FG breaks silence on ₦8tn spending row, denies operating ‘Shadow Budget’

By Kazeem Ugbodaga

The Federal Government has rejected claims that it spent more than ₦8 trillion outside the 2025 Appropriation Act, describing the allegations as inaccurate and a misrepresentation of observations contained in the International Monetary Fund (IMF) 2026 Article IV Consultation Report.

In a statement issued on Sunday, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said recent public commentary suggesting that about two per cent of Nigeria’s Gross Domestic Product (GDP) was expended outside the approved budget was misleading and failed to reflect the country’s constitutional and fiscal framework.

According to the minister, the Federal Government does not operate a “shadow budget” or spend public funds outside the legal processes established by the Constitution and the National Assembly.

He explained that all federal expenditures are undertaken in accordance with the provisions of Sections 80 to 83 and 162 of the 1999 Constitution, as amended, through duly enacted Appropriation Acts, Supplementary Appropriation Acts and other statutory authorisations approved by lawmakers.

Oyedele noted that some capital projects span multiple fiscal years and are implemented through legally recognised capital rollovers, stressing that such arrangements should not be interpreted as unapproved or illegal spending.

“It is inaccurate to suggest that trillions of naira have been secretly spent outside legislative approval,” he said, adding that allegations of unlawful expenditure should be backed by credible evidence identifying specific projects executed without appropriation.

The minister said it was important to distinguish between budget appropriation, expenditure authorisation, financing mechanisms and fiscal reporting, noting that Nigeria’s public finance framework includes several statutory transfers and intervention mechanisms established by Acts of the National Assembly.

These, he said, include statutory allocations to development commissions and government agencies, revenue collection costs retained under existing laws, separately approved capital budgets for certain agencies and the Federal Capital Territory, special interventions for national priorities such as security, infrastructure and disaster response, as well as debt servicing obligations.

According to him, these expenditures are lawful, disclosed in government fiscal reports and subject to oversight, auditing and accountability mechanisms, even if their presentation differs under international fiscal reporting standards.

The minister also dismissed suggestions that the reported amount reflected an increase in Nigeria’s fiscal deficit, explaining that budget deficits are determined by the relationship between total government revenue and expenditure rather than by the financing structure of approved projects.

Oyedele argued that the IMF’s observations primarily related to the comprehensiveness, timing and presentation of fiscal reporting rather than the legality of government spending.

He recalled that President Bola Ahmed Tinubu had, while presenting the 2026 Appropriation Bill to the National Assembly on December 19, 2025, requested lawmakers to discontinue the practice of operating multiple and overlapping budgets and instead adopt a unified budget framework.

The minister maintained that the Federal Government remains committed to prudent fiscal management, transparency and accountability, adding that recent reforms have strengthened treasury management, revenue administration, digitalisation of public finance processes and budget credibility.

He said these reforms have been recognised by the IMF, other multilateral institutions, international credit rating agencies, investors and major global media organisations.

While acknowledging that public scrutiny is essential in a democracy, Oyedele urged Nigerians to base debates on verified facts and a proper understanding of the country’s fiscal framework.

He reaffirmed the government’s commitment to the rule of law, transparency in the management of public resources and continued collaboration with the National Assembly and oversight institutions to strengthen fiscal governance in line with international best practices.