FG Denies ₦8tn ‘Shadow Budget’ Claims, Says All Spending Backed by Law

In a statement issued by the Honourable Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, clarified that Nigeria does not operate a “shadow budget” and that all public expenditures are made within the constitutional and legal framework governing public finance.

The clarification followed public commentary linking the IMF’s 2026 Article IV Consultation Report to allegations that about two per cent of Nigeria’s Gross Domestic Product (GDP), estimated at over ₦8 trillion, was spent outside legislative approval.

According to the minister, Sections 80 to 83 and 162 of the 1999 Constitution (as amended) clearly stipulate that public funds can only be withdrawn and spent in accordance with laws enacted by the National Assembly.

He explained that federal expenditures are executed through duly approved Appropriation Acts, Supplementary Appropriation Acts and other statutory authorisations, while multi-year capital projects are implemented under existing legal provisions that permit capital rollovers where necessary.

Oyedele stressed that there was no evidence of secret or unlawful spending, noting that anyone making such allegations should identify the specific projects allegedly executed without legislative approval and provide verifiable proof.

The minister further explained that Nigeria’s public finance system includes statutory transfers, first-line charges and intervention mechanisms established by Acts of the National Assembly. These cover allocations to development commissions, revenue collection costs, debt servicing, security interventions, infrastructure projects, disaster response and other strategic national programmes.

He noted that while these expenditures may be presented differently under international fiscal reporting standards, they remain lawful, transparent and subject to oversight and audit.

The government also rejected suggestions that the reported amount reflected an increase in Nigeria’s fiscal deficit, explaining that budget deficits are determined by the balance between total government revenue and expenditure rather than the financing mechanism for approved projects.

According to Oyedele, the IMF’s observations focused primarily on improving the comprehensiveness and presentation of Nigeria’s fiscal reporting rather than questioning the legality of government spending.

He recalled that President Bola Ahmed Tinubu had already requested the National Assembly to harmonise multiple and overlapping budgets into a single, unified fiscal framework during the presentation of the 2026 Appropriation Bill in December 2025.

The minister said the Federal Government remains committed to prudent fiscal management, transparency and accountability, adding that ongoing reforms in budget credibility, revenue administration, treasury management and digitalisation of public financial processes have received positive recognition from the IMF and other international institutions.

He urged Nigerians to base public discourse on verified facts and a proper understanding of the country’s fiscal and constitutional framework, warning that misrepresenting technical fiscal observations undermines informed democratic debate.

Oyedele reaffirmed the Federal Government’s commitment to strengthening fiscal governance, maintaining transparency in public resource management and working with the National Assembly, oversight institutions and development partners to improve Nigeria’s public finance system in line with international best practices.