By Emeka Anaeto, Business Editor and Peter Egwuatu, Assistant Business Editor

Private sector operators and financial analysts have stepped up criticism of multiple budget system run by the Federal Government, pointing at the grave consequences to transparence, financial discipline and fiscal responsibility.

Recall that in a major move to resolve Nigeria’s persistent “overlapping budget” crisis, the Federal Government, last week, officially announced a massive 70% rollover of the 2025 capital budget into the 2026 fiscal year.

This comes amidst on-going implementation of the capital component of the 2024 budget which will likely enter into 2026.

Also the decision on 2025 budget effectively means that the 2025 budget implementation has been extended, and its uncompleted projects will form the foundation of the 2026 spending plan.

The announcement was made through the 2026 Abridged Budget Call Circular and further clarified by the Minister of Finance, Wale Edun, during sessions with the National Assembly.

It undermines credibility, discipline- Dada
Speaking to Saturday Vanguard on the development, Mr Oluropo Dada, President of the Chartered Institute of Stockbroker, CIS, said: “Having multiple budgets within one fiscal year carries grave implications for Nigeria’s economy.
‘‘First, it undermines fiscal credibility and discipline. Frequent revisions often reflect weak planning assumptions particularly around oil prices, exchange rates, and revenue projections, thereby reducing investor confidence.

‘‘Second, it creates uncertainty for businesses, making it difficult for the private sector to plan investments, employment, and pricing decisions.
‘‘Third, it exacerbates implementation challenges. Executing even a single budget is already difficult in Nigeria; multiple budgets further slow project delivery and increase the risk of abandoned or duplicated projects.

‘‘Fourth, it typically widens fiscal deficits and increases borrowing, raising debt-service costs and crowding out private sector credit.
“While budget revisions may be necessary during major economic shocks, making them routine points to structural weaknesses in fiscal planning and coordination. Nigeria’s priority should be more realistic budgeting, stronger medium-term planning, and better execution, rather than frequent budget rewrites”.

Irregular budget implementation calls for fundamental rethink- Yusuf

Commenting, Dr Muda Yusuf, Chief Executive Officer, Centre for the Promotion of Private Enterprise said: “Nigeria’s persistent challenge of irregular budget implementation, particularly in capital expenditure, calls for a fundamental rethink of the budgeting process.

‘‘The proposal by the President should be understood as an attempt to regularise years of uneven and incomplete budget execution, rather than an abandonment of past commitments.
‘‘Rather than discarding projects that were approved but not implemented, it is more prudent to consolidate outstanding projects, clear the accumulated backlog, and re-present them within a more coherent and credible framework.

‘‘This approach provides an opportunity to reset the system and break the recurring cycle of rolled-over budgets, especially capital budgets that undermine development outcomes and public confidence’’.

Addressing this challenge, Yusuf said it requires a holistic reform of the budget process, not ad hoc adjustments.

He stated: ‘‘Central to this reform is the need to ensure that budget assumptions are realistic, particularly with respect to revenue projections; Align expenditure plans strictly with credible revenue expectations; Avoid overly optimistic projections that inevitably lead to weak implementation and mounting arrears and align expenditure priorities with critical developmental and productivity aspirations.
“Without realism at the foundation, budgets will continue to exist largely as academic exercises rather than instruments for delivering tangible outcomes.”
The CPPE boss also said that Nigeria needs a budget that inspires trust, one that citizens, investors, and Ministries, Departments and Agencies (MDAs) can regard as a genuine commitment to delivery.

He stated: ‘‘Budget credibility is essential for improving compliance by MDAs; Strengthening legislative oversight, and enhancing public confidence in fiscal governance. A credible budget must be perceived not merely as an appropriation document, but as a realistic promise of outcomes’’.

Yusuf added, “The Appropriation Act is a law and carries full legal significance. Compliance with it is not optional. ‘‘However, legal compliance is only meaningful when the budget itself is anchored on solid foundations and realistic assumptions. A law that is structurally flawed or fiscally unrealistic will inevitably face implementation failures.
“What is required is not just a one-off adjustment, but a comprehensive overhaul of Nigeria’s budget framework. ‘‘The President’s proposal represents a step in the right direction, but its success will depend on ensuring that budget rollovers do not become a permanent feature, Non-implementation is decisively addressed, Fiscal realism, credibility, and sustainability guide future budgets. Only then can the budget function as a true instrument of development, trust, and effective governance.

Multiple budget subverts appropriation law- Adonri

Also commenting, David Adonri, Analyst and Vice Executive Chairman at High Cap Securities Limited, an investment firm said: “It is a misnomer for any organization to run multiple budgets in the same appropriation period. For a statutory authority, running multiple budgets in the same appropriation period subverts the appropriation law for such period. It is an impeachable offence.
He stated further: “This kind of malpractice is commonly referred to as fiscal indiscipline. It is a very chaotic situation”.

Budget overlap weakens constitutional principle of annual budgeting- Egbomeade

Speaking to Saturday Vanguard on the matter, Clifford Egbomeade, Public Affairs and Communications expert, said: “Having more than one budget operating within a single fiscal year has well-documented fiscal and institutional consequences, and these concerns are grounded in Nigeria’s recent public finance experience rather than conjecture. In Nigeria, delayed passage of annual budgets and late releases of capital funds have meant that capital components of one year’s Appropriation Act often spill into the next fiscal year. ‘‘This overlap has been acknowledged repeatedly by the executive and the National Assembly, including during debates around the repeal and re-enactment of the 2024–2025 budget framework in December 2025. Such overlap weakens the constitutional principle of annual budgeting, under which revenues and expenditures are meant to be planned, approved, and executed within a clearly defined twelve-month period.
“A central consequence is reduced fiscal clarity and weaker accountability. When ministries, departments, and agencies are authorised to spend under different appropriation laws at the same time, tracking performance against approved allocations becomes more difficult for legislators and auditors.

‘‘Nigeria’s budget implementation reports and Auditor-General reviews over recent years consistently show that delayed releases and extended capital rollovers complicate oversight and blur responsibility for project delays or cost overruns.

‘‘This challenge does not imply illegality, but rather administrative opacity, which makes it harder to assess whether spending outcomes align with legislative intent.
“Multiple budgets within one fiscal year also complicate cash management and debt planning. Nigeria’s debt service obligations have risen steadily in recent years, with official budget documents showing allocations of over N8 trillion for debt service in the 2025 fiscal framework.

‘‘When spending authorities overlap across fiscal periods, treasury managers must meet clustered obligations while revenues remain uncertain and unevenly distributed through the year.

‘‘This situation increases short-term financing pressures and makes expenditure prioritisation more difficult, even when borrowing decisions remain within approved legal limits.
“Finally, overlapping budgets weaken policy signalling and public confidence in the budget process. Investors, development partners, and citizens rely on a clear budget cycle to understand government priorities and assess fiscal sustainability.

‘‘The Tinubu administration’s request in December 2025 to repeal and re-enact the existing appropriation framework explicitly recognised that running multiple budgets concurrently has historically undermined budget clarity and implementation discipline.

‘‘A single, consolidated budget cycle improves transparency, strengthens legislative oversight, and allows capital projects to be planned and executed within a more predictable fiscal environment, which is essential for macroeconomic stability and effective public financial management”.

It gives room for unreliability of policies, erode investor confidence- Adenagbe

Commenting on the multiple budget relating to the impact on the capital market, Sehinde Adenagbe, Chairman, Association of Stockbroking Houses of Nigeria, ASHON, said: “In the Nigerian capital market, revised budgets usually mean unplanned increases in government securities issuance.

‘‘Higher yields on Treasury bills and bonds can crowd out private sector participation, divert funds away from equities, and raise the cost of capital for listed companies.

‘‘Over time this weakens market depth and limits the ability of the stock market to support economic growth.
“Policy predictability enables the capital to play its rightful role in mobilising long-term fund and supporting economic growth and development.

‘‘A credible and well-structured annual budget is one of the assurances the government can give investors.
‘‘In addition, running multiple budgets within a fiscal year, invariably gives room for unreliability of policies. It easily erodes investor confidence and increases apprehension. It leads to scarce investable funds among the local investors”.

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