The federal government has described as incorrect and misleading, the allegation that approximately two per cent of GDP amounting to over ₦8 trillion was spent outside the approved budget based on references to the IMF Representative in Nigeria and the Fund’s 2026 Article IV Consultation Report.
The denial was made on Sunday in a statement issued by the Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele.
He said the allegation was misleading the public about government’s financial management.
“For the avoidance of doubt, the Federal Government does not operate a “shadow budget” or expend public funds outside the constitutional and statutory framework established for public finance,” he said.
He explained that under “Under Sections 80 – 83 and 162 of the Constitution of the Federal Republic of Nigeria, 1999 (as amended), public funds may only be withdrawn and expended in accordance with the Constitution and laws enacted by the National Assembly.
“Accordingly, Federal Government expenditure is incurred pursuant to duly enacted Appropriation Acts, Supplementary Appropriation Acts, and other statutory authorities enacted by the National Assembly. In addition, multi-year capital projects which necessarily span multiple budgets are implemented in accordance with extant laws and approved provisions for capital rollovers where applicable. These are recognised features of public financial management and should not be misconstrued as expenditures outside the budget.”
The minister warned that it was inaccurate to suggest that trillions of naira had been secretly spent outside legislative approval.
Such allegations, he stated, should have identified the specific projects purportedly executed without appropriation or legal authority and present credible evidence in support of the claim.
He said assertions of that magnitude must be supported by verifiable facts rather than conjecture.
For the purpose of public education, he said, it was important to distinguish between appropriation, expenditure authorisation, financing, and fiscal reporting.
“Nigeria’s public finance framework contains several statutory transfers, first-line charges and intervention mechanisms established by Acts of the National Assembly,” he said.
Those included:
– Statutory allocations and contributions to development commissions and other agencies created by law.
– Cost of collection and cost of administration retained by designated revenue-collecting agencies as expressly provided under relevant legislation.
– Capital expenditure approved in separate budgets for some agencies and the Federal Capital Territory by the National Assembly.
– Special interventions approved by law to address national priorities such as security, infrastructure, disaster response, and other strategic national programmes or emergencies.
– Debt service obligations and other statutory transfers that are authorised under applicable legislation.
The minister said the expenditures were neither secret nor illegal.
According to him, they are established by law, disclosed in various fiscal reports, and subject to applicable oversight, audit and accountability mechanisms.
Their treatment for reporting purposes, he added, might differ from their presentation in the annual Appropriation Act, particularly under international statistical and reporting standards adopted by the Federal Government.
He said such classification differences should not be misrepresented as evidence of unlawful expenditure.
“It is equally incorrect to suggest that the reported amount represents an increase in budget deficit. A fiscal deficit is determined by the relationship between total government revenues and total government expenditures. Whether a capital project is financed through annual appropriations, supplementary appropriations, statutory transfers, approved intervention mechanisms, or other lawful financing arrangements does not, by itself, increase the fiscal deficit,” he argued.
He added that the the IMF’s observation related primarily to the comprehensiveness, timing and presentation of fiscal reporting rather than the legality of expenditure.
Like many countries, he said, Nigeria continued to strengthen the alignment between budget presentation and international fiscal reporting standards as part of ongoing public financial management reforms.
He stated too that as a matter of fact, President Bola Ahmed Tinubu, had himself formally requested the National Assembly to end the practice of running multiple and overlapping budgets, and rather harmonise into a single, cohesive framework during his presentation of the 2026 Appropriation Bill to a joint session of the National Assembly on December 19, 2025.
The federal government the minister affirmed, remained firmly committed to prudent fiscal management, transparency and accountability.
“Recent reforms have significantly strengthened public financial management with ongoing improvements in budget assumptions and credibility, transparent revenue administration, digitalisation of government financial processes, and stronger treasury management. These reforms have been acknowledged by the IMF itself and other multilateral institutions, as well as international credit rating agencies, major media organisations and investors,” stressed.
“Public debate is both welcome and essential in a democratic society. However, it should be based on facts and an accurate understanding of Nigeria’s constitutional and fiscal framework. Mischaracterising technical observations as evidence of unlawful expenditure neither advances informed public discourse nor strengthens democratic accountability.
“The Federal Government will continue to uphold the rule of law, maintain transparency in the management of public resources, and work with the National Assembly, oversight institutions, development partners and the Nigerian people to further strengthen fiscal governance in line with international best practices,” the minister asserted.
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