Low capital project funding is criticized by the National Assembly.

The 2024 budget's large disparity between recurring and capital expenditures alarmed the National Assembly on Wednesday, which pointed to the low amount of funds released for capital projects as a key barrier to real progress.

Senator Solomon Adeola and Hon. Abubakar Bichi demanded more money for capital projects in the current 2024 budget during a joint session of the Senate and House Appropriations Committee Chairmen and the Presidential Economic Team to examine the 2025 Appropriation Bill.
They maintained that since ongoing expenditures mostly benefit a small portion of the population, capital projects are the most direct means for Nigerians to gain from government initiatives.

The 2024 budget's large disparity between recurring and capital expenditures alarmed the National Assembly on Wednesday, which pointed to the low amount of funds released for capital projects as a key barrier to real progress.

Senator Solomon Adeola and Hon. Abubakar Bichi demanded more money for capital projects in the current 2024 budget during a joint session of the Senate and House Appropriations Committee Chairmen and the Presidential Economic Team to examine the 2025 Appropriation Bill.
They maintained that since ongoing expenditures mostly benefit a small portion of the population, capital projects are the most direct means for Nigerians to gain from government initiatives.

In contrast to the current 80:20 ratio between recurring and capital spending, Senator Adeola, who represents the Ogun West Senatorial District, called for a radical change in the budget structure.

"Across the country, capital releases to MDAs propel economic activity and growth. One of the main causes of the 2024 budget's subpar performance thus far is the non-release of money for major projects. To prevent abandoned initiatives and guarantee the Renewed Hope Agenda's success, funds must be made available," Adeola said.

He emphasized that MDAs should not bring a history of subpar capital mandate implementation to their 2025 budget defense.

These views were reinforced by Bichi, who emphasized the disproportionate effect of ongoing expenses.

 Only around 10% of the population directly benefits from the majority of recurring expenditure items, despite their near-perfect implementation. On the other hand, the bulk of Nigeria's 200 million+ citizens directly benefit from capital projects in the fields of healthcare, education, infrastructure, and electricity," he stated.

While acknowledging the backlog of capital releases that need funding, Edun, the finance minister, issued a warning against returning to unsustainable spending patterns, citing the recent fiscal crises in Germany and France as examples.
Atiku Bagudu, the Minister of Budget and National Planning, blamed the high recurring expenses on Nigeria's legacy problems, such insecurity, and developmental obstacles, which continue to put a burden on the country's resources.

Bagudu pointed out that instability has exacerbated budgetary difficulties by negatively affecting agriculture and other economic sectors.

Tanimu Yakubu, the director general of the budget office, pointed to unpaid pensions and gratuities that President Tinubu's administration inherited as major causes of ongoing expenses.

Although he acknowledged that pension liabilities had been addressed, he recommended that future budgets may require the National Assembly to enact legislation limiting recurring expenses.

Concerns over tax breaks and holidays were also discussed at the meeting, which was attended by Doris Uzoka-Anite, the Minister of State for Finance, as well as permanent secretaries from the Ministries of Finance, Budget, and National Planning.

Participants cautioned that if these measures are not properly managed, they may further reduce government revenue.