Senate mulls cutting N58.472trillion 2026 budget, pronounces proposals unrealistic
The Senate has decided that there may be need to reduce the size of the 2026 Appropriation estimated at N58.472trillion.
The upper chamber raised the concern that the monetary allocations to various Ministries , Departments and Agencies ( MDAs) are unrealistic going by the yearly poor budget implementation largely characterised by zero or little releases of capital votes.
The Senate committee on Appropriations expressed the concerns during an interaction with the Nigerian economic team led by the minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun on Thursday at the National Assembly.
The Committee led by Senator Solomon Olamilekan Adeola (Ogun West) also raised concern over challenges concluding the capital component of 2024 and 2025 budgets by March 31, 2026.
The Committee was not satisfied with Edun’s response that the capital component of 2024 and 2025 budgets , are still being funded.
The Chairman of Nigeria Revenue Service ( NRS ) , Dr Zacch Adedeji however said that unrealistic budget assumptions cannot translate into realistic budget implementation .
“Budget funding must come from realistic projections. Efficiency is not about the size of the budget but about how much can actually be implemented.
” If you think you have ten units and spend accordingly, that is manageable. But if you assume you have one hundred and spend based on that assumption, you may run into serious problems if the funds do not materialize”, he said .
But the committee through the Chairman , Senator Adeola , reminded the NRS boss that budget documents originated from the Executive which NRS is part of .
“This document before us originated from the executive. The projections and challenges came from the executive arm, not the legislature. The gap between projected and realized oil revenue is wide.
“For example, how do we explain 18 percent performance in one year and projections of 36.5 percent the next year when actual performance is still below expectations?
“So the question is: Do we reduce the N58.472trillion 2026 budget, or do we proceed and make adjustments? Debt financing is already high. If certain assets were disposed of and used to reduce debt, two things would happen: the overall debt stock would reduce, and future borrowing costs could also decline”, he said .
In her response, the Minister of State for Finance , Dr. Doris Nkiruka Uzoka-Anite, on the full implementation of the 30% capital component of the 2025 budget and 2024 budget assured the committee that the implementation shall be completed before 31st March 2026.
She said : “Regarding the 2025 budget, funding processes are beginning. Payments for outstanding 2024 capital projects start today.
“The financial management system is back online. For 2025, MDAs have been asked to upload their cash plans by Monday, after which payments will commence. We are ready to start, but the MDAs must complete their documentation requirements”.
The committee thereafter went into closed door session with the Economic team which lasted for about two hours .
The Minister of Budget and Economic Planning , Senator Atiku Bagudu and the Accountant General of the Federation , Shamsedeen Babatunde Ogunjimi , also attended the session. .
