By: Tijani Salako.
The Federal Government has dismissed claims that more than two per cent of Nigeria’s Gross Domestic Product (GDP) was spent outside the approved 2026 budget, describing the allegations as misleading and a misrepresentation of the International Monetary Fund’s (IMF) 2026 Article IV Consultation Report.
In a statement issued on Saturday by the Minister of Finance and coordinating minister for the economy Taiwo Oyedele, the Federal Ministry of Finance said the government does not operate a “shadow budget” and that all public expenditure is carried out within the constitutional and legal framework approved by the National Assembly.
The ministry explained that expenditures such as statutory transfers, debt servicing, security interventions, allocations to development commissions and multi-year capital projects are legally authorised and should not be interpreted as spending outside the budget. It added that differences in fiscal reporting under international standards do not amount to illegal expenditure or an increase in the fiscal deficit.
According to the government, the IMF’s observations relate primarily to improving the comprehensiveness, timing and presentation of fiscal reporting rather than questioning the legality of government expenditure. It added that Nigeria is continuing reforms to align its budget presentation with international fiscal reporting standards.
The ministry further stated that it is inaccurate to suggest that trillions of naira were secretly spent without legislative approval, stressing that such allegations should be supported with credible evidence identifying specific projects allegedly executed without appropriation or legal authority.
It explained that Nigeria’s public finance framework contains several statutory transfers, first-line charges and intervention mechanisms established by Acts of the National Assembly. These include statutory allocations and contributions to development commissions and other agencies created by law, cost of collection and administration retained by designated revenue-collecting agencies, capital expenditure approved in separate budgets for some agencies and the Federal Capital Territory, as well as special interventions for security, infrastructure, disaster response and other national priorities.
The ministry also noted that debt service obligations and other statutory transfers are authorised under applicable legislation and are neither secret nor illegal. According to the statement, these expenditures are disclosed in fiscal reports and are subject to oversight, audit and accountability mechanisms, although their presentation may differ from that in the annual Appropriation Act because of international reporting standards.
It further clarified that a fiscal deficit is determined by the relationship between total government revenue and total government expenditure, noting that financing capital projects through annual appropriations, supplementary budgets, statutory transfers or other lawful financing arrangements does not, by itself, increase the budget deficit.
The government added that ongoing public financial management reforms have strengthened budget credibility, improved revenue administration, enhanced the digitalisation of government financial processes and reinforced treasury management. It said these reforms have been recognised by the IMF, other multilateral institutions, international credit rating agencies, major media organisations and investors.
The Federal Government reaffirmed its commitment to prudent fiscal management, transparency and accountability, urging the public to base discussions on verified facts rather than speculation.
