Senate mulls 2026 budget cut over unrealistic assumptions

The Nigerian Senate on Tuesday engaged in a rigorous examination of the President’s economic team, spotlighting poor implementation of the 2025 budget and questioning the realism of revenue assumptions behind the proposed ₦58.7 trillion 2026 budget, with lawmakers considering a reduction in the latter. The tense budget defence session before the Senate Committee on Appropriations revealed deep dissatisfaction over fiscal management.

Senators voiced concerns about widespread non-funding of the 2025 budget by Ministries, Departments and Agencies (MDAs), describing the session as one of the worst in recent times. Key issues cited included unpaid contractors, a controversial centralized payment system causing disbursement delays, inadequate capital releases for infrastructure, and a rising national debt profile. These challenges have hindered public projects and strained economic activity.

Initially, Minister of Finance and Coordinating Minister of the Economy Wale Edun faced criticism for his responses, leading the committee to summon Zacch Adedeji, Chairman of the National Revenue Service. Adedeji acknowledged that previous budgets often relied on faulty assumptions, noting that unrealistic projections consistently created implementation hurdles. “When assumptions are not real, there will be a problem. That is what we intend to correct this year. It must be based on realistic budgeting. Efficiency lies in what you can actually execute,” he said, advocating for credible revenue forecasts.

Committee Chairman Senator Adeola Olamilekan pressed the economic team on their confidence in the 2026 proposal. “The indication is that you do not have full confidence in the ₦58.7 trillion budget. Do we reduce this budget or leave it as it is? If it is faulty and we are not reducing it, then you are saying you will meet it?” This query highlighted a fundamental disconnect between expenditure plans and potential revenue.

In response to queries on 2025 performance, the Minister of State for Finance disclosed that the Federal Government is prepared to settle outstanding payments. She announced that MDAs have been directed to upload cash plans for all pending obligations immediately, with payments to commence by Monday at the latest, aiming to resolve cash flow crises.

Following these exchanges, the committee adjourned into a closed-door session for further scrutiny. The Senate’s intense questioning underscores growing demands for fiscal discipline as Nigeria grapples with economic pressures, including inflation and revenue shortfalls. The potential trimming of the 2026 budget could reshape national spending priorities, emphasizing alignment between revenue projections and executable plans. Final decisions by the National Assembly will significantly influence Nigeria’s fiscal trajectory and public investment in the coming year.