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President Bola Tinubu is expected to present the 2025 Appropriation Bill to the National Assembly today.
The budget has a proposed budget size of N47.9 trillion and new borrowings of N9.22 trillion. The Medium-Term Expenditure Framework (MTEF) for 2025-2027 and the Fiscal Strategy Paper was approved on Thursday by the Federal Executive Council.
According to the Minister of Budget and Economic Planning, Abubakar Bagudu, the MTEF sets out parameters including an oil price benchmark of $75 per barrel, an oil production target of 2.06 million barrels per day, an exchange rate of N1,400 to the US dollar, and a GDP growth rate of 4.6 percent. The projected aggregate expenditure for 2025 is N47.9 trillion, with planned borrowing of N13.8 trillion, equating to 3.87 percent of GDP.
“For the 2025-2027 period, the MTEF sets out parameters including an oil price benchmark of $75 per barrel for 2025, oil production of 2.06 million barrels a day, as well as an exchange rate of N1400 to the dollar and GDP growth of 4.6 per cent.
“It is expected that for 2025, the Federal Government’s budget estimate, the aggregate expenditure is estimated at N47tn, and this includes a borrowing of N13.8tn, which is 3.87 per cent of the estimated GDP.
“The budget size that was approved for presentation to the National Assembly in the MTEF is N47.9tn with new borrowings of N9.22tn to finance the budget deficit in 2025 as well as noting that we need to sustain the commendable market deregulation of petroleum prices and exchange rate, and to compel the Nigerian National Petroleum Corporation Limited to lower its oil and gas production cost significantly, and even to consider the need to amend the relevant sections of the Petroleum Industry Act 2021 to address the significant risk to Federation.”
“The figures were only for 2025, even though there are projections for 2026 and 2027 in the document, which have different figures for the oil price benchmark for the two years,” Bagudu explained.
The MTEF also includes a review of the 2024 budget implementation.
The actual spending as of August 2024 was N16.98 trillion, against the prorated spending target of N23.37 trillion. Debt service took N7.41 trillion, while personnel costs, including pension, took N3.7 trillion. Capital projects received N3.65 trillion.
He said, “Actual spending as of August 2024 ending was N16.98tn as against the prorated spending target of N23.37tn at the end.
“Of this amount, N7.41tn was for debt service, and N3.7tn for personnel costs including pension. Further, N3.65tn has been released for capital projects. Most of the delays for capital project release have been earlier legacy issues, in the sense that the new procedure for upload requires a lot of capacity building and delayed uploads.”
The National Assembly is expected to receive the MTEF today or on Monday, November 18.
“We are submitting it, I believe, tomorrow [Friday] or, at the latest, on Monday. The office of Mr President will forward the Medium-Term Expenditure Framework and Fiscal Strategy Paper to the National Assembly,” the minister stated.
Despite the late approval, the FG says it will maintain the January-December budget implementation cycle.
“We are confident because we have built a respectable relationship with the National Assembly. We have narrowed the areas of misunderstanding. And because of that mutual respect, Mr President is very transparent with the National Assembly leadership. And the National Assembly appreciates that openness.
“He [President] has instructed all his teams to ensure we cooperate with the National Assembly. For instance, the team led by the Coordinating Minister of the Economy has been mandated not only to wait but also to engage the National Assembly and answer all questions at the committee hearings.
“So, I’m confident because of this combination of factors. With this cooperation, I believe we’ll see an expeditious consideration, and immediately we are aware of the approval, we will finalise the budget because the MTEF precedes the budget preparation,” the minister disclosed.