Experts Caution as Tinubu Increases 2025 Budget to N54.2 Trillion
The Federal Government has proposed a 9.1% increase in the 2025 budget, raising it from N49.7 trillion to N54.2 trillion. This move, announced through a letter from President Bola Ahmed Tinubu to the National Assembly, highlights the government’s plan to allocate an additional N4.53 trillion in revenue to various sectors.
Senate President Godswill Akpabio, who read Tinubu’s request during a plenary session, explained that the revenue increase comes from:
- Federal Inland Revenue Service (FIRS) – N1.4 trillion
- Nigeria Customs Service (NCS) – N1.2 trillion
- Government-Owned Enterprises (GOEs) – N1.8 trillion
The Senate Committee on Finance and Appropriations has been tasked with reviewing the proposal, with a plan to finalize and pass the budget by the end of the month.
Government’s Justification for the Budget Increase
President Tinubu emphasized that the additional revenue presents an opportunity to address critical national challenges and enhance development. The government plans to allocate the funds to key sectors, including:
- Solid Minerals Sector – N1 trillion to support economic diversification and harness Nigeria’s untapped mineral resources.
- Infrastructure Development aimed at strengthening key financial institutions like the Bank of Agriculture and Bank of Industry to drive economic growth.
Minister of Budget and Economic Planning Senator Atiku Bagudu stated that the decision followed detailed legislative scrutiny and recommendations from the Economic Management Team, which identified untapped revenue sources. He added that the Medium-Term Expenditure Framework (MTEF) would be adjusted accordingly to align with the budget expansion.
Experts Raise Concerns Over Fiscal Sustainability
Despite the government’s optimism, economic experts have expressed concerns about the potential risks associated with expanding the budget. Key issues raised include:
- Debt Sustainability: A larger budget may increase borrowing, leading to a higher debt burden.
- Inflationary Pressure: Increased government spending could further drive inflation, impacting cost of living.
- Effective Utilization of Funds: There are concerns about whether the additional funds will be efficiently allocated and managed.
Analysts warn that while increased revenue is promising, Nigeria must ensure fiscal discipline and transparency to prevent economic instability. As the National Assembly deliberates on the proposal, stakeholders continue to call for prudent financial management to balance growth with long-term sustainability.
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