CBN’s loans will absorb N1.2 trillion of the 2023 budget.

The Federal Government has set aside more than N1.2 trillion to cover loans obtained from the Central Bank of Nigeria via the Ways and Means Act of 2023.

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The fiscal framework document for 2023, which Ripples Nigeria acquired, provided the specifics.

Subject to statutory limitations, the central bank can borrow money through a program called “Ways and Means Advances” to help finance the government during brief budgetary gaps.

Breakdown from the document showed the Federal Government allocated N6.31tn to service its total debts.

Out of the total amount N3.3tn will be use to service domestic debts, N1.81tn for foreign debts and N1.2tn for ways and means.

The document also showed that this was the first time the Federal Government was making a budgetary allocation for ways and means which has been a subject of controversies.

The federal government is currently owing CBN N22. 7 trillion and President Muhammdu Buhari recently sought the help of the National Assembly to convert the loan to a 40-year debt.

Buhari has failed to have his way as lawmakers raised concerns that the loan from CBN is not captured in the federal government debt plans over the years.

Should the lawmakers finally accept Buhari’s proposal, his administration would be leaving a whopping N77 trillion debt for the next government to pay.