Tinubu Faces Criticism as Unambitious Budget of N27.5 Trillion Gets Approval

In a move that has sparked debates and raised eyebrows, the Federal Executive Council (FEC) greenlit a budget of N27.5 trillion for the upcoming year, maintaining controversial appropriation benchmarks and a seemingly conservative approach to public spending.

Scheduled for presentation to the National Assembly tomorrow by Bola Tinubu, the appropriation bill faces scrutiny for its divergence from prior commitments. Finance Minister Wale Edun’s assurance of steering clear of debt financing clashes with the proposed plan to borrow over N9 trillion, a contentious decision given current economic constraints.

Moreover, the budget’s growth projection of 4.78 per cent falls short of President Tinubu’s ambitious $1 trillion economic target, raising concerns among experts. Tinubu’s vow during the campaign for a six per cent average growth rate appears incongruent with the projected figures outlined in the Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP).

Critics argue that the proposed budget, translating to a per capita spending plan of N127,000 or about $150, pales in comparison to South Africa’s $2400 and Egypt’s $1500 per capita budgets from two years ago. Economist Prof. Bongo Adi dismisses the budget as insufficient, asserting that Nigeria should be spending ten times the proposed amount to attain its economic aspirations.

Adi emphasizes the need for substantial investments in critical infrastructure to rejuvenate the GDP to pre-Buhari era levels, suggesting a budget of N270 trillion instead of the approved N27.5 trillion.

The budget also perpetuates controversial revenue benchmarks, such as the oil production target of 1.8 million barrels per day, despite a historical average of 1.57 mbpd. With oil majors divesting and geopolitical tensions potentially impacting global supply, these benchmarks are viewed skeptically.

At a press briefing, Minister of Budget and Economic Planning Atiku Bagudu confirmed adjustments to the oil price benchmark from $73 to $77 and the exchange rate from N700/$ to N750/$ to boost government revenue to N18 trillion.

Despite these deliberations, concerns linger about the budget’s ability to kick-start the economy. With speculation of President Tinubu addressing the National Assembly tomorrow, the budget’s fate awaits further scrutiny in the coming days.