By Omoyeni Ojeifo
Escalating debt obligations, infrastructure demands, and higher worker wages have placed severe strain on the federal government finances.
To manage these pressures, the Federal Government borrowed ₦11.9 trillion as part of ₦20.4 trillion in supplementary resources, pushing total additional expenditures to ₦30.64 trillion.
This is according to Prof. Taiwo Oyedele, Finance and Coordinating Minister of the Economy, in Abuja on Wednesday as he presented the administration’s three-year economic reforms scorecard the which detailed the fiscal impacts, savings, and policy costs of economic reforms introduced since 2023.
PersecondNews correspondent reports that the minister explained that the ₦20.4 trillion in supplementary resources comprised ₦11.9 trillion in borrowing, ₦5.4 trillion from the Federal Government’s share of reform-related Federation revenue and ₦3.1 trillion in independent revenue.
“The Federal Government’s supplementary resources over the period came to ₦20.4 trillion. That money partly funded incremental expenses, but the incremental expenses of the Federal Government alone were ₦30.64 trillion,” he said.
Oyedele clarified that the difference between the ₦20.4 trillion in supplementary resources and the ₦30.64 trillion in additional expenditure was covered from the government’s existing revenue base.
“Two-thirds was funded by these new resources, while the remaining third, about ₦10 trillion, came from the existing revenue base.”
He noted that the largest demands on the additional expenditure were wage adjustments, external debt servicing and strategic infrastructure, which accounted for ₦9.39 trillion, ₦9.37 trillion and ₦6.5 trillion, respectively.
“The incremental amount that the Federal Government spent paying higher wages is more than the entire savings that the Federal Government earned from subsidies.”
The Minister emphasized that the ₦9.37 trillion spent on external debt servicing was partly driven by the naira’s depreciation, which increased the amount required in naira to service dollar-denominated obligations.
“If we were paying one million dollars before in interest on our foreign debts, it is still the same one million dollars, but instead of ₦460, it’s now ₦1,415. That’s more naira that we need to incur.”
Oyedele added that ₦6.5 trillion was also directed to strategic infrastructure, bringing the three largest expenditure lines to ₦25.26 trillion.
“Of the ₦20.4 trillion, 58 per cent came from borrowing, 27 per cent from subsidy savings and 15 per cent from other revenue, against total incremental spending of ₦30.64 trillion.”
He maintained, the borrowing would have been significantly higher without the fiscal space created by the reforms, arguing that the reforms helped the government meet its obligations without greater financial disruption.
“The additional borrowing that the Federal Government took for that period, June 2023 to December 2025, amounted to ₦11.9 trillion, a figure that would have been far higher and economically destabilising without the fiscal space the reforms created.”
Oyedele further disclosed that the Federal Government generated ₦3.1 trillion in incremental independent revenue, primarily through remittances and surpluses from government-owned entities.
“In addition to the amount from the Federation Account Allocation Committee (FAAC), Federal Government was able to also earn surpluses from government agencies. So those amounts went up, while ₦11.9 trillion came from incremental borrowing.”
He said government’s borrowing and spending figures were contained in the reforms scorecard, with detailed information provided for Nigerians and independent analysts to scrutinise.
“Every naira of this is accounted for, and the breakdown is in the scorecard we are releasing today. So you find the breakdown of how the resources were funded and how they were spent.”
Oyedele maintained that the reforms were not introduced simply to generate revenue, but to address structural problems in the fuel subsidy and foreign exchange systems while creating fiscal space for government.
“This is evidence that the reform was never introduced for revenue purposes, but to address entrenched corruption in an artificially managed fuel subsidy and foreign exchange markets.”
The Minister added that the federal government would continue to improve public financial management, prioritise spending and ensure that the gains from the reforms translate into tangible benefits for households across the country.