The Federal Government has dismissed claims that it operates a shadow budget, insisting that all public spending is carried out within the constitutional and legal framework governing public finance in Nigeria.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, made the clarification in a statement issued on Monday in Abuja while responding to comments by the International Monetary Fund (IMF) on Nigeria’s fiscal operations.
The IMF Resident Representative in Nigeria, Christian Ebeke, reportedly stated that government spending amounting to about 2 percent of the country’s Gross Domestic Product (GDP) was not formally captured in recent national budgets.
According to Ebeke, the expenditure was largely tied to major infrastructure projects executed outside the formal budget framework, a practice he said understated Nigeria’s fiscal deficit, concealed its financing requirements and reduced fiscal transparency.
Reacting to the claims, Oyedele described the allegations as inaccurate and misleading.
“The Federal Government has noted recent public commentary alleging that approximately two per cent of GDP, amounting to over N8 trillion, was spent outside the approved budget. These claims are incorrect and risk misleading the public regarding the government’s financial management,” he said.
The minister stressed that under Sections 80 to 83 and Section 162 of the 1999 Constitution, as amended, public funds can only be withdrawn and spent in accordance with constitutional provisions and laws enacted by the National Assembly.
He explained that all Federal Government expenditure is undertaken through duly enacted Appropriation Acts, Supplementary Appropriation Acts and other statutory authorisations approved by the National Assembly.
Oyedele added that multi-year capital projects, which often extend beyond a single fiscal year, are implemented in accordance with existing laws and, where applicable, approved capital rollover provisions.
He said such projects are recognised components of public financial management and should not be interpreted as spending outside the approved budget.
“It is inaccurate to suggest that trillions of naira have been secretly spent outside legislative approval,” he said.
“Such allegations should identify the specific projects purportedly executed without appropriation or legal authority and provide credible evidence in support of the claim.”
The minister further explained that Nigeria’s public finance framework includes several statutory transfers, first-line charges and intervention mechanisms established by Acts of the National Assembly.
According to him, these include statutory allocations to development commissions and government agencies, cost of collection retained by designated revenue-generating agencies, capital expenditure approved under separate budgets for certain agencies and the Federal Capital Territory, special intervention programmes approved by law, as well as debt servicing obligations.
Oyedele maintained that these expenditures are lawful, publicly disclosed and subject to legislative oversight, audit and accountability mechanisms.
He noted that although some expenditures may be presented differently under international fiscal reporting standards, such classification differences should not be misconstrued as evidence of unlawful or off-budget spending.
