FG Funds 2024 Capital Projects with 2025 Revenue – DG Budget
The Director-General of the Budget Office of the Federation, Dr. Tanimu Yakubu, said the federal government is funding the capital component of the 2024 budget using revenue accrued under the 2025 budget.
Yakubu stated this in Abuja on Wednesday during a stakeholders’ engagement on the implementation of the 2025 capital budget and related issues.
Of the N34 trillion appropriated in the 2024 budget, N19 trillion was allocated for capital expenditure.
He said, “The federal government has used the revenue accruing from the 2025 budget to fund the capital component of the 2024 budget. Similarly, the 2025 revenue projections in the budget have been underperforming as we have not met our oil production quota.”
He, however, said the federal government has concluded plans to soon commence capital implementation of the 2025 budget.
In June 2025, the National Assembly approved the extension of the capital component of the 2024 national budget, shifting its implementation deadline to December 31, 2025.
The parliament said the extension was necessary for the federal government to complete several ongoing capital projects captured under the 2024 budget.
This marked the second time the 2024 capital component has been extended. In December 2024, the National Assembly granted an initial extension from the original deadline of December 31, 2024, to June 30, 2025, following a request by President Bola Tinubu.
Lawmakers explained that the initial extension was intended to optimise capital expenditure and enable the completion of critical infrastructure projects.
According to reports, 2025 Appropriation Law, totalling N54.99 trillion, has a capital expenditure of N23.96 trillion.
Meanwhile, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has announced that henceforth, Ministries, Departments, and Agencies (MDAs) will not be allowed to award contracts without cash backing.
He said the directive follows the federal government’s implementation of the Cash Management and Bottom-Up Cash Planning Policy, which sets out rules and guidance for planning and managing cash resources to ensure effective and efficient service delivery in executing the 2024 capital budget.
“Henceforth, Warrants/AIEs will be issued to MDAs before any legal commitment is made, serving as evidence of funds available for contract awards or payment for ongoing and completed projects. No letter of award, contract signing, or financial obligation should be undertaken without the corresponding Warrants/AIEs covering the full or committed portion of the contract sum,” Edun said.
He urged MDAs to prudently manage limited resources, optimise revenue collection, and enforce controls to prevent discretionary spending.
He also directed the Accountant General of the Federation (AGF) to develop a new process that will allow MDAs to download and attach Warrants/AIEs as proof of funds during tender board meetings.
According to him, disbursement of funds will remain centralised in the Treasury, with priority given to funding extended 2024 and 2025 capital budgets, particularly priority projects.
Also speaking, AGF Shamseldeen Ogunjimi said the issuance of operational guidelines under the revised Bottom-Up Cash Planning Policy is intended to ensure prudent allocation of limited cash resources.
He noted that the policy’s implementation has been undermined by widespread non-compliance with the Public Procurement Act, 2007, and other regulations, leading to financial commitments far above the government’s projected monthly cash flows.
Ogunjimi warned against the trend of MDAs awarding contracts solely based on budgetary provisions without considering cash flow plans, as well as the practice of prioritising employee payables and mobilisation fees over ongoing and completed projects.
He disclosed that all cash plans submitted between February and March 2025, as part of the extended 2024 budget, have now been warranted, and payments for unutilised warrants already authorised are being finalised.
He said going forward, MDAs will be required to submit implementation plans for the extended 2024 budget within two weeks, aligned with government priorities.
Ogunjimi stressed that no MDA will be permitted to award new contracts or process capital payments on the GIFMIS platform without Warrants/AIEs indicating their spending limits.
Reacting to the development, the Executive Director of the Centre for Fiscal Transparency and Public Integrity (CEFTPI), Umar Yakubu, described the federal government’s action as a clear case of poor budgeting practice.
“Fiscal transparency comes with responsibility and accuracy. However, when a government uses future revenue to fund a past budget, it shows there is no proper planning or transparency,” he said.
Yakubu said borrowing income meant for one year to finance another budget cycle reflects a high level of fiscal irresponsibility and weak budget discipline.
“When you don’t achieve your target, you cannot take revenue from 2025 to fund 2024,” he said.
He warned that if the practice continues, it will undermine accountability, making it difficult for civil society organisations (CSOs) to monitor the implementation of the 2024 budget, and could negatively affect subsequent budgets.