The allocation for the power sector was raised to N1.90 trillion, up from the initially proposed N418.37 billion for 2025.

However, according to NESG’s recent report titled “2025 FGN Budget Analysis: Can the Budget Deliver Major Economic Boost?”, the increase is not enough to resolve current electricity tariff reforms.

The report also identified non-cost-reflective tariffs and poor revenue collection as key issues that have led to the collapse of several power distribution companies (DisCos).

Typically, the energy sector budget is intended to fund initiatives aimed at boosting infrastructure and improving overall performance.

Of the newly allocated amount, N810 billion is designated for meeting Nigeria’s funding obligations under the $1.74 billion World Bank Power Sector Recovery Programme (PSRP), which focuses on enhancing the technical and financial performance of electricity distribution companies.

In addition, N269.74 billion has been earmarked for special intervention projects aimed at addressing critical infrastructure deficits and expanding electricity distribution across the country.

Beyond these commitments, the federal government has also proposed various initiatives to strengthen the sector, including the establishment of mini-grids in educational institutions and the installation of solar-powered street lights.

Speaking on the longstanding challenges impeding progress in the sector, the NESG report stated:

“Nigeria has historically faced challenges in implementing power sector budgets due to bureaucratic inefficiencies, corruption, and delays in project execution. While the 2025 budget signals a strong commitment to improving the power sector, it lacks a clear accountability framework to ensure the timely and transparent execution of projects.”

The report stressed the need for a robust monitoring and evaluation mechanism to mitigate the risks of fund misallocation, project abandonment, and underperformance of initiatives. It also warned that without comprehensive reforms, the increased budget may have limited impact.

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Tinubu announced the budget increment in separate letters, which he forwarded to both the Senate and the House of Representatives yesterday.

Minister of Budget and National Planning, Senator Atiku Bagudu, explained that the increment was to allow for the approval of more revenue to strengthen the Bank of Agriculture and Bank of Industry.

Bagudu said the increase was also to support the administration’s diversification programme by putting more money in the solid minerals sector as well as infrastructure projects.

However, a member of the House of Representatives, Kingsley Chinda, faulted the procedure for the increment.

Chinda said the presentation from the executive should not have come in the form of a letter.

Tinubu’s letter was read during plenary in the Senate by Senate President Godswill Akpabio, and in the House of Representatives by Speaker Tajudeen Abbas.

Tinubu attributed the N4.53 trillion added to the appropriation bill to an increment in revenues recorded by some revenue-generating agencies of the federal government.

He said the increase arose from N1.4 trillion additional revenues made by the Federal Inland Revenue Service (FIRS); N1.2 trillion made by the Nigeria Customs Service; and N1.8 trillion generated by some other Government-owned Agencies (GOEs).

The Ministry of Solid Minerals Development was the highest beneficiary of the additional revenues, as it got N1 trillion.

The ministry, which has Mr. Dele Alake as minister, initially had N6 billion envelope from the Budget Office for the 2025 fiscal year before the National Assembly joint committee on Solid Minerals increased it to N9 billion.

The president of the senate after, reading the letter, consequently, directed the request to the Senate Committee on Appropriations for expeditious consideration.

Akpabio also declared that the budget consideration would be concluded and passed before the end of February.

Tinubu wrote in the letter, “I am writing to inform you of the availability of additional revenue amounting to N4,530,479,970,637 and to propose its allocation within the 2025 Appropriation Bill to enhance the budget’s responsiveness to the nation’s most pressing priorities and aspirations.

“This additional revenue, sourced from key agencies, represents a pivotal opportunity to address Nigeria’s critical challenges and advance its development agenda”

He said GOEs generated additional revenues of N1,823,879,970,637 while the FIRS raked in N1,497,600,000,000

Tinubu stated that the federal government’s 52 per cent share of the increase in revenue rose from N22.1 trillion to N25.1 trillion and put that of the NCS at N1,209,000,000,000

The federal government’s 52 percent share of the increase in revenue rose from N6.5 trillion to N9 trillion.

He said, “With this additional revenue, the 2025 appropriation bill’s total budget size will increase from N49.7 trillion to N54.2 trillion, demonstrating our commitment to inclusive growth and security.”

The president suggested the allocation of the proposed additional revenues to the Ministry of Solid Minerals Development, Bank of Agriculture, Bank of Industry, and other critical sectors.

Tinubu wrote,

“I propose that these funds be allocated to the following transformative expenditure areas: Solid Minerals Sector, N1 trillion to support economic diversification by unlocking the potential of Nigeria’s vast solid mineral resources, which remain an untapped revenue stream and a vital pillar of non-oil growth.

“Recapitalisation of the Bank of Agriculture (BoA) – N1.5 trillion. This is to transform Nigeria’s agricultural landscape, ensure food security and empower smallholder farmers and agribusinesses.

“Recapitalisation of the Bank of Industry (Bol) – N500 billion. This is to provide critical support to small and medium enterprises (SMEs), drive local manufacturing, and reduce dependence on imports.

“Critical Infrastructure Projects (RHID Fund) – N1.5 trillion. N380 billion will be allocated as irrigation development through River Basin Development Authorities.

“Transportation Infrastructure (roads and rail) N700 billion; N300 billion for the construction and rehabilitation of critical roads and N400 billion for light rail network development in urban centres.”

The president also suggested the allocation of N50 billion to Border Communities Infrastructure, N250 billion for Military Barracks Accommodation, and N120 billion for Military Aviation.

Justifying the allocation of N1 trillion to the solid minerals ministry, Tinubu said it would boost economic resilience and reduce reliance on the volatile oil sector by creating alternative revenue streams.

In addition, he said the proposal would ensure regional equity by encouraging development in resource-rich, underserved areas, and boosting rural economies.

He said it would also support the processing and export of minerals and increase foreign exchange earnings.

Tinubu said the Bank of Agriculture recapitalisation would empower smallholder farmers and agribusinesses to improve their access to affordable credit. It is also expected to enhance agricultural productivity and support agro-industrial value chains, he said.

Additionally, he said the bank’s recapitalisation would lead to export competitiveness by promoting the export of high-value crops and reducing pressure on the naira.

Similarly, the N500 billion meant for the Bank of Industry recapitalisation, according to the president, would provide affordable financing for innovation and entrepreneurship. He also said it would drive industrial growth and support local manufacturing by reducing unemployment and expanding the tax base through industrial expansion.

He stated in the letter,

“Military Aviation: N120 billion will modernise Nigeria’s aviation capabilities, ensuring the military remains responsive to emerging security challenges.

“A Philosophical Case for Military Expenditure:

“The foundation of a thriving nation lies in its ability to protect its citizens. No infrastructure, no innovation, and no progress can be enjoyed or sustained without security.

“The government has a constitutional obligation to secure lives and property, and military expenditure is not merely a fiscal decision – it is a moral imperative.

“By investing in our armed forces, we affirm our resolve to end terrorism, safeguard the dignity of our people, and create conditions for economic prosperity.

“This budget reflects not only our commitment to securing Nigeria today but to building a future where every citizen can live and thrive without fear.

“This allocation framework underscores the administration’s dedication to fostering inclusive growth, addressing security challenges, and building resilience into Nigeria’s economic fabric.”

He added, “These investments will promote stability by addressing critical infrastructure deficits, especially in underserved regions, and strengthening national security by investing in agriculture, solid minerals, and manufacturing and reducing over-reliance on oil revenues.

“Catalyse economic growth: By enhancing infrastructure, supporting SMEs, and unlocking Nigeria’s vast economic potential.

“I urge the National Assembly to adopt and integrate these proposals into the 2025 Appropriation Bill, reflecting our shared commitment to national development.

“Kindly let me know if additional information or clarification is required.”

Bagudu, who spoke to newsmen shortly after seeing off Tinubu en route to France at the presidential wing of Nnamdi Azikiwe Airport, Abuja, explained the reason behind the upward review.

He said, “You will recall Mr. President submitted N49 trillion budget to the National Assembly and legislative work commenced.

“The legislative work continued with interactions between the executive and the National Assembly. The National Assembly and the Economic Management Team continued to interrogate all figures.

“In that process, the Senate Committee on Appropriation, Senate Committee on National Planning, Senate Committee on Finance established that we can generate more revenue by tasking all the institutions to do more and the Federal Inland Revenue Service confirmed the ability to do more than was submitted.

“Equally, it was established that the government-owned enterprises can contribute more revenue, as well the customs service.

“So additional revenue amounting to over N4.5 trillion was established and this was taken to the president.”

Bagudu added that the adjustment of the Medium Term Expenditure Framework would follow.

He explained, “When the budget was submitted, MTEF was amended.

“The MTEF that was initially approved was for a budget of less than N49 trillion, so it goes together and so the consequential amendment to the MTEF will certainly follow.”

However, Chinda faulted the manner of increment of the 2025 appropriation bill.

Chinda said he was not against the budget increment, but was of the opinion that budget presentations from the executive should not come in the form of a letter.

But Deputy Speaker, Benjamin Kalu, maintained that he only read a letter from Tinubu, adding that the House, through Order 1, Rule 1, could regulate its proceeding.

Chinda said,

“I just listened to the deputy speaker present a very wonderful and beautiful budget speech. But I know that that is not a function of a parliamentarian, Mister Speaker. My point of order is changing Section 80…”

But Kalu interjected, insisting that he only read a letter and not a budget speech from the president.

Kalu stated, “Please, correct that, we did not lay the budget on behalf of the executive. The executive sent us a letter, and by our rules, we are supposed to read the letter of Mr. President.”

Chinda maintained that the budget being presented to the parliament ought not to come by way of a letter.

He maintained, “What I’m saying is that the budget being presented to parliament does not come by way of a letter. That is the essence of the objection. It comes under Section 83 of the Constitution, where the president will lay before parliament income and expenditure projection, which has been done earlier.

“And so what we got today as a letter, I don’t know where to classify it. The procedure might not be right. It is not just an addendum.

“My dear colleagues, recall that the 2024 budget is still running and has not been completed, and we are still crying for funds to fund the 2024 budget, and that is one of the reasons why we had to extend the lifespan.

“So, if we have additional funds, there are places to apply it, and it will still be to the credit of the country. And if we are in 2025, we project that we are going to get additional revenue, it is for us to look at the budget, apply it properly and send it back to the executive.”

Chinda further argued that whenever the executive presented a budget, by the time the legislature completes the consideration, a budget of N4 trillion could be increased to N5 trillion.

“But the process and procedure that we are adopting today is completely strange to me. It does not fall anywhere under either our constitution or the rules of the House,” Chinda maintained.

Nevertheless, Kalu stood his ground, saying the 2025 appropriation bill was still being considered by the National Assembly.

He stated, “Parliament functions through its committees. We cannot do the work of the appropriation committee during plenary. If there’s anything that has to do with the budget of the Federal Republic of Nigeria, and communication has been sent to us, it is our duty, especially with the power given to this chair by Order 2, Rule 2.”

Kalu then stated, “Minority Leader, can you read Order 1 Rule 2?

Kalu read, “The proceedings in the House of Representatives, particularly sub-rule two, in all cases, not provided for here and after or by Sectional or other orders, precedence or practices of the House by resolution regulate its procedure.”

[Source: ThisDay]

The post Why Tinubu Increased 2025 Budget to N54.2trn appeared first on Tech | Business | Economy.

The Senate Leader, Senator Opeyemi Bamidele, who presented the bill to the Senate said out of the N49.7 trillion budget, the sum of N4,435,761,358,925 only is for statutory transfers, N16,327,142,689,549 only is for debt service, N14,123,544,196,406 only is for recurrent (non-debt) ex­penditure while the sum of N14,853,717,110,517 is for con­tribution to the development fund for capital expenditure for the year ending December 31, 2025.

Senator Barau Jibrin, the deputy President of the Senate, in his contribution to the debate on the second reading of the 2025 budget commended President Bola Tinubu for “his political will to bring prosperity to this country.”

He said the 2025 budget christened ‘Budget of Restoration: Securing Peace, Re­building Prosperity’ is sine qua non for a sound economy and up-and-doing society.

“What we need to do after the passage is to make sure that we do all that is human­ly possible to ensure that it’s fully implemented. I’m sure by the time we implement this budget, this country will turn into a land of El Dorado, a land of plenty and prosper­ity,” he said.

Akpabio, in his final re­marks thanked his colleagues for their contributions to the general principles of the 2025 budgetary estimates.

He wished them a Merry Christmas and a very Happy New Year in advance, par­ticularly for the Christian brethren.

“And I also want to say that God Almighty and Almighty Allah will definitely bless your New Year. No tragedy will touch your families. You will go and come back in good health. And Almighty Allah, may God be with you and with your families. May you come back to continue the service to your fatherland”.

He charged those who are in charge of ad-hoc commit­tees that they must do their work, adding “as soon as we come back, please get your reports ready.

“Then those who are in charge of conference com­mittees, to ensure that we marry the petitions of both chambers together, get your reports ready. So that once we come back in January, we can get cracking.

“If there is a need to call you back, in line with legis­lative practice, while you are on holiday, we will do so. So don’t forget that you are like what they call it in the army, I think reservists. You are on reserve. You can be called back any time if there is need, so that we can convene in the national interest.”

Therefore, he adjourned the Senate to the 14th day of January, 2025.

Reps Pass N47.9trn 2025 Budget for Second Reading

Similarly, the House of Representatives, on Thursday, passed the N47.9 trillion 2025 Appropriation Bill for the second reading after a comprehensive debate on the general principles.

At the plenary session, Speaker Tajudeen Abbas commended the focus of the 2025 budget, emphasising the importance of ensuring accountability and effective implementation.

“This budget reflects our collective determination to lay a foundation for econom­ic recovery and national de­velopment,” Abbas said.

The Chairman of the House Committee on Appro­priations, Abubakar Kabir Bichi, highlighted the fiscal discipline embedded in the proposal, noting that it includes measures to re­duce borrowing and increase revenue through reforms in taxation and public finance management.

However, some lawmakers expressed concerns over the increasing debt servicing costs, which account for a significant portion of the budget.

They urged the govern­ment to explore innovative ways to generate revenue and reduce the nation’s de­pendence on loans.

The House Leader, Julius Ihonvbere, assured Nigerians that the Appro­priations Committee would scrutinise the budget during subsequent stages to ensure every naira is judiciously al­located.

The bill will now move to the committee stage, where lawmakers will analyse the budget’s details, sectoral al­locations, and policy assump­tions before the final passage.

If passed into law, the 2025 budget will be the largest in Nigeria’s history, underscor­ing the government’s com­mitment to addressing the nation’s pressing socioeco­nomic challenges.

At Thursday’s plenary presided over by Speaker Tajudeen Abbas, members debated the budget, empha­sising its prospects and challenges.

The debate commenced following the adoption of a motion for ‘A Bill for an Act to authorise the issuance of N49.74 trillion from the Consolidated Revenue Fund of the Federation,” moved by House Leader, Prof. Julius Ihonvbere.

Leading the debate, Prof. Ihonvbere urged members to support the appropriation bill, emphasising that its successful implementation would significantly address the nation’s current chal­lenges.

“The budget proposal addresses key issues that directly impact the lives of Nigerians, and it is crucial that we all support its timely consideration and passage,” he stated.

The budget emphasises defence, infrastructure, and human capital development, with a projected deficit of N13.39 trillion, which will be financed through borrowing.

In his contribution to the ongoing budget debate, Abdussamad Dasuki, the member representing Keb­be/Tambuwal Constituency of Sokoto State, commended President Bola Tinubu for his leadership since assuming of­fice in 2023.

However, he called for an upward review of the pro­posed estimates to better ad­dress the country’s pressing challenges.

Dasuki, a member of the Peoples Democratic Party (PDP), remarked that while the budget appears substantial on paper, its actual value is insufficient when convert­ed to foreign exchange terms.

“The budget may seem robust on paper, but if you convert it to dollars, you’ll realise it falls short of what is needed. Considering the challenges we face, the nation is inadequately provided for,” he said.

He urged the relevant committees, particularly the Committee on Finance, to critically review the budget and propose adjustments to meet the country’s financial demands effectively.

He questioned the parame­ters adopted in arriving at the allocation to the North-West Development Commission.

“More allocation is need­ed for the North-West De­velopment Commission. We should ask ourselves the pa­rameters used in arriving at this allocation,” he said.

On his part, a PDP lawmaker from Bauchi State, Is­maila Dabo, urged the House to ensure that the agricultur­al sector receives a befitting allocation in the 2025 budget given the inflationary pres­sure on food items in the past few years.

“Inflation is on food items and Nigerians are finding it difficult to cope. I urge the House to do everything possible to ensure enough allocation is reserved for ag­riculture,” he said.

He, however, called on the Federal Government to prioritise revenue generation to fund the budget rather than resorting to loans as has been the practice in the past few months.

Similarly, Ahmad Jaha, representing Damboa/Gwo­za/Chibok Federal Constit­uency, Borno State, echoed the need to get the security budget right.

He noted that the N4.91 trillion allocated to securi­ty in the 2025 budget is not enough, saying, “All the bud­get elements are achievable if we are secured as a nation. The budget proposals are am­bitious and in order, particu­larly the focus on agriculture and infrastructure.”

Taking a slightly different position on the budget esti­mates is an All Progressives Congress lawmaker from Nasarawa State, Jeremiah Umaru, who questioned the rationale for making al­location to the South West Development Commission in the 2025 budget proposal even though the board of the commission is yet to be con­stituted.

In his contribution, the Deputy Chief Whip of the House, George Ozodinobi, called for adequate budget­ary provision for the SEDC.

“The money allocated to the SEDC is not enough. We need more money for the take-off of such a commis­sion but I want to say that if implemented, the budget has what it takes to make Nigeri­ans proud,” he said.

Meanwhile, the House has adjourned plenary sessions until Tuesday, January 14, 2024, when lawmakers are expected to resume legisla­tive duties. (Source: Independent.ng)

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“It is with great pleasure that I lay before this distinguished joint session of the National Assembly, the 2025 Budget of the National Assembly of Nigeria titled, ‘The Resurrection Budget’ security peace, building prosperity,” Tinubu said as he concluded his 30-minute speech at 1:10 pm on Wednesday.

Earlier in his presentation, the President listed some of the highlights of the budget as defence and security – N4.91tn, infrastructure – N4.06tn, health – N2.4tn, and education – N3.5tn, among others.

“The 2025 budget seeks to restore macro-economic stability enhance the business environment, foster inclusive growth, employment and poverty reduction, promote equitable income distribution and human capital development,” Tinubu said.

“In 2025, we are targeting N34.8tn in revenue to fund the budget. government expenditure in the same year is projected to be N47.90tn including N15.81tn for debt servicing.

“A total of N13.0tn or 3.89% of GDP will make up the budget deficit. This is an ambitious but necessary budget to secure our future.

“The budget projects inflation will decline from the current rate of 34.6% to 15% next year (2025) while the exchange rate will improve from approximately N1,700 per dollar to N1,500 per dollar.”

The President also pegged crude oil production at 2.06 million barrels per day.

He expressed commitment to economic renewal, thanking all Nigerians for embarking on the journey of reform and transformation in the last 18 months together.

The President said the economy is responding to stimulus and that his government would continue to take the right steps for economic progress. “The reforms yielding results, no reversals,” he said.

Tinubu stressed that food security is non-negotiable, adding that the government is taking steps to ensure Nigerians feed and not go to bed hungry.

Tinubu said, “Our 2025 is not just another statement of projected government revenue and expenditure; it is one that calls for action.

“Our nation faces existential threat from corruption and insecurity…These challenges are surmountable when we work collaboratively. We must re-write the narrative of this nation.

“The time for lamentation is over. The time to act is act is now.”

Tinubu was accompanied to the budget presentation by the Secretary to the Government of the Federation (SGF), George Akume; and the Chief of Staff to the President, Femi Gbajabiamila; among other top government officials.

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