FORMER Vice President Atiku Abubakar has criticised the Federal Government’s 2025 budget, describing it as lacking the structural reforms and fiscal discipline needed to address Nigeria’s deep-rooted economic challenges.
In a statement on Sunday, December 22, Abubakar argued that the N48 trillion budget reflected a continuation of flawed fiscal practices, including excessive borrowing and inefficient expenditure by the Nigerian government, headed by President Bola Tinubu.
According to him, the budget, which he said projected revenue of N35 trillion and a deficit of over N13 trillion, relies heavily on new borrowings to bridge the gap.
The ICIR on Wednesday, December 18, reported that Tinubu presented Nigeria’s 2025 budget to a joint session of the National Assembly with key highlights, adjusting the exchange rate benchmark to N1,500 per dollar.
Christened ‘Budget of Restoration: Securing Peace, Rebuilding Prosperity,’ Tinubu presented a budget size of N47.9 trillion to the lawmakers.
He said the 2025 budget sought to consolidate the key policies his administration had instituted to restructure the nation’s economy and boost human capital development, increase the volume of trade and investments, and bolster oil and gas production, among others.
However, Abubakar noted that the administration’s plan to secure more than N13 trillion in loans, including N9 trillion in direct borrowings and N4 trillion in project-specific financing, mirrored past practices under the All Progressives Congress (APC)-led government that has contributed to Nigeria’s rising public debt and economic vulnerabilities.
“The 2025 federal budget, amounting to N48 trillion with a revenue forecast of N35 trillion, resulting in a deficit exceeding N13 trillion or four per cent of GDP, reflects a continuation of business-as-usual fiscal practices. This represents a persistent trend under the APC-led administration since 2016, wherein budget deficits have been consistently presented, accompanied by an increasing reliance on external borrowing.
“To bridge this fiscal gap, the administration plans to secure over N13 trillion in new borrowings, including N9 trillion in direct borrowings and N4 trillion in project-specific loans. This borrowing strategy mirrors the approach of previous administrations, resulting in rising public debt and exacerbating the attendant risks related to interest payments and foreign exchange exposure,” the People’s Democratic Party (PDP) presidential candidate in the 2023 election that brought Tinubu into office said.
He also faulted the administration’s plan to spend N15.8 trillion on debt servicing, noting that it equated to nearly N16 trillion planned for capital expenditure.
He argued that this imbalance crowds out critical investments in infrastructure and key sectors like defence, health, and education.
He also criticised the government’s recurrent expenditure, which he said stood at over N14 trillion, or 30 per cent of the budget, as a sign of inefficiency.
“The government’s recurrent expenditure remains disproportionately high, with over N14 trillion (30 per cent of the budget) allocated to operating an oversized bureaucracy and supporting inefficient public enterprises. The lack of concrete steps to curb wastage and enhance the efficiency of public spending exacerbates the fiscal challenges, leaving limited resources for development.”
He slammed the administration’s decision to increase the value-added tax (VAT) rate from 7.5 per cent to 10 per cent, describing it as a regressive policy that would worsen the cost-of-living crisis.
He stressed that raising taxes without addressing governance inefficiencies would stifle economic growth and deepen hardships for Nigerians.
Abubakar cited the ‘poor implementation’ of the 2024 budget as a warning sign, noting that less than 35 per cent of the allocated capital expenditure for ministries, departments, and agencies was disbursed by the third quarter, despite claims of 85 per cent execution.
Calling for urgent reforms, Abubakar emphasised the need to reduce inefficiencies in government operations, curb wasteful spending, and focus on sustainable fiscal policies.
Usman Mustapha is a solution journalist with International Centre for Investigative Reporting. You can easily reach him via: umustapha@icirnigeria.com. He tweets @UsmanMustapha_M