown on the Nigeria economy
2.4 Consolidation in
the banking system
2.5 Capital base and
3.1 Methods of data
encountered in data collection
CHAPTER FOUR: DATA
ANALYSIS AND DISCUSSION OF THE RESULTS
4.1 Data analysis
4.2 Discussion of
CHAPTER FIVE: SUMMARY,
CONCLUSION AND RECOMMENDATION
Public finance is a field of
economics concerned with how government raises money, how that money is spent
and the effect of these activities on the economy and on the society.
Expenditure and revenue of the
country fall under the topic, public finance. However, in a developing economy
like Nigeria, management of moderate deficit financing is tailored toward
useful and development oriented projects. This necessitated me to focus
attention on the amount of expenditure and revenue generated in Nigeria over
the past years.
Government generates revenue from
various economic sectors: these are divided into oil and non-oil revenue:
1. Oil Revenue: This is the revenue generated from
oil sectors of the economy which comprise:
profit tax and royalties
which include revenue from export sales, domestics sales, tax on petroleum
products, rents etc.
2. Non Oil Revenue: This is revenue generated from other
sectors of the economy other than the oil sector which comprises of:
a. Company income tax
b. Custom and exercise duties
c. Value added tax (V.A.T)
d. Federal government independent
revenue which comprises revenue from interest payments rents on government
properties, personal income tax of armed forces, police, external affair and
federal capital residents
e. Other which include custom levies,
education tax etc.
The revenue generated from different
sectors of the economy is allocated to:
accounts which include transfer to federation accounts from domestic oil sales
added tax (VAT) pool accounts
debt service funds
priority projects fund
which include transfers to special and excess reserves and education fund
The revenue generated from various
sectors of the economy is spent on:
1. Administration which comprises of:
a. General administration
c. Internal security
d. National assembly
2. Economic services which include
b. Roads and construction
c. Transport and communication
d. Other economic services
3. Social and community services which
a. Public debt charges
d. Pension and gratuities
e. F.C.T and others
1.1 HISTORICAL BACKGROUND OF THE STUDY
The National Bureau of statistics
(NBS) has a humble beginning starting in 1928 as a statistics unit in the
office of the colonial secretary in the cabinet secretariat of British Colonial
In 1947 a more focused reorganization
took place with the establishment of a statistics section in the department of
customs and exercise which later metamorphosed into a full pledged department
In 1949, the departments
responsibilities were expanded to form the nucleus of a centralized national
statistics office for the country with the adoption of the federal system of
government in 1968 central and the regional government had their statistics
establishments incorporated into a decentralized National Statistics System
(NSS). A legal frame work for statistics operation in Nigeria was unable with
the statistics act of 1937. The act gave backing for a decentralized
statistical system but advocated collaboration between the central and regional
statistical office in addition to co-ordinate their activities.
At independence in 1960, the
department of statistics was moved from customs and excuse to the Federal
Ministry of Economic Development with its name changed to the federal office of
statistics (FOS) in the 1980s further re-organization of the Nigeria statistics
system (NSS) led to the Central Bank of Nigeria taking on the collection of
financial statistics and the National Population Commission given the
responsibility of population statistics including the conduct of census length
and collection of vital statistics like birth and death registrations and
immigration statistics, as well as the conduct of demography and health
In 1989, a wholly computerized data
management agency was established called National Data Bank (NDB). NDB is a
data house, was designed to hold time series data dating back to 1914 when
Nigeria was created. The agencies FOS and NDB maintained a complex and over
lapping relationship with other members of the National Statistical Offices
(NSO) itself. Reforms started the repositioning of the federal office of
statistics (FOS) in 2004 when it was merged with the National Data Bank. The
reforms in driver by the statistical master plan (SMP) produced by the Federal
Government of Nigeria with assistance from the World Bank.
The merged of FOS and NDB led to the
establishment of the National Bureau of Statistics (NBS) to give the agency a
National Bureau of Statistics (NBS) to give the agency a National outlook as
the apex statistical agency for all the three tiers of government. NBS is
expected to co-ordinate system of the production of official statistics all the
federal ministries departments and agencies (MDAS), state statistical agencies
(SAS) and local government council (LGC). The 1957 statistics act has been
repeated and a new bill has been passed to give NBS a legal backing.
1.2 AIM OF THE STUDY
To conduct a statistical study into
public finance of the federation, that is revenue and expenditure of the
federal government of Nigeria (2003-2008) using regression analysis.
1.3 OBJECTIVES OF THE STUDY
1. To have an insight of the amount of
revenue generated and expenditure for the period of 2000-2011
2. To show the relationship between
revenue and expenditure using correlations analysis
3. To determine the degree of the
occurrence between expenditure and revenue using correlation analysis.
4. To forecast for future revenue and
expenditure using time series analysis
5. To make necessary recommendation on
1.4 SCOPE OF THE STUDY
The study will be based only on the
revenue and expenditure of the federal government for the period. The data on
this project work is given in billions of Naira and it is only an annual basis.
Data refers to the collection of
specific information, it is collected to enable the researcher understand the
environment under study and to achieve specific objective.
The data in this project work
collected from National Bureau of Statistics (NBS). It is a secondary data
extracted from their statistical bulletin.
1.5 DEFINITION OF TERMS
Public Finance: This is a field of economics
concerned with how government raises money, how that is spent, and the effects
of these activities on the economy and on the society.
Budget: This is a forecast of expenditure
and revenue for a specific period of tie.
Revenue: This is the income of a government
from all sources, used to pay for a nation’s expenses.
Recurrent revenue: This includes tax receipts and
non-tax receipts within the fiscal year.
Capita revenue: This covers receipts from non
financial assets used in production for more than one year.
Expenditure: This is an outflow of resource from
government to other sectors of the economy, whether required or unrequested.
Recurrent expenditure: Are payments for non-payable
transaction within one year.
Capital expenditure: Are payments for non-financial
assets used in production process for more than one year.