The Senate on Thursday subjected members of the Federal Government’s economic team to nearly five hours of intense questioning over the proposed N58.472 trillion 2026 Appropriation Bill, raising concerns about rising debt obligations, revenue projections and what lawmakers described as overly ambitious assumptions.
The scrutiny took place during an interactive session with the Senate Committee on Appropriations, chaired by Senator Solomon Olamilekan Adeola (Ogun West), as lawmakers examined the fiscal framework underpinning the record budget proposal.
Central to the deliberations were questions about the oil production benchmark of 1.84 million barrels per day, projected revenue targets, debt servicing costs and the implementation performance of previous budgets — particularly the release of capital funds to Ministries, Departments and Agencies (MDAs).
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, defended the administration’s projections, describing the oil production benchmark as a “stretch target” intended to encourage improved output rather than signal complacency.
“It is a stretch target so that the authorities do not settle for lower output. But as long as we do not spend what we do not have, we are within safe limits,” Edun told lawmakers.
He emphasised that security spending remains a top priority under the proposed budget, revealing that emergency funds had been released and critical foreign payments for security equipment made at least twice this year.
“We all agree that security is to be prioritised. I can assure you that emergency funding has been given,” he said.
On Nigeria’s debt profile — estimated at about N152 trillion — Edun argued that the core challenge lies not in the debt-to-GDP ratio but in the high cost of borrowing on international markets.
“The problem is the pricing. Developing countries are forced to pay high interest rates in international markets. That is where the difficulty lies,” he said, noting Nigeria’s leadership role in the G24 technical group on debt sustainability.
Edun added that when the current administration assumed office in 2023, it faced significant financial pressures in stabilising the economy. “If you do not maintain credibility, the exchange rate will move,” he cautioned.
The Chairman of the Nigeria Revenue Service, Zacch Adedeji, also urged caution against inflated projections, stressing that the credibility of the budget depends on realistic assumptions.
“Budget efficiency is not in the quantum of the budget; it is in what you can carry out,” Adedeji said, explaining that under the Petroleum Industry Act, government oil revenues are largely limited to taxes and royalties, as the Nigerian National Petroleum Company operates as a limited liability entity.
“If production costs are high, the net revenue to the government is affected,” he noted.
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Chairman of the Committee, Senator Adeola, pointed to discrepancies between projected and realised oil revenues in previous fiscal years, questioning the optimism reflected in the new estimates.
“This document before us originated from the executive. The projections and challenges came from the executive arm, not the legislature. The gap between projected and realised oil revenue is wide,” Adeola said.
He cited instances of low performance rates and asked whether lawmakers should reduce the proposed N58.472 trillion budget or proceed with adjustments, warning that debt financing levels are already high.
“If certain assets were disposed of and used to reduce debt, two things would happen: the overall debt stock would reduce, and future borrowing costs could decline,” he suggested.
Lawmakers also pressed the executive on delays in funding capital components of previous budgets. In response, Minister of State for Finance Doris Uzoka-Anite assured the committee that outstanding capital payments under the 2024 and 2025 budgets would be processed before March 31, 2026.
The extended grilling reflects growing legislative concern about fiscal sustainability and the credibility of revenue assumptions, as Nigeria navigates mounting debt pressures while attempting to sustain growth and meet security challenges.