In a decisive move ahead of the 2025 budget presentation, the Nigerian Senate has approved the 2024-2026 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP).
However, the approval comes with a strong focus on investigating the Nigerian National Petroleum Company Limited (NNPCL) over allegations of unremitted funds totaling N8.48 trillion, linked to petrol subsidies.
The Senate’s approval follows the adoption of a report by the Joint Committees on Finance, National Planning, and Economic Affairs, which was chaired by Senator Sani Musa.
The report set the stage for further scrutiny of the NNPCL, with a particular emphasis on unremitted taxes and under-recovery from the sale of Premium Motor Spirit (PMS), commonly known as petrol, between 2020 and 2023.
The investigation was prompted by a report from the Nigeria Extractive Industries Transparency Initiative (NEITI), which claimed that the NNPCL failed to remit $2 billion (approximately N3.6 trillion) in taxes to the federal government.
The Senate has directed relevant committees to undertake an in-depth examination of the agreements involving NNPCL, Nigerian Liquefied Natural Gas (NLNG), and Immigration Services, aiming to reconcile remittances to the Federation Account.
The Chairman of the Senate Committee on Public Accounts, Senator Aliyu Wadada, raised concerns over the integrity of some documents presented by the Federal Inland Revenue Service, accusing the agency of submitting altered and suspicious documents during the Petroleum Profit Tax investigation.
Wadada also pointed out that the Central Bank of Nigeria (CBN) failed to remit N6 trillion in profit from ways and means into the Federation Account, further highlighting the ongoing financial discrepancies.
The planned expenditure for 2025, estimated at N47.9 trillion, is expected to require a new borrowing of N9.22 trillion to cover the shortfall. Capital expenditure is projected at N16.48 trillion, with recurrent spending at N14.21 trillion.
The Senate’s approval of the MTEF and FSP is based on several key economic projections, including a GDP growth rate of 4.6% in 2025, which is expected to rise to 5.5% in the following two years.
The exchange rate has been pegged at N1,400 to the US dollar, with an oil benchmark price of $75.3 per barrel and daily crude oil production forecasted at 2.06 million barrels.
The Senate’s report has set the stage for the highly anticipated 2025 budget presentation by President Bola Tinubu.
Notably, the report also emphasizes the importance of supporting the country’s manufacturing sector to meet the ambitious projections outlined in the MTEF.
Senator Solomon Adeola, Chairman of the Senate Committee on Appropriations, referenced the Federal Government’s Compressed Natural Gas (CNG) initiative as a key factor in supporting the exchange rate assumption of N1,400 to the dollar.
Meanwhile, former Senate Leader, Senator Yahaya Abdullahi, urged greater attention to the manufacturing sector to ensure the successful realization of the MTEF’s economic projections.
Senate President, Senator Godswill Akpabio, commended the joint committees for their diligent analysis and contributions, praising the thorough work that formed the basis for the approval of the MTEF and FSP.
The outcome of the ongoing investigations and the Senate’s oversight on financial accountability will be closely monitored as the government prepares for the upcoming budget.