Experts Back Federal Government’s 70% 2025 Capital Budget Rollover

The federal government’s decision to roll over 70 per cent of the 2025 capital budget into the 2026 fiscal year has received strong backing from economists and industry experts, who argue the move will help eliminate abandoned projects and promote continuity in government spending.

However, the directive has sparked sharp criticism from labour unions, who warn that delaying payments to contractors and extending project timelines could worsen poverty and stall economic activity.
The federal government gave the directive in its 2026 Abridged Budget Call Circular, instructing ministries, departments, and agencies (MDAs) to carry over the bulk of their 2025 capital allocations into the next year to prioritise completing existing projects amid weak revenue prospects.

The 2026 Abridged Budget Call Circular was issued by the Federal Ministry of Budget and Economic Planning and circulated to all ministers, service chiefs, heads of agencies and top government officials in Abuja.

The circular, according to The Punch, stated that, the annual budget estimates must follow strict guidelines and that all officers responsible for budget preparation were expected to comply fully. The circular made clear that the preparations for the 2026 budget would not allow the introduction of new capital projects.

It stated that ministries and agencies must continue with the allocations already approved in the 2025 budget rather than seeking fresh projects. The document said MDAs are required to upload 70 per cent of their 2025 budget to continue next year, and that this must be done in line with national priorities.
Commenting on the directive, the chief executive of the Center for the Promotion of Private Enterprise (CPPE) , Dr. Muda Yusuf said, the move is an assent to clean up the process because it has been untidy in the past. He said, instead of rolling over abandoned projects, it was important to clear the backlog of abandoned projects.

Yusuf also noted that, the Medium-Term Expenditure Framework (MTEF) assumes a more realistic role in terms of new revenue projections. He stressed that the previous MTEF was based on unrealistic assumptions, which made it difficult to achieve its goals, adding that the current revenue projections align with reality.

Fiscal policy analyst, Dr. Peter Adediran described the directive as ‘a necessary but painful fiscal consolidation measure.’

He noted that, the government’s revenue profile has become too weak to sustain fresh capital spending without amplifying deficit levels.

“If revenue is stagnant and debt service continues to take up a significant share of government earnings, then prioritising ongoing projects is the most rational thing to do.

However, this also exposes the structural weakness of Nigeria’s public finance system; we are rolling over because we can’t fund what we have already started, not because we are planning more efficiently.”

University Don, Dr. Samson Olaleye, said, “For the first time in a long time, we are seeing an attempt to enforce discipline in capital budgeting. Nigeria has over 13,000 uncompleted projects, some dating back a decade. Insisting that MDAs continue with existing allocations rather than introducing new ones aligns fully with global best practices.”

However, he cautioned that, the success of the policy will depend heavily on strict monitoring and transparent reporting.

“It will only work if project monitoring improves. Rolling over allocations without improving oversight will simply roll over inefficiencies,” he said.

He also noted that inflation could make the fixed ceilings unrealistic, urging the government to consider a mechanism for adjusting project costs without breaching fiscal sustainability thresholds.

Meanwhile, Professor Tayo Bello, while. commenting on the development said, transferring of capital projects or expenditures from this fiscal period to 2026 “is a quasi way of telling people that government is broke. That is, they cannot finance their capital expenditure.”

Asides this, he said, “the government revenue has simply declined or is declining. The government does not want a situation where new projects will have to be introduced next year, that’s 2026. It means they want to complete the projects they earmarked, the capital projects for this year, they started this year, to be completed in 2026.”

Professor Bello furthered that the government is also likely “trying to look into what is called infrastructure sustainability, both the soft infrastructure and hard infrastructure. What are the hard infrastructures? Road constructions, railway, airport, buildings. The soft are schools, healthcare system.

Okay, they want a situation where they will be able to tackle that.

“Also, debt service next year will definitely increase. I think because servicing debt will increase, and they have to take note of that.

“Finally, they don’t want to gamble. If you constitute a gambling terrain by saying this project, you are going to do this, it means a lot of projects will be abandoned. And it is a way of telling the MDGs: don’t bring new projects. The ones you have submitted that we are executing. Thirty percent is the one that you can spend. The balance of 70 per cent is what they are going to spend next year.”

However, a unionist in the Nigerian Labour Congress (NLC), Comrade Victor Oriola, while speaking to our correspondent on Tuesday, described this move as a setback.

According to Oriola, “this is not the first time of having rollover budgetary implementation, which could be detrimental because many things will be tied down. Contractors are not going to be paid. With over N500billion belonging to contractors tied down, there will not be free flow of cash in circulation.

“Another implication is that, poverty will be on the rise as some people, who will have benefitted from increased government projects implementation will be out of job even as it also obstruct cash flow.”

Moreover, he stressed that, “there is nothing new after all the rollover from 2022 and this latest move to shift it into 2026 is a continuation of what has been in existence. The main problem is more hardship that could arise. as it will deny some people of cash flow.

“We saw how contractors protested some months ago over non-release of their payment and if government can pay N500billion to contractors, the multiplier effect will ensure there is money in circulation.”

Another respondent, who simply identified himself as Alhaji Aliko Danko, said, “pushing the implementation into 2026 is another way of delaying fulfilment of promised democratic dividend as some people will be economically stranded due to this plan. Since it is called 2025 budget, it should be made to be used without pushing it over into another year.”