The Nigerian Senate has approved the 2025 Appropriation Bill, a significant budget totaling N54.9 trillion, following its third reading. The budget was presented by Senator Olamilekan Adeola, Chairman of the Senate Committee on Appropriation, who highlighted some of the major concerns that were raised during the review process. These included issues around inadequate funding for Ministries, Departments, and Agencies (MDAs), as well as the rising cost of governance and the depreciation of the naira.
The N54.9 trillion budget is a combination of both recurrent and capital expenditures, as well as debt servicing, all crucial for Nigeria’s development plans for the year. The major components of the budget are as follows:
– *Total Expenditure*: N54.9 trillion
– *Statutory Transfers*: N3.6 trillion
– *Recurrent Expenditure*: N13.6 trillion
– *Capital Expenditure*: N23.9 trillion
– *Debt Servicing*: N14.3 trillion
– *Fiscal Deficit*: N13.8 trillion
– *Deficit-to-GDP Ratio*: 1.52%
The budget also features a significant fiscal deficit, indicating that Nigeria is set to borrow N13.8 trillion to cover the gap between expected revenues and expenditures. This deficit is anticipated to represent 1.52% of the nation’s Gross Domestic Product (GDP).
Senator Adeola informed the Senate that the original proposed budget was N49.7 trillion but was revised to N54.9 trillion after consultations with President Bola Tinubu’s economic team. The increase was largely due to additional funds sourced from key federal agencies, including the Federal Inland Revenue Service (FIRS), the Nigeria Customs Service (NCS), and other government bodies. These additional funds were allocated to critical national projects and vaccine procurement, among other underfunded sectors.
Senator Adeola also noted the importance of adhering to a consistent budget cycle. He urged the executive arm of government to submit future budgets to the National Assembly at least three months before the start of the new fiscal year to allow for proper planning and smooth execution.
“The Nigerian government must ensure that future budgets are presented well ahead of time, so we can effectively plan and execute the necessary developmental projects,” Senator Adeola said.
A crucial part of the budget revision process was the involvement of several federal agencies that helped to boost Nigeria’s revenue generation. The Federal Inland Revenue Service (FIRS) has been allocated N1.4 trillion, while the Nigeria Customs Service (NCS) is expected to contribute N1.2 trillion. Other government agencies are expected to contribute N1.8 trillion. This additional funding will be used to support vital areas like infrastructure, health, and education.
These new revenue sources come at a time when Nigeria is facing an economic crisis characterised by a weak naira, high inflation, and an increasing cost of living. Despite the challenges, the government has emphasised its commitment to addressing the needs of Nigerians through the 2025 budget.
The legislative process surrounding the 2025 Appropriation Bill was thorough, with extensive debates and discussions from different stakeholders. The Senate first debated the bill on December 19, 2024, before referring it to the Appropriation Committee for further review. Following careful scrutiny and deliberation, the committee collaborated closely with the executive arm to ensure that the budget addressed key national priorities while remaining realistic in terms of available resources.
In his remarks, Senator Adeola stressed the importance of transparency in the budgeting process and urged government officials to ensure that allocated funds are judiciously spent. He pointed out that fiscal discipline would be crucial in achieving the budget’s goals, especially with the high debt servicing costs.
Following the passage of the 2025 budget, Senate President Godswill Akpabio expressed his appreciation for the hard work and dedication of both the Senate and House of Representatives Appropriation Committees. Akpabio specifically thanked Senator Olamilekan Adeola and the other members of the Appropriation Committee for their commitment to ensuring that the budget was aligned with the needs of the Nigerian people.
“The efforts of the Appropriations Committees in both the Senate and the House of Representatives should be commended. These committees represent almost two-thirds of the Senate, and their dedication to ensuring accountability and prudent fiscal management is commendable,” Akpabio said.
Akpabio also praised the collaborative efforts between the National Assembly and the executive branch, noting that working together was essential for ensuring that the budget reflected the needs and aspirations of the Nigerian people.
The increase in the total budget from N49.7 trillion to N54.9 trillion came after President Bola Ahmed Tinubu engaged with lawmakers and economic officials to reassess the government’s revenue projections. The revision was designed to accommodate additional funds generated by agencies such as the FIRS and NCS, helping to close the fiscal gap and ensure that essential services and projects would not be underfunded.
In separate letters to both the Senate and House of Representatives, President Tinubu explained that the adjustments were necessary to meet Nigeria’s evolving needs. The president acknowledged the fiscal challenges Nigeria faces but expressed confidence that the revised budget would help steer the country toward a path of greater economic stability and development.
Critics of the budget have expressed concerns about Nigeria’s increasing debt burden and the potential impact of the deficit on the economy. However, the government insists that the investments made through the budget will lead to long-term growth and stability.
