2025 Budget: National Assembly slashes capital expenditure

On Tuesday, the National Assembly adjusted the 2025 budget to correct allocation errors affecting certain federal ministries, departments, and agencies (MDAs).

The amendment led to a reallocation of funds, increasing the budgetary provisions for some agencies while reducing allocations for others.

At the Senate, the amendment motion was sponsored by Adeola Olamilekan, the Chairman of the Committee on Appropriations, and considered by the Committee of Supply.

One of the adjustments was the increase in the Recurrent (Non-Debt) Expenditure, which was initially set at N13 trillion but has now been raised to N13.5 trillion, an increase of approximately N500 billion.

Another correction was the initial Capital Expenditure of N23.9 trillion, which was reduced to N23.4 trillion, a reduction of about N500 billion.

Despite these adjustments, the total budget remains unchanged at N54.9 trillion.

The adjustments mean the N500 billion reduction from the capital expenditure was added to the recurrent (Non-debt) expenditure.

The 2025 budget was initially passed by both chambers of the National Assembly on 13 February, increasing President Bola Tinubu’s proposal from N54.2 trillion to N54.9 trillion.

The increment marked an upward adjustment of about N750 billion.

The earlier approved budget included allocations of N3.6 trillion for Statutory Transfers, N14.3 trillion for Debt Service, N23.9 trillion for Capital Expenditure, and N13.8 trillion for Fiscal Deficit.

However, President Tinubu has yet to give his assent to the budget.

Review uncovered errors

While presenting the amendment motion, Mr Olamilekan explained that a review of the budget revealed errors in the line items passed by both chambers of the National Assembly.

He proposed maintaining the total budget figure at N54.9 trillion, with no changes to Statutory Transfers at N3.6 trillion and Debt Service at N14.3 trillion.

However, he recommended increasing Recurrent (Non-Debt) Expenditure from N13 trillion to N13.5 trillion and reducing Capital Expenditure from N23.9 trillion to N23.4 trillion.

Following deliberations, the Senate President, Godswill Akpabio, put the amendments to a vote, and the senators overwhelmingly supported them.

However, Mr Akpabio rescinded the Senate’s decision on the affected line items and passed the amendment.

He noted that the amendment was to ensure clarity and transparency.

The adjustments in the line items for the Recurrent are:

-Ministry of Defence allocation reduced from N2.51 trillion to N2.49 trillion.

-Ministry of Police Affairs allocation was revised from N1.225 trillion to N1.224 trillion.

-Total Pensions, Gratuity, and Retirement Benefits increased from N950 billion to N1.44 trillion.

-Military Pensions and Gratuities allocation adjusted from N252.6 billion to N383.9 billion.

-National Pension Commission (PENCOM) increased from N529.4 billion to N804.7 billion.

Corrections in the capital allocation are:

-Presidency allocation was reduced from N144.4 billion to N142.7 billion.

-Federal Ministry of Agriculture and Food Security allocation reviewed from N1.95 trillion to N1.83 trillion.

-Federal Ministry of Works revised from N2.04 trillion to N2 trillion.

-Federal Ministry of Education allocation was reduced from N953.9 billion to N944.6 billion.