The Nigerian Senate has warned it could significantly cut the proposed N58.472 trillion 2026 Appropriation Bill, citing unrealistic revenue projections, escalating national debt, and consistently low capital budget execution.
In a heated session with the Senate Committee on Appropriations chaired by Senator Olamilekan Adeola, lawmakers challenged the federal economic team, including Finance Minister Wale Edun and Nigeria Revenue Service Chairman Dr. Zacch Adedeji, on the feasibility of the ambitious figures.
Adeola pointed to historical shortfalls in oil revenue, where actual collections have often hit only 18% or 36.5% of targets, and questioned the realism of current benchmarks. “Do we reduce this N58.472 trillion budget or proceed and make adjustments?” he asked, emphasizing that high debt servicing already limits fiscal room.
Major concerns include:
National debt approaching N152 trillion, with debt service consuming a large portion of revenue.
Poor track record of capital project implementation in 2024 and 2025 budgets, leaving many initiatives stalled.
Overly optimistic revenue forecasts, especially from oil, amid production volatility and global market uncertainties.
Adedeji stressed the importance of realistic planning, noting that “budget efficiency is not in the size of the budget; it is in what you can implement.” He highlighted that under the Petroleum Industry Act, government oil revenue primarily comes from taxes and royalties—around 47% of output.
Edun described the targets as “stretch goals” to boost performance, while citing positive economic trends like ~4% growth, moderating inflation, rising reserves, exchange rate stability, and renewed investor confidence, including Shell’s $20 billion commitment.
Despite these defenses, the Senate remained skeptical without stronger assurances. Suggestions included selling strategic assets to ease debt pressures. Minister of State for Finance Dr. Doris Nkiruka Uzoka-Anite assured that outstanding capital releases from previous budgets would be completed by March 31, 2026, with MDAs submitting cash-backed plans.
After nearly two hours of closed-door talks, the session highlighted heightened legislative focus on fiscal prudence as Nigeria grapples with debt challenges and the need for credible, implementable budgeting.
The Senate indicated it will not approve the proposal unchanged, likely demanding revisions to match realistic revenue and execution capacity.
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