2025 Budget Faces Possible Extension as Treasury Freezes Fund Requests

Nigeria’s 2025 budget may run into 2026, as stalled capital projects, procurement delays, and a shutdown of the government’s cash-planning portal have brought new spending to a standstill barely eight months into the fiscal year.

The situation came to light at a stakeholders’ meeting in Abuja on Wednesday, convened by the Office of the Accountant-General of the Federation (OAGF) to review the progress and challenges in implementing the extended 2024 capital budget and the 2025 spending plan under the Bottom-Up Cash Planning Policy (BUCPP).

Under the policy, ministries, departments, and agencies (MDAs) are required to submit monthly cash plans via an OAGF portal before signing any contracts. These submissions are consolidated into a federal cash plan, approved by the Ministry of Finance, and backed with spending warrants before payment plans can be uploaded and funds released directly to contractors or beneficiaries.

However, since May, the portal has been locked for 2025 entries, preventing MDAs from submitting cash plans. Without these, warrants cannot be issued, and no payments can be made for new projects.

Treasury warns against spending without warrants
Accountant-General Shamseldeen Ogunjimi told the gathering that the BUCPP was designed to stop ministries from committing funds they do not have, accusing some MDAs of breaching procurement laws by awarding contracts simply because they appeared in the budget, without securing cash backing.

He criticised the practice of front-loading cash needs with staff-related costs while leaving ongoing projects unfunded, a situation he said has forced contractors to borrow at high interest rates and stalled priority works. Ogunjimi warned that no MDA can issue new contracts or process capital payments on the Government Integrated Financial Management Information System (GIFMIS) without a warrant.

Contracts already entered into and loaded on the portal with approved cash plans, he assured, would still be funded. But once the portal reopens, any fresh commitments will have to go through the revised process.

Finance and Budget Offices back stricter controls
Finance Minister Wale Edun supported the “warrant-first” approach, stressing that no award letters or contracts should be issued without matching warrants or Authorities to Incur Expenditure (AIEs). He said the policy was part of reforms to make public payments more transparent by paying suppliers and contractors directly.

Budget Office Director-General Tanimu Yakubu warned that Nigeria’s oil revenues had been severely hit by deductions under the Petroleum Industry Act 2022, with 60% of gross oil earnings now allocated to the Nigerian National Petroleum Company Limited and the Frontier Exploration Fund. Lower oil prices and production shortfalls in early 2025 have worsened the squeeze, he added.

Yakubu confirmed that early in the year, part of the 2025 revenue was used to fund the extended 2024 budget, forcing the government to classify projects into funding priority categories. He disclosed ongoing talks with lawmakers to amend the PIA and recover some lost revenue.

Procurement and audit officials demand compliance
The Bureau of Public Procurement’s Director-General, Adebowale Adedokun, said projects without adequate warrants or planning would no longer be certified, reminding MDAs that mobilisation fees are capped at 30% under the Finance Act. Auditor-General Shaakaa Chira warned that accounting officers would be held personally accountable for breaches.

Officials from the Revenue Mobilisation Allocation and Fiscal Commission stressed the need to boost revenue, noting that monthly allocations to states have risen sharply from about ₦700bn in 2022–2023 to ₦1.7tn this year.

Portal reopening date uncertain
Despite repeated appeals from MDA representatives — some warning that seasonal programmes such as fertiliser distribution could miss critical windows — no reopening date for the 2025 cash plan portal was given. Agriculture officials and others complained that contractors are increasingly refusing award letters without cash backing.

With the capital component of the 2024 budget already extended to December 31, 2025, senior officials admitted that rolling over the 2025 budget into the next fiscal year may be unavoidable. Some economists warn that running two capital budgets at the same time could encourage duplication and weaken transparency in project delivery.