The Economic Advisory Council (EAC) of the Nigerian Economic Summit Group (NESG) has stressed the need for the Nigerian government to set priorities and objectives to be met by annual budget. This the council said would aid effective budget implementation.
Speaking during an interactive session with journalists in Abuja on Monday, Mohammed Sagagi, the co-chairman of the Council said that to have a good budget, the government need to have certain parameters to guide details of the budget, adding that once these parameters are missing, the budget may likely not meet its objectives.
He decried that of the N34.33 trillion proposed revenue in 2026 medium term expenditure framework of the government, over N15 trillion has been pegged to service debt. He also added that the amount for debt servicing represents about 29 percent of total expenditure and 46 percent of total revenue in the budget.
“The President has a vision and the Minister of Budget would have defined clearly the objectives of that budget. You need to have the resources, you need to have realistic assumptions. In which case you have realistic budget, not a political budget.
Read also: NESG charts path to address infrastructure deficit, Nigeria’s economic potential
“And once those things are missing, the end result is not going to be palatable and I think part of the problem is that we are not able to stick to the objectives of our budget. We are not able to have our objectives as realistic as they should be. And then we keep repeating, we keep making those mistakes over and over and over again.
“So for 2026, the assumptions that we have are that we will get N34 trillion, and that is based on what? It is based on oil production of about 2 million barrels per day, and oil price of $64. So you ask yourself, is it realistic if you are producing 1.4 million barrels per day, is it realistic? Why are you assuming that we can have, you know, 2 million barrels from next year? You also have to ask yourself from non-oil sector, what did we get in the previous year, and how much do you think we will be able to make this year?
“But, you know, you ask questions that perhaps are even more concerning, more worrying. Out of the N34 trillion revenue you project to generate, how much of that is going on debt servicing? You are spending about N15 trillion to service your debt.
“Now this tells you exactly, even if you are able to do so, it tells you the level of impact, the likely impact of the budget. Because already 46 percent of that revenue is gone, is gone on debt servicing. 29 percent of what you are going to spend is gone on debt servicing.
“And then you have non-recurrent expenditure and personal costs, that will also take. So if you see, you know, the capital expenditure aspect of the budget is the fulcrum of the budget. It is what makes the budget.”
Also speaking, Osita Ogbu, Co-chairman, Economic Advisory Council of NESG, said the budget is fundamentally about understanding its core principles, noting that the government could return to zero-based budgeting, starting fresh each year instead of simply adjusting last year’s expenditures.
He said priorities must be set from the top, stressing that this is the direction the government intends to follow. He explained that if a president decides, for example, to allocate 40 percent of the budget to health and 10 percent to education, there should be a clear reason for it.
He said, “I thought that by now we could have gone back to the so-called zero budgeting, where we start afresh. If you know how budgets are done, it’s like, adding up what you did last year to this year because government has limited assets and money.
“Therefore, priorities must be defined from the top. This is the direction in which we are going. So, if a president says, I want to spend 40 percent of my budget on health, and 10 percent on education, there must be a reason for it. How then does it get to National Assembly and it turns upside down?,” he asked.
He said budget decisions need a clear framework and reason, with priorities chosen to achieve broader goals. He stressed the need for elite consensus to guide the country’s direction, define budget boundaries, allocate scarce resources, and organise government institutions to address key sectors like industrialisation and agriculture.
