President Bola Tinubu and the National Assembly are facing renewed backlash following the second extension of the capital component of the 2024 budget, now slated for implementation until December 31, 2025. The move, which was approved by both the Senate and the House of Representatives, has drawn sharp criticism from economists, financial analysts, and the Organised Private Sector, who argue it reflects poor execution by government agencies and undermines fiscal discipline.
The Senate passed the amendment to the Appropriation Act during plenary, with Deputy Senate President Barau Jibrin announcing the decision after a swift three-stage reading. Senator Olamilekan Adeola, Chairman of the Senate Committee on Appropriation, justified the extension by citing ongoing projects that require more time and the government’s limited fiscal resources.
The House of Representatives followed suit, advancing a similar bill presented by Deputy Majority Leader Ibrahim Halims. Speaker Tajudeen Abbas said the extension was necessary due to insufficient implementation of the capital component. The bill was passed for a second reading and forwarded to the Committee on Supply.
The initial extension had shifted the deadline from the end of 2024 to mid-2025, following a request by President Tinubu, who argued it would help complete vital infrastructure projects and optimise allocations. However, as the new June deadline approached, it became apparent that key projects remained unfinished, prompting lawmakers to approve another six-month extension.
With this latest extension, Nigeria now finds itself running two budgets simultaneously — the 2024 budget still being executed and the 2025 budget, which is technically in force but yet to be implemented. A senior official from a federal ministry revealed that despite the year being halfway gone, the 2025 budget had not commenced. The ministry is still operating under the 2024 budget, causing significant delays in contractor payments and outstanding allowances for staff.
According to the official, the implementation of the 2025 budget may not begin until August, a delay that is already disrupting operations and prompting hopes that the government might grant a similar extension for the 2025 budget cycle.
The Director of Press and Public Relations at the Office of the Accountant General of the Federation, Bawa Mokwa, confirmed that capital funds from the 2024 budget were only recently disbursed to ministries. He added that there was an understanding to begin implementation of the 2025 budget only after the 2024 capital component is closed.
Renowned economist and CEO of Economic Associates, Ayo Teriba, criticised the recurring extensions, warning that the practice is becoming habitual. He argued that budgets meant for 12 months should not take two years to execute and stressed the urgent need to secure adequate funding within the appropriate time frame. He also questioned the release of funds for the first quarter of 2025 despite reported revenue generation.
Chief Economist at SPM Professionals, Paul Alaje, warned that the simultaneous execution of two budgets could increase the money supply, potentially leading to inflation. He noted that without transparency on whether projects are merely unpaid or not initiated at all, the full economic impact remains unclear. He called for strict adherence to budget cycles, recommending any necessary extensions be limited to the first quarter of the following year for better predictability.
Professor Akpan Ekpo, a seasoned economist, called the situation embarrassing and a reflection of weak forecasting and poor planning. He stressed that running two budgets concurrently creates uncertainty, discourages investor confidence, and could worsen Nigeria’s stagflation by increasing inflation and stalling growth, development, and employment.
Dr Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, noted that capital budget performance has historically been suboptimal. He attributed the trend to unrealistic revenue projections, particularly from oil, and suggested that the 2024 budget may have been overly ambitious.
Critics broadly agree that Nigeria must adopt a more credible and disciplined approach to budgeting, avoiding the pitfalls of overlapping budget cycles and ensuring more effective execution of capital projects within the intended fiscal year.
ADEOLA KUNLE
