Money crunch: Ministers lament as N10tn capital funding stalls

Ministers accountable for key infrastructure and service-delivery companies are grappling with a extreme funding squeeze, as figures obtained by The PidomNigeria confirmed that MDAs obtained lower than N1tn for capital initiatives within the first seven months of 2025.

The info used for this report was probably the most up to date obtainable from the Price range Workplace of the Federation, because the company had but to launch complete full-year implementation figures, regardless of the fiscal yr being properly superior.

Analysts and public finance consultants have repeatedly criticised the Price range Workplace for delays in publishing up-to-date finances efficiency knowledge and for what they describe as weak transparency requirements within the dissemination of presidency fiscal info, notably below the present administration of Bola Tinubu.

An evaluation of information from the Price range Workplace of the Federation’s Medium-Time period Expenditure Framework and Fiscal Technique Paper (2026–2028) confirmed that whereas N18.53tn was appropriated for capital expenditure for “MDAs and others” in 2025, the January–July professional rata benchmark stood at N10.81tn.

Nonetheless, precise capital releases to MDAs and associated entities throughout the interval amounted to simply N834.80bn. That left a professional rata shortfall of about N9.98tn and a efficiency charge of solely 7.72 per cent throughout the seven-month window.

The broader capital image was equally weak. Mixture capital expenditure for 2025 was put at N23.44tn, with a professional rata expectation of N13.67tn by July. Precise capital spending throughout the board stood at N3.60tn, representing a 73.7 per cent shortfall relative to the professional rata benchmark.

The MTEF/FSP doc learn because the Price range Workplace acknowledged that capital expenditure spending was weak in 2025: “Capital expenditure implementation was notably weak. Solely N834.80bn had been launched to Ministries, Departments, and Businesses out of the pro-rata capital finances of N10.81tn, indicating lower than 10 per cent efficiency on the assessment interval.

“The low capital expenditure is especially as a result of effort to fulfill the 2024 capital finances, which was prolonged to December 2025. General, the whole capital expenditure reached N3.60tn as of July 2025, representing a shortfall of 73.7 per cent of the goal for the primary seven months.”

The numbers present that the capital drought was not occurring in isolation. On the income facet, combination Federal Authorities income for January to July was N13.67tn, under the professional rata goal of N23.85tn. Oil income underperformed sharply, dragging down total collections regardless of enhancements in some non-oil traces, reminiscent of Firm Earnings Tax and VAT.

When positioned facet by facet, the figures spotlight how restricted capital releases to MDAs have been relative to obtainable assets. The N834.80bn spent on MDA capital initiatives accounted for almost 6.1 per cent of complete Federal Authorities income of N13.67tn throughout the interval. It additionally represented roughly 4.1 per cent of the Federal Authorities’s complete expenditure of N20.40tn between January and July.

Even throughout the complete capital envelope recorded, MDAs accounted for a comparatively small share. Of the N3.60tn in complete capital expenditure throughout the seven months, the N834.80bn going to MDAs and associated capital votes represented about 23 per cent.

A good portion of capital spending as an alternative flowed by way of multilateral and bilateral project-tied loans, which stood at N1.68tn throughout the interval—roughly double the quantity launched on to MDAs. This funding construction underscores the Federal Authorities’s rising reliance on externally linked financing to maintain capital exercise in 2025.

Whereas loan-backed initiatives continued to report spending, direct money releases to ministries, departments, and companies lagged far behind authorized budgets. The outcome has been mounting frustration amongst ministers, notably in sectors reminiscent of well being, transport, and the blue economic system, the place latest disclosures have proven that solely tiny fractions of authorized capital allocations have been launched.

Ministers lament

The PidomNigeria earlier reported that the Federal Ministry of Well being and Social Welfare was unable to implement its 2025 capital finances as a result of solely N36m of the N218bn appropriated for the sector was launched, based on a disclosure by the Minister of Health, Prof Mohammed Pate.

Pate, who spoke throughout the Ministry’s 2026 finances defence earlier than the Home Committee on Healthcare Providers, attributed the poor capital finances efficiency to money circulation constraints and systemic bottlenecks within the Federal Authorities’s finances execution course of.

“Out of the N218bn appropriated to the well being sector by the parliament for the execution of capital initiatives within the 2025 fiscal yr, solely N36m was launched,” the minister informed the committee.

He additionally knowledgeable lawmakers that whereas the Ministry’s personnel finances for 2025 was absolutely launched and utilised, the capital element suffered extreme funding shortfalls, largely as a result of bottom-up money planning system operated by the Workplace of the Accountant-Basic of the Federation.

The minister additional defined that delays within the launch of Nigeria’s counterpart contributions to donor-supported well being programmes additionally prevented the Ministry from accessing sure counterpart funds, compounding implementation challenges. In keeping with him, the mixed impact of those components stalled the execution of the 2025 capital finances, regardless of the Ministry’s readiness to roll out initiatives and interventions.

The PidomNigeria additionally learnt that the Federal Ministry of Transportation obtained solely about one per cent of its N256.73bn capital allocation below the 2025 Appropriation Act.

The Minister of Transportation, Senator Saidu Alkali, made this recognized in Abuja throughout the ministry’s finances defence earlier than the Joint Senate and Home of Representatives Committee on Land Transport.

He famous that the 2026 proposal basically builds on the 2025 finances, as almost 70 per cent of initiatives needed to be carried ahead into the brand new fiscal yr due to funding shortfalls and delayed releases.

In keeping with him, the initiatives that rolled over have been reassessed and aligned with President Bola Tinubu’s Renewed Hope Agenda, with precedence on finishing ongoing works, safeguarding present public investments, and sustaining progress within the land transport sector.

Offering particulars on implementation, Alkali said that overhead utilisation in 2025 stood at about 59 per cent, whereas capital releases have been round one per cent and, most often, weren’t supported by precise money disbursements.

The PidomNigeria additionally reported that the Federal Ministry of Marine and Blue Financial system obtained solely N202m of its N3.53bn capital finances allocation in 2025, representing simply 1.7 per cent of budgeted funds, whereas overhead releases stood at 35 per cent.

The Minister of Marine and Blue Financial system, Adegboyega Oyetola, stated this whereas defending the ministry’s finances earlier than a joint sitting of the Senate Committee on Marine Transport and the Home of Representatives Committees on Ports and Harbours; Maritime Security, Training and Administration; Transport Providers; and Inland Waterways, Ocean and Fisheries.

Oyetola additionally stated engagements have been ongoing with the Ministry of Price range and Financial Planning to handle funding gaps, according to the Federal Authorities’s drive to diversify the economic system by way of the blue economic system.

The Minister of Women Affairs and Social Growth, Imaan Sulaiman-Ibrahim, additionally lamented the zero launch of the capital element of the ministry’s 2025 finances.

Sulaiman-Ibrahim, on Monday, appeared earlier than the Senate Committee on Ladies Affairs to defend the ministry’s 2025 finances efficiency and proposal for the 2026 fiscal yr.

In keeping with her, of the N89.8bn authorized for capital expenditure for 2025, solely N394.8m was launched. This, she stated, represented 0.44 per cent launch, with 99.56 per cent not launched, a growth the minister attributed to non-performance of the ministry’s capital initiatives.

The PidomNigeria additionally reported that the Accountant-Basic of the Federation, Dr Shamseldeen Ogunjimi, got here below intense scrutiny because the Senate Committee on Finance grilled him over zero capital allocations to a number of MDAs, non-payment of executed contracts, and complaints surrounding the Centralised Cost System.

The confrontation unfolded throughout the AGF’s finances defence session, the place lawmakers expressed outrage over what they described as poor fund releases, poor finances implementation, and mounting contractor money owed throughout MDAs and statutory our bodies.

From his opening remarks, the Chairman of the Committee, Senator Sani Musa (Niger East), set the tone for a tense session, accusing the Workplace of the Accountant-Basic of sustaining an “unfriendly” posture in the direction of the committee.

“We aren’t going to take your finances till we’re glad that your workplace is able to do issues that may make issues work for Nigerians by way of anticipated assurances from you.

“One of many points that should be urgently resolved is the envelope budgeting system being utilized by the federal authorities yearly however not producing desired outcomes, requiring an alternate mannequin like a performance-based one,” he stated.

Senator Danjuma Goje (Gombe Central) stated the legislature and Nigerians have been embarrassed by the poor stage of finances implementation since 2024, noting an unprecedented surge in complaints from contractors over unpaid jobs.

“Right here on the Nationwide Meeting, we’ve by no means seen contractors bombarding us weekly for intervention on non-payment of executed contracts.

“Impression given to Nigerians and us and Nigerians by the federal government is that with the removing of subsidy and harmonisation of foreign exchange market, extra income or more cash, the place is the cash now? Why are contractors owed? And why was there zero allocation for capital votes of a lot of the MDAs in 2025?” he queried.

Goje described the state of affairs as “very embarrassing and baffling.”

Responding, Ogunjimi attributed the disaster to what he described as indiscriminate contract awards by MDAs with out confirmed funding, prompting a directive barring companies from awarding contracts with out obtainable funds.

“Sure, because the Accountant-Basic of the Federation, my workplace is predicted to disburse funds to related companies on the acceptable time, however that may solely be performed if the fund is accessible as a result of I should have the funds earlier than I can disburse.

“I additionally wish to remind us that ‘Methods and Means’ used up to now for such funding isn’t any extra for the great of the Nation’s economic system,” he stated.

He acknowledged operational challenges with the Centralised Cost System however assured lawmakers that the problems have been being addressed to make sure seamless implementation.

Legislative marketing consultant Akinloye Oyeniyi has accused the Ministry of Finance of intentionally favouring recurrent spending over capital releases, arguing that the strategy is slowing growth and depriving Nigerians of the advantages of authorized budgets.

Talking on ARISE NEWS just lately, he alleged that MDAs are being denied funds for infrastructure and different initiatives, at the same time as salaries and administrative bills proceed to be paid, including that accountability finally rests with the Presidency and the finance authorities.

“The issue is coming from the ministry. I’ve to inform you, it’s coming from the ministry. It’s not coming from wherever. It’s from the ministry. It’s from the Ministry of Finance,” he stated, dismissing earlier claims that blamed the previous Accountant Basic for the delays.

Oyeniyi famous that the Nationwide Meeting has repeatedly summoned finance officers to clarify the low capital releases and warned that the state of affairs has compelled repeated finances consolidations and rollovers. He additionally referenced protests by contractors who declare they’re owed giant sums as a result of the federal government has not paid for executed initiatives, insisting that the sample of withholding capital votes has continued into 2025.

In keeping with him, the ministry is prioritising recurrent obligations to keep away from unrest, arguing that delaying capital initiatives attracts criticism however doesn’t instantly disrupt authorities operations, not like unpaid salaries.

“While you maintain on to the capital, it won’t completely have an effect on the workings of the federal government. It can solely paint a foul image of the federal government to the populace. However while you maintain on to the present, there may be going to be a disaster,” he stated.

Nonetheless, the Minister of Price range and Financial Planning, Senator Abubakar Bagudu, earlier dismissed claims that the Federal Authorities’s finances is in disarray, insisting that whereas income pressures exist, the fiscal state of affairs isn’t uncommon.

Talking final Wednesday on ARISE NEWS, Bagudu rejected assertions that the 2025 finances was in “shambles,” saying: “The finances, which you stated is in shambles, no, I disagree with you.”

He added that Nigeria, like many democracies, is contending with income constraints and competing expenditure calls for. “We’re like many international locations, we’re battling many pressures to lift income to the place it ought to fund our finances to 100 per cent, to make sure that we meet our obligations, notably debt service.”

He defined that world financial headwinds have been additionally affecting income flows and finances planning, noting that income and expenditure mismatches will not be peculiar to Nigeria, describing them as “a truth of life in any finances system, notably in a democratic system.”

He identified that even superior economies have confronted related challenges, citing situations of finances shutdowns overseas, and recalled that capital finances implementation had traditionally been weak in some years.

“In some years, even when oil costs have been 147, our capital finances efficiency was considerably decrease than 40 per cent,” he stated, arguing that the present state of affairs should be seen inside a broader historic context.

The minister maintained that the administration’s reforms have been designed to stabilise public funds and enhance income technology throughout all tiers of presidency. Whereas acknowledging that “we’re not the place we wish to be,” he harassed that the federal government was taking steps to strengthen fiscal efficiency.