By George Mgbeleke <\/p>\n
In an effort to flag-off the commencement of 2026 budget defence by Ministries, Departments and Agencies (MDAs) of government, the Senate on Monday declared that Nigeria would continue to borrow to bridge its massive budget deficit, even as it vowed to end the long-standing practice of rolling over unimplemented budgets and warned Ministries, Departments and Agencies (MDAs) to brace for stricter scrutiny.<\/p>\n
Chairman of the Senate Committee on Appropriations, Senator Solomon Olamilekan Adeola, made the position clear at the public hearing on the 2026 Appropriation Bill, stressing that borrowing had become unavoidable given the country\u2019s revenue constraints and huge development needs.<\/p>\n
Adeola, however, announced that the National Assembly would no longer approve extensions of budget implementation cycles, insisting that discipline, firm timelines and stronger oversight would henceforth define Nigeria\u2019s budgeting process.<\/p>\n
\u201cNever again will the National Assembly approve budget extensions. We must discipline our budgeting cycle, enforce strict adherence to appropriation timelines, and ensure better coordination between policy design and implementation,\u201d he said.<\/p>\n
According to him, while public opposition to borrowing persists, Nigeria\u2019s infrastructure gap and development challenges leave the government with little choice. <\/p>\n
He argued that the real issue was not borrowing itself, but how deficits are financed.<\/p>\n
\u201cNigeria cannot help but keep borrowing because revenue inflows are unpredictable and development needs are enormous. What matters is how we borrow and how we fund our deficits,\u201d Adeola said.<\/p>\n
He acknowledged the growing burden of debt servicing but maintained that Nigeria must honour its obligations to protect its credit rating and international standing. <\/p>\n
To avoid crowding out private sector credit, he said government was deliberately limiting domestic borrowing and exploring alternatives such as asset optimisation, privatisation, Public-Private Partnerships (PPPs), joint venture asset leveraging and Eurobond issuances.<\/p>\n
\u201cGovernment is deliberately avoiding excessive domestic borrowing that could crowd out private sector credit. Instead, we are exploring external financing, asset sales and privatisation to bridge revenue gaps,\u201d he added.<\/p>\n
Economist and fiscal policy expert, Dr. Olatilewa Adebanjo, warned at the hearing that Nigeria\u2019s rising budget deficit could become unsustainable without urgent reforms in revenue mobilisation and fiscal discipline. <\/p>\n
He called for a comprehensive review and stricter enforcement of the Fiscal Responsibility Act (FRA), describing it as a potent but underutilised law.<\/p>\n
\u201cWe need to remain alert and proactive. All stakeholders must closely monitor critical sectors to ensure revenues meant for government actually reach government coffers,\u201d Adebanjo said.<\/p>\n
He raised particular concern about the mining and solid minerals sector, alleging massive revenue leakages and accusing foreign interests, especially Chinese firms, of extracting Nigeria\u2019s resources with minimal benefit to the country.<\/p>\n
\u201cWhat we continue to see is a situation where foreign actors, especially Chinese interests, come into the country, extract our mineral resources and leave with enormous value, while Nigeria earns little or nothing in return. This is a wake-up call,\u201d he said.<\/p>\n
Adebanjo also criticised what he described as unrealistic revenue projections, urging government to base budgets on achievable figures and hold revenue-generating agencies accountable for performance.<\/p>\n
The Chief Commissioner of the Public Complaints Commission (PCC) also decried persistent waste in public spending, citing abandoned projects, inflated contracts and poor execution by MDAs as key drivers of fiscal stress.<\/p>\n
\u201cFunds are appropriated, yet outcomes are often disappointing. Strong oversight and accountability mechanisms are essential to derive full value from public spending,\u201d he said.<\/p>\n
In response, Adeola urged the executive to aggressively deploy PPPs, especially in infrastructure development, to ease pressure on public finances. He also insisted that electricity subsidies must be fully removed to unlock resources for development.<\/p>\n
\u201cTrillions of naira were spent annually on fuel subsidies, money that did not exist. We borrowed to fund it. The bold decision to remove subsidies laid the foundation for the reforms we see today,\u201d he said, adding that power sector reforms must be completed.<\/p>\n
On the 2026 budget, estimated at \u20a658.47 trillion, Adeola described it as a \u201cBudget of Consolidation,\u201d anchored on subsidy removal, tax reforms, public finance restructuring and electricity sector reforms. He warned that the success of the budget would depend on effective implementation and people-centred outcomes.<\/p>\n
He disclosed that projected revenue stood at \u20a633.19 trillion, leaving a deficit of about \u20a625.27 trillion. Debt service is estimated at \u20a615.90 trillion, while capital expenditure of \u20a623.21 trillion reflects government\u2019s focus on infrastructure and productivity.<\/p>\n
Key assumptions include an inflation target of 16.5 per cent, exchange rate stabilisation around \u20a61,400 to the dollar, oil production of 1.84 million barrels per day and a benchmark oil price of $64.85 per barrel. Priority allocations include \u20a65.41 trillion for defence and security, \u20a63.56 trillion for infrastructure, \u20a63.52 trillion for education and \u20a62.48 trillion for health.<\/p>\n
Adeola warned heads of MDAs to take budget defence seriously, noting that failure to justify proposals could lead to reallocations. He also reaffirmed that all government funds, including service-wide votes, remain subject to legislative oversight.<\/p>\n
Presenting his remarks, Accountant General of the Federation, Shamseldeen Olujimi, called for a shift from budget size to measurable impact, describing the budget as a \u201cmoral document\u201d that reflects national priorities.
\n\u201cFor too long, Nigeria has been strong on budget formulation but weak on budget translation,\u201d he said,
\n urging a focus on outcomes such as functional schools, operational hospitals, reliable power and job creation.<\/p>\n
Minister of State for Finance, Dr. Doris Nkiruka Uzoka-Anite, said the 2026 budget was designed to maximise scarce resources and deepen ongoing reforms. <\/p>\n
She acknowledged public frustration over rising living costs but described the outlook as \u201ccautious but positive,\u201d with GDP growth projected at about 4.5 per cent.<\/p>\n
Earlier, Senate President Godswill Akpabio, represented by Deputy Senate President Barau Jibrin, said budget hearings must go beyond ritual allocations to real impact.
\n\u201cOur task is not simply to spend more, but to spend better; not merely to allocate funds, but to convert budgets into outcomes,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"
By George Mgbeleke In an effort to flag-off the commencement of 2026 budget defence by Ministries, Departments and Agencies (MDAs) of government, the Senate on Monday declared that Nigeria would continue to borrow to bridge its massive budget deficit, even as it vowed to end the long-standing practice of rolling over unimplemented budgets and warned […]<\/p>\n","protected":false},"author":2,"featured_media":10970,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[3267,4049,6090],"class_list":["post-10963","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-economy","tag-borrowing","tag-stressing","tag-unavoidable"],"_links":{"self":[{"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/posts\/10963","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/comments?post=10963"}],"version-history":[{"count":1,"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/posts\/10963\/revisions"}],"predecessor-version":[{"id":10964,"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/posts\/10963\/revisions\/10964"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/media\/10970"}],"wp:attachment":[{"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/media?parent=10963"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/categories?post=10963"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dailyechoes.ng\/index.php\/wp-json\/wp\/v2\/tags?post=10963"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}