The Senate on Thursday raised performance issues on the 2024 national budget and expectations from the yet-to-be-implemented 2025 budget.
Budget overlap in two consecutive fiscal years has cast doubts over the viability of the presentation of the 2026 Appropriation Bill to the National Assembly by President Bola Tinubu anytime soon.
The legislature had, in the past year, requested the President to be submitting budget proposal for a subsequent fiscal year to parliament by September of the current fiscal year.
Worried by the distortion of the budget cycle, the Senate, through its committee on Finance, has directed the President’s economic team to furnish it with a performance report on the 2024 budget within two weeks.
The lawmakers also demanded for report on expectation regarding the implementation of the capital component of the 2025 budget.
The chairman of the Senate Finance committee, Senator Sani Musa issued the directive after a closed door meeting with the government’s economic team.
The Minister of Finance, Wale Edun, who led the team, was accompanied by the Accountant General of the Federation, Samsudeen Ogunjimi and the Director – General of the Budget Office, Tanimu Yakubu.
Musa said his committee resolved that the presentation of the Medium Term Expenditure Framework ( MTEF) and Fiscal Strategy Paper ( FSP ) for 2026 to 2029 fiscal years, can only follow after the submission of reports on the 2024 and 2025 budgets.
Speaking earlier, Edun said the implementation of the capital component of the 2024 and 2025 budgets was high.
The Director General in the Budget Office, Yakubu said budget implementation was somewhat turbulent in 2024 and 2025, stressing that some of the underlying assumptions were not met.
He said, “We have indeed had a turbulent year — one in which most of the assumptions underpinning the 2024 and 2025 budgets turned out differently from projections.
“Oil revenue, assumed at $75 per barrel, fell short by between $10 and $15 due to global price fluctuations. Inflation also rose beyond projections, affecting borrowing costs and debt service performance, which significantly exceeded targets.
“Furthermore, the unforeseen fiscal implications of the Petroleum Industry Act (PIA) 2022 have compounded our challenges.
“Under the Act, 30 per cent of gross oil revenue and 30 per cent of oil and gas profits are retained for upstream operations, while the Federal Government also bears the NNPC’s operating costs. This has reduced the Federation Account allocation by nearly 70 per cent of what used to accrue.
“In addition, crude oil output has been lower than projected in the MTEF that was approved by the National Assembly”.
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