Nigeria’s 2026 budget: Big numbers, blurred lines, and the cost of overlap

President Bola Ahmed Tinubu has signed the 2026 Appropriation Act into law. The headline figure is N68.32 trillion. That should mark a clear, decisive moment for Nigeria’s finances. But it does not. Here is the problem: the 2025 capital budget has been extended to run until June 30, 2026. That means for several months, two […]

President Bola Ahmed Tinubu has signed the 2026 Appropriation Act into law. The headline figure is N68.32 trillion. That should mark a clear, decisive moment for Nigeria’s finances. But it does not. Here is the problem: the 2025 capital budget has been extended to run until June 30, 2026. That means for several months, two budgets—one old, one new—will be running side by side. What we have is not a clean fiscal year. What we have is a blurred overlap of obligations stretching from 2024 through 2026. The budget is ambitious in size, but uncertain in structure.

This is not a small technical issue. Budgets are meant to be instruments of discipline. When fiscal years overlap, that discipline weakens. Who is accountable for delays? Which projects belong to which budget? Is poor performance due to bad planning, slow execution, or shifting priorities? In Nigeria’s case, extending the 2025 capital budget into 2026 shows that the system has not yet fixed its long-standing problem of getting things done on time. The result is a budget that looks impressive at first glance but raises serious questions about how it will actually be implemented.

Let us look at the figure again: N68.32 trillion. Not long ago, Nigeria’s budgets were in the low twenties of trillions. Now we are approaching N70 trillion. Some of this growth is due to inflation and the falling value of the naira. But size alone is not strength. The real question is whether the system behind this huge number is strong enough to deliver real results. Past experience suggests it is not. Too many past budgets have been expansive on paper but thin on the ground. We have seen this pattern before, and it is not one that inspires confidence.

The budget allocates about N32.2 trillion—roughly half—to capital expenditure. That sounds good. It suggests a serious focus on infrastructure, security, and development. But Nigeria’s problem has never been announcing large capital votes. Our problem has always been turning those votes into finished roads, working power projects, and functional public buildings. Roads are budgeted but not finished. Power projects are funded but not delivered. Public buildings begin with fanfare and linger at “advanced stages” for years. The repeated extension of capital budgets does not fix this pattern. It reinforces it. And that is where the real frustration lies.

There is another structural concern: debt service. The government will spend N15.8 trillion just to service debt. That is almost exactly what it will spend on running its operations—N15.4 trillion for recurrent expenditure. Think about that. A government that spends nearly as much on servicing debt as it does on its day-to-day running is operating within very tight limits. The implication is straightforward: even if capital expenditure looks big on paper, the actual cash available for development may be swallowed by mandatory debt obligations. This is how ambitious budgets quietly become underfunded promises. It is not a crisis yet, but it is a clear warning sign that should not be ignored.

The 2026 budget also raises a question of credibility. It was initially proposed at a much lower figure before being increased to N68.32 trillion by the National Assembly. Adjustments by the legislature are normal in a democracy. But such a large upward revision requires clear, detailed explanation. Without transparency on what was added, why it was added, and how it will be paid for, the budget’s credibility suffers. It creates the impression of a moving target rather than a carefully thought-out plan. That impression matters because budgets are not just internal documents; they are public statements of intent. When the numbers shift dramatically without explanation, trust in the entire process begins to erode.

Timing makes matters worse. The 2026 budget comes into force in April. But the 2025 capital budget remains active until June. That compresses the time available to implement the new budget. The first quarter of the fiscal year is lost to approvals, adjustments, and delays. By the time full implementation begins, the year is already advanced. The likelihood of underperformance rises, and with it, the likelihood of yet another extension. This is not speculation; it is what has happened repeatedly in recent years. And each extension normalises the very dysfunction that should be corrected.

The broader issue here is not accidental. It is institutional. Nigeria’s budgeting challenges are not rooted in a lack of ambition or even a lack of resources. They are rooted in weak alignment between planning, approval, and execution. Projects enter the budget without being ready. Procurement processes delay action. Cash releases are irregular. Monitoring is inconsistent. The result is predictable: projects spill into the next year, budgets are extended, and the cycle repeats. In well-run systems around the world, budgets are annual, clean, and credible. Projects are admitted only after rigorous checks. Fiscal years are closed cleanly, with very limited carryovers. Transparency is high. Nigeria’s current approach falls short on every single one of these counts.

That said, it would be unfair to dismiss the 2026 budget entirely. There is genuine intent to prioritise development, security, and economic stability. The scale of capital allocation shows an understanding that infrastructure and human capital investment are essential for growth. The trouble is that these good intentions are being pursued within a weak framework that dilutes their effectiveness. The persistence of overlapping budgets is especially troubling because it was previously identified as a problem needing correction. Efforts were made to restore a clean fiscal calendar. That the practice continues suggests either that we lack the institutional capacity to enforce the reform, or that the political incentives to keep flexibility outweigh the benefits of discipline. Either way, the credibility of fiscal policy suffers.

The implications go beyond government spreadsheets. Investors look at the budget as a signal of direction and stability. When budgets overlap and timelines shift, that signal becomes uncertain. Development partners struggle to align their support. Even state governments, which depend on federal allocations and policy cues, are affected by the lack of clarity. For ordinary Nigerians, the issue is more direct. Budgets are judged by outcomes: roads completed, power supplied, jobs created. When projects are delayed or abandoned, when costs zrise, and services fail to improve, public trust erodes. The gap between what is budgeted and what is delivered becomes a harsh daily reality. That is not an abstract concern; it is a lived experience for millions of citizens.

The solution is not complicated in theory, though it requires discipline in practice. Nigeria must return to a single, clean annual budget cycle. Extensions must be rare, tightly controlled, and openly justified. Capital projects must be prioritised based on readiness and national importance, not political favour. Real-time reporting on budget implementation should be standard, not exceptional. Above all, the culture of budgeting must shift from expansion to execution. Bigger budgets do not automatically produce better outcomes. What matters is the ability to turn allocations into results within a fixed timeframe. Until that shift happens, each new budget will simply inherit the unfinished business of the last.

Yet, even as we grapple with these structural weaknesses, the government continues to reach for fresh borrowing. In the same week the 2026 budget was signed, news emerged of a fresh requisition for a loan before the National Assembly for the Sokoto-Benin Highway project, reportedly being constructed by Hitech Construction Company Limited. The reported amount for this leg is approximately $516 million. On the surface, infrastructure linking the North West to the South West is necessary. However, the context is deeply troubling. Former Vice President Atiku Abubakar has rightly warned against this pattern of borrowing without transparent terms and competitive bidding, describing it as a dangerous continuation of the approach observed in the Lagos-Calabar Coastal Highway.

The question is straightforward: If the government cannot efficiently execute the N32.2 trillion already allocated in the 2026 capital budget, why is it rushing to borrow another $516 million for a new mega-project? This suggests a preference for commissioning new initiatives rather than completing existing ones. It suggests that borrowing has become a first resort, not a last resort. With Nigeria’s total public debt stock standing at approximately N159.28 trillion as of December 2025, the weight of this obligation is already crowding out spending on health and education. Adding another $516 million loan without a clear path to repayment—or a transparent, competitive procurement process—is not merely risky; it is fiscally imprudent. A nation that borrows to fund overlapping, unfinished, and poorly tracked projects is not investing in its future; it is mortgaging it.

The 2026 Appropriation Act is therefore best understood as a test. Not of ambition, but of discipline. Not of size, but of structure. If the government can break the cycle of overlap, enforce timely implementation, and deliver measurable results, then this budget will justify its scale. If not, it will join a familiar pattern: impressive at announcement, limited in impact, and eventually extended into the next fiscal year. But the government must also halt the habit of borrowing for new roads while old ones remain incomplete. Nigeria does not lack plans. It lacks closure. And until budgets are treated as binding annual commitments—and loans as instruments of last resort, not political conveniences—that gap between the ledger and the road will remain. Paper can be stretched. But tarmac, once laid, endures.