How to make N58.47tr 2026 budget more meaningful, by experts

The Federal Government needs to optimize revenue generation, scale down and redirect borrowings and implement effective project-based assessments in order to achieve the overall developmental goals of the 2026 budget.

President Bola Tinubu had at the weekend presented a N58.47 trillion 2026 Appropriation Bill to the National Assembly with a promise that the new fiscal year would usher in a new era of discipline, accountability and results-driven public spending.

The 2026 Appropriation Bill projected total revenue of N34.33 trillion, total expenditure of N58.18 trillion, including N15.52 trillion for debt servicing, recurrent non‑debt expenditure of N15.25 trillion, capital expenditure of N26.08 trillion and budget deficit of N23.85 trillion, representing 4.28 per cent of GDP.

The budget was premised on crude oil benchmark of $64.85 per barrel, crude oil production of 1.84 million barrels per day; and exchange rate of N1, 400 per dollar.

Key sectoral allocations included defence and security, N5.41 trillion; infrastructure, N3.56 trillion; education, N3.52 trillion and health, which got N2.48 trillion.

Finance and economy experts yesterday said the government must review its implementation strategy, strengthen inclusive budget alignments across all tiers, drive revenue in non-inflationary way and reduce budget deficit and borrowings.

Experts who spoke included Chief Executive Officer, Centre for the Promotion of Private Enterprises (CPPE), Dr Muda Yusuf; Managing Director, Arthur Steven Asset Management, Mr Olatunde Amolegbe; Managing Director, AIICO Capital, Dr Femi Ademola and Managing Director, HighCap Securities, Mr David Adonri.

Yusuf said the 2026 budget appeared more realistic but the government should consider adopting more conservative stance.

He said: “We should have a much better budget in 2026 than the previous one. The assumptions on which the budget was based looked to be a lot more realistic, a lot more conservative as compared to what we had in 2025. But it will not be a bad idea to further review the assumptions, $64 per barrel is still a bit on the optimistic side. If it can come down to $60, that will not be a bad idea. And the oil output of 1.8 mbpd, given the historical level of performance, 1.8 mbpd is also a bit on the optimistic side. Those assumptions are much more realistic, but they can be even more realistic. So I would rather suggest that we have a further review of those assumptions”.

He said the National Assembly should avoid the temptation to arbitrarily review the budget upward as a result of constituency projects.

“We should not allow that kind of thing to happen this year. Because the beauty of a budget is in the credibility of the budget. If we continue to have budgets that are poorly implemented, the budget itself will lose credibility, and it will lose trust. And I think the President alluded to that even in his speech to members of the National Assembly. So we have to be careful about throwing in all manner of projects into the budget in a way that will now create huge expenditure expectations that will not be met,” Yusuf said.

He expressed concerns over revenue shortfalls, urging government to review its strategies on revenue generation from generating agencies, especially non-tax revenue.

He said: “I think we need to optimise that, and I think again the President emphasised that, and that firm steps will be taken to ensure that we optimise the non-tax revenue, that is from agencies of government that are generating revenue. So if we put all of this together, I think that will improve the fiscal consolidation.

Advertisement

“But we need to worry about the burden of debt service. It underscores the need for us to review our debt management strategy, for the need for us to also moderate the level or the rate of debt accumulation. Because debt servicing costs, even in this budget, are almost 50 per cent of revenue. I mean that cannot continue in that way because that is shrinking the fiscal space. It’s also one of the factors affecting budget implementation”.

He stressed the need for all tiers of government to collectively work to address structural pain points hindering the development of the economy.

“We also need to underscore the point that fixing the structural issues in the economy is not only the function of the federal government. So as we have conversations around the federal budget, we should be having conversations around the budget of the sub-nationals. Most of them have, in fact, practically all of them have more revenue now. So they should also come with impactful projects on health, on education, on roads, on rural development, on agriculture.

“They also have a major role to play. There is a general tendency around the country that when we are having conversations around the budget, we focus only on the federal budget. I think that mindset needs to change. We need to recognize that the states also have their own budgets. The local governments also have their own budgets, and they should be equally held accountable for what they do with these budgets. We now see states, many of them, having budgets of close to a trillion naira, even more than that. That is quite significant. So we need to equally track all those budgets of the sub-nationals,” Yusuf said.

Amolegbe said there was need to continue to grow the budget size to reflect the population size.

“Our budget is yet to get to the level that has the potential to get a significant number of people out of poverty. It’s also critical that the level of implementation needs to improve in order to achieve effectiveness. We also need to pay attention to our debt to revenue level,” Amolegbe, a former president of Chartered Institute of Stockbrokers (CIS) said.

Ademola said the 2026 budget proposal was not totally unexpected as with a progressive administration that has a centre left ideology, the expanded budget, focus on infrastructure and on borrowing are not out of place.

He however expressed concerns that with the experience of the past years, especially since 2024, it is surprising that the government is still operating a high budget deficit.

He said: “From the speech, the President confirmed that the country under-achieved its budgets for 2024 and 2025 due to revenue shortages. It is therefore confusing that we are still having an expanded budget despite the possibility of revenue shortage.

“For instance, only N5.33 trillion was spent in 2025 to execute the capital expenditure for 2024 and 2025. It is therefore unclear why we are still budgeting over N26 trillion in 2026. I am also worried that we are not working towards balancing our budget in view of revenue challenges.

“While the expected increased revenue from taxes may cover the gap, I would have loved to see the implications of the tax laws especially with regards to revenue generation before we start to plan how to spend it.

“The good thing is that the budget estimates with regards to oil productions, exchange rate and oil prices assumptions are reasonable. Hence the revenue expectation may be achieved. However, it would be good to reduce expenditure so that budget deficit is significantly reduced”.

Adonri noted that if the 2026 budget can consolidate the unimplemented portions of previous budgets, it would be great relief.

He also expressed concerns that the “deficit content of the proposed budget remains astronomical”.

“This expansionary fiscal policy will fuel inflation. With the precarious state of the global crude oil market and ravaging insecurity, a more conservative approach to expenditure would have been more appropriate. If the country is truly in a state of emergency, over 50 per cent of all available resources ought to be mobilised to restore firm order. If insecurity is not eliminated, all the grandiose programmes of agricultural and industrial development may be a mirage. I am not convinced that this budget is philosophically sound and strategically constructed to usher in enduring peace and prosperity,” Adonri said.

Advertisement

Addressing a joint session of the National Assembly in Abuja, President Tinubu had said he had already issued firm instructions to key economic managers of government to ensure that the 2026 budget is implemented strictly in line with approved details and timelines, warning that Nigeria could no longer afford fiscal indiscipline, leakages and underperformance across its institutions.

“I have issued directives to the Minister of Finance and Coordinating Minister of the Economy, the Minister of Budget and Economic Planning, the Accountant-General of the Federation, and the Director-General of the Budget Office of the Federation to ensure that the 2026 Budget is implemented strictly in line with the appropriated details and timelines,” Tinubu said.

He said the 2026 budget, christened “Budget of Consolidation, Renewed Resilience and Shared Prosperity,” would be financed largely through stronger revenue performance arising from the recently enacted National Tax Acts and far-reaching reforms in the oil and gas sector, which he said were designed to deliver transparency, efficiency, fairness and long-term fiscal value.

According to him, the reforms underway were not merely revenue-raising tools, but structural changes aimed at rebuilding Nigeria’s fiscal architecture and restoring confidence in public finance management.

To meet the funding requirements of the budget, Tinubu directed all heads of Government Owned Enterprises to meet their assigned revenue targets, stressing that remittances to the Federation Account would no longer be treated as optional.

He said: “To support this, we will deploy end-to-end digitisation of revenue mobilisation—standardised e-collections, interoperable payment rails, automated reconciliation, data-driven risk profiling, and real-time performance dashboards—so leakages are sealed, compliance is verifiable, and remittances are prompt”.

He added that revenue performance would now be central to institutional assessments, noting that the era of weak accountability had come to an end.

“These targets will form core components of performance evaluations and institutional scorecards. Nigeria can no longer afford leakages, inefficiencies, or underperformance in strategic agencies. Every institution must play its part,” Tinubu said.

He said the 2026 budget was anchored on four broad objectives: consolidating macroeconomic stability, improving the business and investment climate, promoting job-rich growth, while reducing poverty, and strengthening human capital with deliberate protection for the most vulnerable citizens.

He said: “In short, we will spend with purpose, manage debt with discipline, and pursue growth that is broad-based—not narrow—and sustainable—not temporary”.

Presenting the fiscal framework, the President said the budget was built on realism, prudence and a growth-oriented outlook. He disclosed that expected total revenue for 2026 stood at N34.33 trillion, while projected expenditure was N58.18 trillion, including N15.52 trillion earmarked for debt servicing. Recurrent non-debt spending was projected at N15.25 trillion, while capital expenditure was put at N26.08 trillion.

The budget deficit of N23.85 trillion, representing 4.28 per cent of Gross Domestic Product, he said, remained within manageable limits.

“These numbers are not just accounting lines. They are a statement of national priorities. We remain firmly committed to fiscal sustainability, debt transparency, and value-for-money spending,” Tinubu said.

He explained that the projections were guided by the 2026–2028 Medium-Term Expenditure Framework and Fiscal Strategy Paper, based on a conservative crude oil benchmark of $64.85 per barrel, oil production of 1.84 million barrels per day and an exchange rate assumption of N1,400 to the dollar.

He assured that government would continue to reduce waste, strengthen controls and ensure that every naira borrowed or spent delivers measurable public value, particularly in infrastructure, human capital development and national security.

Advertisement

On sectoral priorities, Tinubu said the allocations reflected the practical needs of Nigerians under the Renewed Hope Agenda. Defence and security received N5.41 trillion, infrastructure N3.56 trillion, education N3.52 trillion and health N2.48 trillion.

He said: “These priorities are interlinked. Without security, investment will not thrive. Without educated and healthy citizens, productivity will not rise. Without infrastructure, jobs and enterprise will not scale. This is why the Budget is designed as one coherent programme of national renewal”.

He devoted a significant portion of his address to national security, delivering a forceful warning to terrorists, bandits and criminal networks operating across the country. He said security spending would now be tied to clear outcomes, insisting that public funds must translate into safer communities.

“We will invest in security with clear accountability for outcomes—because security spending must deliver security results,” Tinubu said.

He explained that the government would increase the fighting capacity of the armed forces and other security agencies through improved personnel strength and the acquisition of advanced platforms and hardware. He also announced a comprehensive reset of Nigeria’s national security architecture, including the introduction of a new national counterterrorism doctrine.

He said: “Our administration is resetting the national security architecture and establishing a new national counterterrorism doctrine—a holistic redesign anchored on unified command, intelligence, community stability, and counter-insurgency”.

Under the new doctrine, the President declared that any armed group operating outside state authority would be classified as terrorists.

“Henceforth, and under this new architecture, any armed group or gun-wielding non-state actors operating outside state authority will be regarded as terrorists,” Tinubu said, listing bandits, militias, armed gangs, criminal networks, violent cult groups, forest-based armed collectives and foreign-linked mercenaries among those covered.

He extended the classification to financiers, informants, ransom negotiators, political protectors, arms suppliers and community leaders who facilitate violent acts, stating that anyone enabling terrorism would be treated as a terrorist.

Turning to human capital development, the President said no nation could grow beyond the quality of its people, adding that the 2026 budget strengthened investments in education, healthcare, skills acquisition and social protection.

He disclosed that over 418,000 students had already benefited from the Nigerian Education Loan Fund in partnership with 229 tertiary institutions nationwide. He added that healthcare spending accounted for six per cent of the total budget size, net of liabilities.

Tinubu also announced that recent engagements with the United States government had opened the door to over $500 million in grant funding for targeted health interventions across Nigeria.

“We welcome this partnership and assure Nigerians that these resources will be deployed transparently and effectively,” he said.

On infrastructure and economic productivity, the President said projects under the Renewed Hope Agenda were moving steadily from vision to execution, covering transport, energy, ports, agriculture and strategic investments capable of unlocking private capital.

He said food security remained a national security issue, noting that the 2026 budget prioritised input financing, mechanisation, irrigation, climate-resilient farming, storage, processing and agro-value chains to reduce post-harvest losses and improve rural incomes.

Advertisement

As he concluded, Tinubu told lawmakers and Nigerians that the true measure of a budget lay not in its announcement but in its delivery.

“The greatest budget is not the one we announce. It is the one we deliver,” he said.

He pledged better revenue mobilisation, better spending discipline and stronger accountability as the three guiding commitments for 2026, adding that trust would only be built by matching words with results.

“The 2026 Budget is not a budget of promises; it is a Budget of Consolidation, Renewed Resilience and Shared Prosperity,” Tinubu said, formally laying the Appropriation Bill before the National Assembly.

So those are the things that we need to look at. Generally, it’s a good budget, but we need to look at these areas that I’ve just mentioned. And of course, the President recently re-enacted the 2025 budget, authorizing the release of about 43 tr  from the consolidated revenue account.

Now, that has just been sent to the National Assembly in the form of another appropriation act. So we need some clarity as to how we are going to reconcile the new budget and the one that the President recently sent to the National Assembly. I’m talking about the enactment of the 2025 appropriation act.

A bit of projects were done and according to the finance minister, I think 30 per centof the releases have been made. It remains 70 per cent. So that, of course, has affected the capacity of the project to impact on productivity and quite a number of projects, of course, were not able to be implemented as a result of those challenges.

So the steps that have been taken, hopefully, will help to avoid a repeat of that experience that we had with respect to the 2025 budget. But in all of this, we also need to realize or underscore the fact that the current parts of the budget were almost fully implemented. So when we talk about poor implementation, it is essentially around the capital budget implementation. I think that clarity is important.