2025 Budget: Reps Panel Reject Envelop System Of Budget

…as it decry poor funding for Nigerian missions abroad

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By Gloria Ikibah

The House of Representatives Committee on Foreign Affairs has criticized the Federal Government envelope system of budgeting, and stated that it lacks legal backing under Nigerian law.

The Committee also expressed dissatisfaction with the allocation of only ₦286 million to sustain Nigeria’s 109 foreign missions, describing the amount as grossly inadequate.

According to documents submitted by the Federal Ministry of Foreign Affairs, the Ministry had proposed a budget of about ₦1.5 trillion based on the needs of these missions.

During an interactive session with the Ministry and Budget Office of the Federation on Tuesday, the Committee Chairman, Rep. Wole Oke, expressed frustration and said, “I have not seen anywhere in our laws where envelop budgeting is mentioned.”

He described the proposed funding as insufficient for missions tasked with projecting the country’s image internationally.

“We’re concerned that what was submitted to Mr. President does not align with the actual needs assessment and is inconsistent with the law”, he added.

In response, Director General of the Budget Office, Tanimu Yakubu, stated that the allocation for foreign missions has been increased by 25 percent in the 2025 budget. He however, called on the National Assembly to pass the tax reform bills to enhance revenue generation.

Yakubu further suggested a temporary reduction in the number of Nigerian foreign missions, stating, “Why don’t we consider a significant reduction of our foreign missions until we’re able to improve our revenue?”

He noted that his hands were tied on the envelop budgeting system.

“We have 109 diplomatic missions abroad, comprising of 76 embassies, 22 High Commissions and 11 Consulates. The problem as you rightly described is as ubiquitous as Nigeria’s present worldwide.

“The situation was certainly worse three years ago when Nigeria’s debt service was proclaim almost 100 percent of the country’s revenue. We start to see improvement under this administration, when through debt financial engineering in year one, debt service was brought from as high as 100 percent to 55 percent

“If you talk to our missions abroad, they will tell that last year was the year they started experiencing some relief. We’re still not there yet. Bold reforms have been embarked on by the current administration, starting with the liberalisation of the foreign exchange rate, and the withdrawal of subsidy on PMS and other products.

“We expect to save about N11 trillion from this two models adopted. The savings started to materialize in October last year, but the main beneficiaries, especially the state governments collected the money and kept mute, but we knew that they took a lot more than they have for several years.

“We have brought before the National Assembly, tax Bills that you’re considering, that we expect you to improve so that we’ll be able to collect more revenue

“Mr President has gone out of his way to inisit on 2.12 million barrels per day, a very ambitious target for oil output… He has seen that we must look for the revenue to be to attend to these needs. That’s why this year’s budget is ambitious. Last year, it was about N36 trillion but this year, it almost N50 trillion.

“We have to continue to manage scarcity, whether we call it envelop budgeting”, he said.