Calls for Urgent Funding of Capital Projects to Spur Development
Don’t Let Nigeria Suffer the Fate of Germany, France – Wale Edun Warns
The National Assembly has expressed dissatisfaction with the 43% execution rate of capital projects in the 2024 budget, describing it as inadequate to drive economic and infrastructural development.
During a joint sitting of the Senate and House Committees on Appropriations and the Presidential Economic Team, lawmakers criticized the disparity between recurrent and capital expenditure, urging the Ministry of Finance to urgently release funds to improve capital project implementation.
The report presented by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, revealed that while recurrent expenditure achieved 100% execution, capital expenditure stood at only 25%.
Lawmakers Call for Balanced Budget Allocation
Senator Solomon Adeola, Chairman of the Senate Committee on Appropriation, advocated for a reduction in the recurrent-to-capital expenditure ratio from the current 80:20 to at least 60:40.
“Capital releases to MDAs are the major drivers of economic activities within the nation. Non-release of funds for capital projects is a major issue in the performance of the 2024 Budget so far,” Adeola said.
He stressed the importance of releasing funds to prevent abandoned projects and ensure the success of President Bola Tinubu’s Renewed Hope Agenda.
Hon. Abubakar Birchi, Chairman of the House of Representatives Committee on Appropriation, emphasized the critical role of capital projects like schools, roads, hospitals, and dams in directly impacting over 200 million Nigerians.
“Recurrent expenditure benefits only a small fraction of the population, while capital projects address the broader needs of our people,” Birchi noted, suggesting that debt repayment items could be restructured to free up funds.
Warnings from the Finance Minister
Wale Edun warned against returning to unsustainable spending practices that could lead to economic repercussions similar to those in France and Germany.
“There are warrants awaiting payment for capital projects, but we must avoid the backlash of spending money that is not there,” Edun stated.
Legacy Challenges and Reforms
Minister of Budget and Planning, Abubakar Bagudu, attributed the high recurrent expenditure to developmental challenges and the military’s campaign against insecurity. He noted that these efforts have improved agricultural and economic activities.
The Director General of the Budget Office, Dr. Tanimu Yakubu, pointed to inherited obligations such as unpaid pensions and gratuities as significant contributors to recurrent costs. Yakubu also called for legislation to cap recurrent expenditure in future budgets.
Next Steps
The meeting, attended by key officials including the Minister of State for Finance, Dr. Doris Uzoka-Anite, and permanent secretaries from the Ministries of Finance and Budget, also discussed revenue challenges stemming from waivers and tax holidays.
Lawmakers and the economic team agreed on the urgency of addressing these imbalances to ensure the 2025 Appropriation Bill delivers on the administration’s promises of economic growth and improved infrastructure.
The National Assembly reiterated its commitment to working with the executive to address fiscal challenges and ensure that future budgets prioritize the well-being of Nigerians.
