The senate has passed the 2026–2028 medium-term expenditure framework (MTEF) and fiscal strategy paper (FSP), paving the way for President Bola Tinubu to present the 2026 appropriation bill estimated at N54.4 trillion.
Senate President Godswill Akpabio announced the passage on
Tuesday after lawmakers considered the report of the senate committee on
finance.
The report was presented by Sani Musa, senator representing
Niger east and chairman of the committee.
The Musa-led committee had on Monday, faulted the
implementation of multiple budgets in a single fiscal year, citing the federal
government’s experience in 2025.
Committee members also asked the Federal Inland Revenue
Service (FIRS) to raise its projected revenue target for 2026 to N35 trillion
from N31 trillion.
OIL PRICE BENCHMARK, PRODUCTION TARGETS
Lawmakers said the approved parameters were aimed at
promoting macroeconomic stability, strengthening fiscal discipline and
supporting the federal government’s economic reforms.
The senate approved a downward review of the crude oil
benchmark price for 2026 to $60 per barrel, from $64.85.
However, lawmakers endorsed oil price benchmarks of $65 per
barrel for 2027 and $70 per barrel for 2028.
The committee said the conservative adjustment for 2026 was
due to heightened geopolitical tensions in Europe and the Middle East, as well
as continued volatility in the global oil market.
Despite the cautious price outlook, the senate retained
crude oil production projections of 1.84 million barrels per day for 2026, 1.88
million barrels per day for 2027 and 1.92 million barrels per day for 2028.
Lawmakers expressed optimism that improved security,
industry reforms and increased investment would support higher output.
EXCHANGE RATE, INFLATION, GDP GROWTH
On exchange rate assumptions, the senate approved
projections of N1,512 to the dollar for 2026, N1,432.15/$ for 2027 and
N1,383.18/$ for 2028.
The upper chamber said the figures align with the Central
Bank of Nigeria’s (CBN) policy direction and efforts to stabilise the naira
through improved coordination of fiscal and monetary policies.
The senate also approved inflation projections of 16.5
percent for 2026, 13 percent for 2027 and 9 percent for 2028.
Lawmakers said the outlook reflects expected tightening
measures by monetary authorities.
Real gross domestic product growth projections of 4.68
percent for 2026, 5.96 percent for 2027 and 7.9 percent for 2028 were also
retained.
Senators expressed confidence that recent tax and structural
reforms would begin to deliver measurable economic benefits from 2026.
REVENUE MEASURES AND TAX REFORMS
To boost revenues, the senate urged the strict
implementation of newly enacted tax laws.
Lawmakers described the tax reforms as critical to economic
growth and development.
The upper chamber also recommended the adoption of a
national scanning policy under the national single window of the Nigeria
Revenue Service to curb leakages, improve trade facilitation, boost
transparency and enhance national security.
On fiscal aggregates, the senate approved a total federal
budget size of N54.46 trillion for 2026.
The figure comprises retained revenue of N34.33 trillion and
new borrowings of N17.88 trillion from domestic and external sources.
Debt service was pegged at N15.52 trillion.
Pensions, gratuities and retirees’ benefits were estimated
at N1.37 trillion.
The framework also includes an overall fiscal deficit of
N20.13 trillion.
Lawmakers endorsed capital expenditure of N20.13 trillion,
statutory transfers of N3.15 trillion, a sinking fund of N388.54 billion and
recurrent non-debt spending of N15.265 trillion.
The committee thanked the senate for its support and
expressed optimism that the approved framework would support sustainable
economic growth and long-term prosperity.
‘FURTHER REVIEWS COULD BE MADE’
Akpabio said the MTEF is a statutory prerequisite for the
presentation of the national budget and does not represent the final position
of the legislature.
“The medium-term expenditure framework is only a
prerequisite before the presentation of the budget,” he said.
“What we are discussing here is not a finality. If
circumstances change, it will be brought back to us to rejig, react or act.”
Akpabio said the approval of the framework would enable the
national assembly to receive the 2026 budget proposal within the week.
He added that the MTEF is not set in stone, noting that
further reviews could be made when the budget is formally presented.
The senate president expressed hope that the projections
contained in the framework would be realistic enough to support the
implementation of the renewed hope agenda.
Tahir Monguno, senate chief whip and senator representing
Borno north, said the MTEF clearly outlined key fiscal parameters, which he
described as realistic.
Monguno said the projected crude oil production benchmark of
1.84 million barrels per day was achievable.
He also described the reduction of the oil price benchmark
to $60 per barrel from $64 as prudent, given current market realities.
Following the debate, the senate adopted the recommendations
contained in the MTEF/FSP report through a voice vote.
The upper chamber had received the 2026–2028 MTEF and FSP
from Tinubu on December 11, signalling the start of the 2026 budget cycle.
In a letter addressed to lawmakers, the president said the
submission complied with statutory requirements and outlined the fiscal
parameters for the preparation of the 2026 appropriation bill.
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