The Senate and the House of Representatives have on Tuesday rescinded their decision on the passage of the 2025 budget bill, citing the need to correct errors in the allocations to capital and recurrent expenditures.
Despite the reversal, the overall budget size remains unchanged at N54.9 trillion.
The adjustment, which was prompted by a motion from Senator Adeola Olamilekan, Chairman of the Joint Committee on Appropriations, and Hon. Abubakar Kabir, Chairman of the House Appropriations Committee, led to a reallocation of funds.
The revised bill now allocates N13.588 trillion to recurrent expenditure, an increase of N524 billion, while capital expenditure has been reduced by the same amount to N23.439 trillion.
The National Assembly initially passed the budget on Thursday, February 13, with recurrent expenditure set at N13.064 trillion and capital expenditure at N23.963 trillion. However, upon further scrutiny, lawmakers identified discrepancies that required immediate rectification.
Reasons for the Adjustment
Legislative sources indicate that the changes stem from technical errors in the breakdown of allocations, particularly in priority sectors requiring additional funding for salaries, pensions, and overhead costs.
The need to balance spending efficiency with developmental projects also played a role in the revision process.
With the budget corrections now made, the bill is expected to be transmitted to President Bola Tinubu for assent in the coming days.
Budget Breakdowns
The breakdown of the 2025 budget as approved by the Senate is as follows:
- Total Expenditure: N54.99 trillion
- Statutory Transfers: N3.65 trillion
- Recurrent (Non-Debt) Expenditure: N13.64 trillion
- Capital Expenditure: N23.96 trillion
- Debt Servicing: N14.32 trillion
- Fiscal Deficit: N13.08 trillion
Initially, President Tinubu proposed a N49.7 trillion budget for 2025.
However, following additional revenue projections from key government agencies, the proposed figure was revised upward to N54.2 trillion on February 5, 2024.
The final approved budget stands at N54.99 trillion after deliberations in the National Assembly.
Sources of Additional Revenue
In a letter addressed to both the Senate and the House of Representatives, President Tinubu outlined the sources of the additional revenue:
- Federal Inland Revenue Service (FIRS): N1.4 trillion
- Nigeria Customs Service (NCS): N1.2 trillion
- Other Government Agencies: N1.8 trillion
These additional funds, he noted, would help bridge fiscal gaps and fund critical infrastructure projects.
More insights
President Tinubu assured Nigerians during the budget presentation of his commitment to reducing Nigeria’s inflation rate from 34.6% to 15% by the end of 2025.
Tinubu stated, “The 2025 budget projects that inflation will decline significantly from the current 34.6% to 15%,”.
“Also, the president promised to stabilise the exchange rate to N N1,500/$1. Tinubu noted
“Concurrently, the exchange rate will improve from approximately N1,700 per dollar to N1,500. These projections are critical for stabilizing the economy and ensuring sustainable growth.”
