The Nigerian Senate yesterday defended the federal government’s continued reliance on borrowing, emphasizing that deficit financing is inevitable to fund the proposed N58.47 trillion 2026 Appropriation Bill, which carries an estimated deficit of N25.91 trillion amid limited revenue and vast development needs.
At a public hearing on the 2026 budget, Minister of Industry, Trade and Investment, Mrs. Jumoke Oduwole, raised concerns over her ministry’s proposed N2.72 billion capital allocation, describing it as insufficient to implement the scale of programmes necessary to drive industrialisation, trade growth, and investment attraction.
Senator Solomon Adeola, Chairman of the Senate Committee on Appropriations, said Nigeria cannot meet its infrastructure, security, and social obligations without borrowing, but stressed that the era of wasteful, consumption-driven deficits must end. “The issue is not borrowing itself, but how deficits are funded and how borrowed resources are utilised,” he explained.
Adeola disclosed that projected revenue for 2026 stands at N33.19 trillion, while total expenditure is estimated at N58.47 trillion, leaving a deficit of N25.27 trillion, with debt service expected to consume about N15.90 trillion. He highlighted the need for revenue expansion, asset optimisation, and stricter fiscal discipline, noting that excessive domestic borrowing, which could crowd out private sector credit, is being avoided in favour of a mix of external financing, asset sales, Public-Private Partnerships (PPPs), and infrastructure concessioning.
The senator also called for complete removal of electricity subsidies to free resources for development, warning that partial reforms would continue to drain public finances. He credited President Bola Tinubu’s removal of fuel subsidies as a key turning point in ongoing fiscal reforms.
Adeola further vowed that the National Assembly would no longer approve budget extensions, citing repeated rollovers as a major cause of poor budget outcomes.
Represented by Deputy Senate President Senator Barau Jibrin, Senate President Godswill Akpabio described the 2026 budget as a moral and historical test for the nation, urging that borrowed funds be converted into tangible benefits for citizens.
Minister of State for Finance, Dr. Doris Nkiruka Uzoka-Anite, said the budget aligns with government priorities, deepens ongoing reforms, and ensures that limited resources are used efficiently. Fiscal policy expert Dr. Olatilewa Adebajo warned that rising deficits could become unsustainable without urgent measures to strengthen revenue mobilisation and enforce the Fiscal Responsibility Act (FRA).
Accountant General Shamseldeen Olujimi stressed that the success of the budget should be measured by the impact on citizens—functioning schools, operational health centres, reliable power, and job creation—rather than allocations alone. Adeola assured lawmakers that all funds would remain subject to National Assembly oversight, with reallocations possible for MDAs that fail to defend their budgets.
Mrs. Oduwole appealed for increased capital funding for her ministry, highlighting its central role in economic diversification, non-oil export growth, domestic production, and investment attraction. She stressed that the proposed N2.72 billion allocation is insufficient for delivering the ministry’s mandate, including support for the Renewed Hope Agenda and the administration’s trillion-dollar economy target.
Senator Umar Sadiq, Chairman of the Senate Committee on Trade and Investment, noted that a strong performance from the ministry is essential for achieving the $1 trillion economic goal. Senator Francis Fadahunsi, Chairman of the Senate Committee on Industry, urged the ministry to demonstrate tangible impacts on job creation, industrial growth, and export expansion.
Oduwole highlighted the ministry’s achievements over the past two years, including $21 billion in capital importation in the first ten months of 2025—up from $12 billion in 2024 and under $4 billion in 2023—crediting sector interventions such as bankable investment projects, sector-focused deal rooms, the Domestic Investor Summit, and over 100 bilateral engagements with countries including the UK, US, UAE, Brazil, and Japan.
She stressed that these results justify a targeted increase in capital allocation to enable the ministry to fully deliver on its mandate and support Nigeria’s economic transformation.
