- Former Vice President warns of escalating debt and weak fiscal discipline.
- Criticises focus on debt servicing over essential investments.
The 2023 presidential candidate of the Peoples Democratic Party (PDP), Atiku Abubakar, has criticized the 2025 budget proposal presented by President Bola Tinubu, describing it as unsustainable and devoid of the structural reforms necessary to tackle Nigeria’s economic challenges.
In a statement released on Sunday, Atiku highlighted significant flaws in the N47.9 trillion budget, including heavy borrowing, disproportionate debt servicing, and inadequate allocation for infrastructure and social sectors.
“The 2025 budget lacks the structural reforms and fiscal discipline required to address Nigeria’s multifaceted economic challenges,” Atiku stated. He pointed out that the budget’s projected revenue of N35 trillion leaves a staggering deficit of over N13 trillion, equivalent to 4% of the nation’s GDP.
A Debt-Driven Strategy
Atiku criticized the administration’s reliance on borrowing to fill the budget gap. “To bridge the deficit, the government plans to borrow over N13 trillion, including N9 trillion in direct loans and N4 trillion for project-specific financing,” he said. According to him, this approach continues the APC-led government’s trend of escalating public debt, which began in 2016.
Debt servicing, which is pegged at N15.8 trillion (33% of total expenditure), overshadows allocations for critical sectors such as defence (N4.91 trillion), infrastructure (N4.06 trillion), education (N3.52 trillion), and health (N2.48 trillion).
“This unsustainable debt cycle crowds out essential investments needed to drive growth and improve the lives of Nigerians,” Atiku argued.
Capital Expenditure and Governance Issues
The former vice president also pointed to the poor performance of the 2024 budget, which, by the third quarter, had disbursed less than 35% of its capital expenditure despite claims of 85% execution. He expressed skepticism about the government’s ability to meet its 2025 targets, especially with capital investment accounting for only 25% to 34% of the budget.
“At approximately N80,000 ($45) per capita, capital expenditure cannot adequately address Nigeria’s infrastructure needs or spur meaningful development,” Atiku noted.
He also condemned the high recurrent spending of N14 trillion (30% of the budget), which he said perpetuates inefficiencies and sustains an oversized bureaucracy.
Concerns Over VAT Increase
Atiku criticized the proposed increase in Value Added Tax (VAT) from 7.5% to 10%, describing it as a regressive measure that will deepen economic hardship for Nigerians.
“Raising taxes without addressing governance inefficiencies will stifle consumption and exacerbate the cost of living crisis. This approach risks widening economic disparities instead of alleviating them,” he warned.
Call for Structural Reforms
Atiku urged the government to adopt long-term fiscal sustainability measures, reduce waste, and prioritize governance reforms over excessive borrowing. He emphasized the need for a balanced approach that addresses Nigeria’s infrastructure deficits and social needs without mortgaging the country’s future.
As the debate over the 2025 budget continues, Atiku’s critique serves as a rallying call for Nigerians to demand accountability and transparency in public financial management.
