FG Faces N30trn Revenue Shortfall as Lawmakers Question Budget Credibility
Atume Terfa
Nigeria’s fiscal outlook has come under intense scrutiny following the revelation of a ₦30 trillion revenue shortfall in the 2025 financial year, raising fresh concerns over budget realism, revenue mobilisation and the government’s broader economic strategy.
The scale of the gap was laid bare during a briefing at the National Assembly, where the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, disclosed that actual government earnings have fallen far short of projections. While the federal government had planned to generate about ₦40.8 trillion to fund the ₦54.9 trillion 2025 Budget of Restoration, revenue inflows are now expected to end the year at just ₦10.7 trillion, leaving a substantial funding deficit.
Much of the shortfall has been traced to underperformance in key revenue streams, particularly the oil and gas sector, which remains central to Nigeria’s public finances. Proceeds from Petroleum Profit Tax and Company Income Tax paid by oil firms came in well below expectations, while non-oil revenues also failed to meet targets, compounding fiscal pressures.
In an effort to keep government operations running, the administration turned to borrowing, raising about ₦14.1 trillion during the year. Even so, the additional debt proved insufficient to fully plug the revenue hole, exposing the fragility of Nigeria’s income structure and its vulnerability to fluctuating oil prices and production challenges.
The disclosure sparked concern among lawmakers and economic analysts, with members of the House of Representatives Committee on Finance calling for tighter oversight and more credible revenue assumptions. They warned that repeatedly setting ambitious targets detached from economic realities undermines budget credibility and weakens fiscal planning.
The impact of the revenue gap is already being felt. Several capital projects initially scheduled for completion in 2025 are now being pushed into 2026, a development critics say highlights persistent weaknesses in budget design and execution.
Economists point to deeper structural problems driving the shortfall, including poor tax compliance, inefficiencies within revenue-generating agencies and heavy dependence on volatile oil receipts. Many argue that meaningful reforms — such as expanding the tax base, deploying digital tools for revenue collection and strengthening fiscal institutions — are essential to prevent future gaps of this magnitude.
Despite the challenges, Edun assured lawmakers that the government has continued to meet critical obligations, including salary payments, statutory transfers and debt servicing, through tight cash management and prioritisation of essential spending.
As Nigeria grapples with slowing growth and tightening public finances — challenges mirrored across much of Africa — the ₦30 trillion revenue gap has intensified pressure on policymakers to restore confidence in fiscal management and deliver more realistic, sustainable economic planning.
