The Federal Government has boosted its 2025 Appropriation Bill from N49.7tn to N54.2tn after key agencies generated extra revenue.
In letters read on the floor of the Senate and the House, President Bola Tinubu explained that the increase is driven by additional funds from the Federal Inland Revenue Service (N1.4tn), the Nigeria Customs Service (N1.2tn), and other government agencies (N1.8tn).
The revised proposal builds on Tinubu’s original “Budget of Restoration: Securing Peace, Rebuilding Prosperity” presented in November.
The Federal Government projects a total revenue of N36.35tn for 2025, anchored on improved non-oil revenue, which includes enhanced tax collections, customs duties, and income from government-owned enterprises.
This comes alongside oil revenue forecasts based on a crude oil price of $75 per barrel, a production target of 2.06 million barrels per day, and an exchange rate of N1,500 per USD.
The original N49.7tn budget accounted for significant spending in critical sectors, targeting a fiscal deficit of N13.39tn (3.96% of GDP).
This deficit will be financed through a mix of domestic and external borrowings as well as public-private partnerships. The extra N4.5tn is expected to support the government’s diversification program, notably investments in the solid minerals sector and key infrastructure projects.
During a briefing, Minister of Budget and Economic Planning Atiku Bagudu explained that interactions between the executive and the National Assembly revealed that institutions like the Federal Inland Revenue Service and the Nigeria Customs Service could indeed generate more revenue than originally estimated.
The proposal has been referred to the Senate and House Committees on Finance and Appropriations for urgent consideration, with Senate President Godswill Akpabio assuring that the budget will be passed before the end of February.
Federal Government: The move, however, has drawn varied reactions from the Nigerian economy’s players. Economist Marcel Okeke slammed the rapid adjustment, arguing that a supplementary budget should have been prepared instead of making afterthought changes just one to two months before the budget came into effect. He added that rushing such adjustments could undermine the credibility of the figures already disseminated globally.
Federal Government: On the other hand, Chief Economist Paul Alaje expressed concerns that the increased spending might derail the government’s inflation target of 15%, while Tunde Amolegbe, Managing Director of Arthur Steven Asset Management Limited, welcomed the boost as a necessary step for improving Nigeria’s inadequate infrastructure.
Amolegbe cautioned, however, that monitoring debt-to-revenue and debt-to-GDP ratios is crucial to avoid over-leveraging.
Federal Government: House of Representatives spokesperson Akin Rotimi and Deputy spokesman Philip Agbese have both endorsed the proposal, highlighting its potential to strengthen sectors such as agriculture—through investments in the Bank of Agriculture—and national security, with plans to build new barracks for troops.
As lawmakers continue to scrutinize the proposal in committee, the debate over the timing and impact of this budget adjustment remains a key issue in Nigeria’s economic policy discussions.