2026 budget hangs in balance as FG admits deep revenue gaps, senators demand answers

Serious doubts have emerged over the credibility of Nigeria’s 2026 budget projections after the Federal Government admitted that it realised just ₦10 trillion out of the ₦40 trillion revenue targeted for the 2025 fiscal year, forcing senators to question persistent borrowing, overlapping budgets and weak capital project execution.

The concerns dominated an interactive session between the Senate Committee on Finance and the Federal Government’s economic management team on Monday in Abuja, as lawmakers began scrutiny of the 2026–2028 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP).

At the centre of the interrogation was Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, who acknowledged that revenue performance in both 2024 and 2025 fell significantly short of projections, creating structural pressure on budget implementation and spilling capital spending into subsequent years.

“We projected about ₦40 trillion in revenue for 2025, but actual federal government cash revenue is roughly ₦10 trillion,” Edun told senators.

Read also: 2026 budget: FG targets 2.06m bpd, $64 crude oil, N1,512/$1 exchange rate

“That gives us funding capacity for only about 30 per cent of the budget, meaning nearly 70 per cent of capital projects will roll over into 2026.”

The admission effectively confirmed that Nigeria is operating multiple budgets within a single fiscal year, an outcome senators across party lines described as unsustainable and unacceptable.

Former Gombe State governor, Senator Danjuma Goje, called the situation “ugly,” warning that it undermines fiscal discipline and public confidence.

“Are projects in the 2024 budget fully paid for? The 2025 budget has not really been implemented. How do we return to normal budgeting instead of running three budgets at the same time?” Goje asked.

Other lawmakers, including Senators Ireti Kingibe, Victor Umeh and Aminu Iya Abbas, pressed the finance team to explain how over ₦17 trillion borrowed within the first 10 months of 2025 was deployed, given the massive revenue shortfall and stalled capital projects.

Available data presented at the session showed that Nigeria borrowed about ₦17.36 trillion during the period, ₦15.8 trillion domestically and ₦1.56 trillion externally, raising fresh concerns about debt sustainability amid weak revenue inflows.

Edun also clarified President Bola Tinubu’s earlier claim that revenue targets had been met by August 2025, explaining that the statement referred strictly to non-oil revenue, not total government income.

“In 2024, we estimated revenue at ₦25.9 trillion, but actual receipts were about ₦8.27 trillion. In 2025, the pattern repeated,” Edun said. “This historical trend shows clearly that we must adopt a far more realistic revenue framework going into 2026.”

Senator Adams Oshiomhole added a labour-market dimension to the debate, warning that poor capital budget performance was choking job creation.

“How do we create jobs when capital projects are not implemented? Once the capital budget fails, the system fails to generate employment,” he said.

While defending the government’s approach, the Chairman of the Federal Inland Revenue Service, Zacch Adedeji, argued that budget revenues remain projections until cash is realised, noting that loans embedded in budgets do not automatically translate into available funds.

However, senators pushed back strongly, with the Senate Committee on Finance formally tasking the FIRS to raise its 2026 revenue target from ₦31 trillion to ₦35 trillion, signalling lawmakers’ insistence on more aggressive domestic revenue mobilisation.

Sani Musa, Committee chairman, said the Senate would not consider the 2026–2028 MTEF/FSP until a comprehensive public hearing is conducted to probe revenue performance for the 2024 and 2025 budgets.

“We must understand why revenues consistently underperform before projecting new figures for 2026,” Musa ruled, adding that a three-man ad hoc committee would engage the finance ministry and the Accountant-General to ensure contractors are paid for verified 2024 projects before the budget expires on December 31.

Under the proposed framework, the Federal Government plans a ₦54.5 trillion budget for 2026, with projected revenue of ₦34.33 trillion, implying a deficit of about ₦20 trillion and debt service obligations estimated at ₦15.9 trillion.

The MTEF assumes crude oil production of 1.84 million barrels per day at a benchmark price of $64.85 per barrel, an exchange rate of ₦1,512/$, and GDP growth of 4.68 per cent, assumptions defended by Edun, Budget Minister Atiku Bagudu and Petroleum Minister Heineken Lokpobiri.

But lawmakers remain unconvinced, especially given that the MTEF arrived late at the National Assembly, contrary to the Fiscal Responsibility Act timeline.

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