The Federal Government has announced a strategic shift away from heavy borrowing towards aggressive revenue mobilisation and savings optimisation, as Nigeria’s public debt stock climbs to about ₦152 trillion.
The new direction was outlined by the Minister of Finance and Coordinating Minister of the Economy, Dr Olawale Edun, during the presentation of the 2026–2028 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) to the Senate Committee on Finance.
Edun said government policy going forward would prioritise strengthening revenue generation rather than accumulating new debt, describing the current debt trajectory as unsustainable if revenue performance does not improve.
“The focus of the Medium-Term Expenditure Framework is not on increased borrowing. The emphasis is squarely on revenue generation,” he told lawmakers.
Revenue Shortfalls Exposed
The minister disclosed that Nigeria recorded a ₦30 trillion revenue shortfall in the outgoing year. Out of the ₦40 trillion revenue target for 2025, only about ₦10 trillion was realised.
He further revealed that for 2024, total revenue was projected at ₦25.9 trillion, but actual federal government revenue stood at approximately ₦8.27 trillion, highlighting a persistent gap between projections and reality.
“The reality is that revenue performance has consistently fallen short of budget estimates,” Edun said, noting that treasury management measures and financial engineering had been used to bridge funding gaps.
For 2025, he said projected revenue remains at ₦40 trillion, but actual federal government cash revenue is again estimated at around ₦10 trillion, a disparity he described as unsustainable.
“This historical trend clearly shows the need for a far more robust and realistic revenue effort going into 2026,” he added.
Budget Implementation Status
On budget performance, Edun said the 2024 budget had been largely implemented, with substantial execution of both recurrent and capital components. He explained that the capital component was extended into 2025, with full funding available for completed projects up to September.
Funding is available for part of the remaining capital expenditure, he said, while the balance is expected to be rolled over into the 2026 budget.
Regarding the 2025 budget, Edun disclosed that funding arrangements and approvals had been secured, with about 30 per cent of the capital budget already funded. The remaining portion, he said, would also be rolled over into 2026, subject to National Assembly approval.
Senate Calls for Public Enlightenment on Tax Reforms
Chairman of the Senate Committee on Finance, Senator Mohammed Sani Musa, urged the Federal Inland Revenue Service (FIRS) to embark on aggressive nationwide public enlightenment ahead of the implementation of the new tax reform laws scheduled for next year.
He warned that inadequate public understanding of the reforms could undermine their effectiveness and erode public trust.
Roadmap to Revenue Growth
To tackle weak revenue performance, Edun said the government is rolling out a comprehensive revenue optimisation programme anchored on automation, digitalisation, technology deployment and process re-engineering.
He stressed that improving revenue collection efficiency and mobilising savings are critical to restoring fiscal sustainability, reducing reliance on borrowing and stabilising Nigeria’s public finances over the medium term.
