Former Vice President and 2023 presidential candidate of the Peoples Democratic Party (PDP), Atiku Abubakar, has criticized the 2025 budget proposal presented by President Bola Ahmed Tinubu, describing it as insufficient to address Nigeria’s pressing economic challenges. Atiku labeled the budget a continuation of “business-as-usual fiscal practices” and called for structural reforms to foster sustainable growth.
Key Concerns with the 2025 Budget
Atiku raised several issues regarding the proposed N49.7 trillion budget, which includes allocations such as:
- Defence and security: N4.91 trillion
- Infrastructure: N4.06 trillion
- Education: N3.52 trillion
- Health: N2.4 trillion
Despite these allocations, he argued the budget lacks the capacity to tackle Nigeria’s economic issues due to persistent deficits, unsustainable borrowing, and inadequate capital investments.
Specific Criticisms
- Rising Budget Deficit and Borrowing
Atiku highlighted the N13 trillion deficit (4% of GDP) in the budget, noting it will be funded by over N13 trillion in fresh loans, including N9 trillion in direct borrowing and N4 trillion in project-specific loans. He warned this strategy mirrors past approaches, leading to an unsustainable debt burden and rising risks from interest payments and foreign exchange exposure. - Debt Servicing vs. Developmental Spending
He criticized the disproportionate allocation of N15.8 trillion (33% of total expenditure) to debt servicing, which nearly matches the N16 trillion allocated to capital expenditures. He added that debt servicing outweighs spending on priority sectors such as defence, infrastructure, education, and health, crowding out investments critical for development. - Inefficient Government Spending
Atiku noted that recurrent expenditure, amounting to over N14 trillion (30% of the budget), reflects an oversized bureaucracy and inefficient public enterprises. He called for measures to curb wastage and enhance spending efficiency. - Insufficient Capital Allocation
With only 25%-34% of the budget allocated to capital projects, Atiku argued that the funding is insufficient to address Nigeria’s infrastructure deficit or stimulate economic growth. He estimated the per capita capital investment at approximately N80,000 (US$45), which he said is inadequate for a nation facing slow growth and underdevelopment. - Regressive Taxation Policies
Atiku criticized the government’s decision to increase VAT from 7.5% to 10%, calling it a retrogressive measure that would deepen the cost-of-living crisis and hinder economic growth. He argued that additional tax burdens on struggling citizens without addressing governance inefficiencies would stifle domestic consumption.
Call for Fiscal Reforms
In his statement, Atiku urged the administration to:
- Reduce inefficiencies in government operations.
- Address contract inflation.
- Shift towards disciplined, growth-oriented fiscal policies.
- Prioritize long-term fiscal sustainability over recurrent spending and borrowing.
He concluded that structural reforms and fiscal discipline are essential for Nigeria’s economic recovery, warning that the current budgetary approach would perpetuate the nation’s economic challenges rather than resolve them.
