The federal government has unveiled a great shift in Nigeria’s fiscal strategy, moving away from heavy reliance on borrowing towards the mobilisation of mass domestic savings as a sustainable response to the nation’s rising debt burden.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, disclosed the new approach during an interactive session on the 2026–2028 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP), hosted by the Senate Committee on Finance at the National Assembly.
Edun said the policy pivot was essential in light of persistent revenue shortfalls, mounting fiscal pressures, and the need to strengthen domestic capital formation without further swelling public debt.
According to the minister, Nigeria’s total public debt has soared to around N152 trillion, up from approximately N70 trillion in 2023, but a large portion of the increase did not stem from new borrowing.
He explained that N30 trillion arose from the formal recognition and regularisation of Ways and Means financing previously excluded from government accounts, while nearly N50 trillion resulted from exchange rate adjustments following central bank reforms to clear foreign exchange backlogs and rebuild external reserves.
“Consequently, about N80 trillion of the total debt stock did not represent new borrowing, but rather a process of reclassification, regularisation and adjustment,” Edun said.
The minister stressed that the MTEF would now prioritise revenue mobilisation, fiscal discipline, and long-term sustainability over borrowing.
He cited persistent gaps between projected and actual revenues, saying that in 2024, estimated revenue of N25.9 trillion fell short at N8.27 trillion, while 2025 projections of N40 trillion yielded only N10 trillion.
“As a result, treasury management measures and borrowing were used to bridge funding gaps. This underscores the urgency of a more realistic and robust revenue framework going into 2026,” he said.
Edun revealed a comprehensive revenue optimisation programme, leveraging automation, digitalisation, technology deployment, and process re-engineering.
Four circulars, he added, have already directed revenue and investment-generating ministries, departments, and agencies (MDAs) to migrate to transparent digital platforms, cease cash collections, and remit revenues directly to the Treasury Single Account.
Regarding budget implementation, Edun said the 2024 capital budget had been extended into 2025, with funding available for completed projects, while 70 per cent of 2025 capital projects would be rolled over into 2026, pending National Assembly approval.
Despite revenue challenges, he insisted the government had met critical obligations including salaries, pensions, statutory transfers, and debt servicing.
Edun upheld that long-term growth required broad-based mobilisation of domestic savings, given that around 90 per cent of economic activity is private sector-driven.
He revealed plans for a public-private partnership initiative, under consideration by President Bola Tinubu, to encourage tens of millions of Nigerians to save and invest productively, generating domestic capital and reducing reliance on government borrowing.
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