The Minister of Budget and Economic Planning, Abubakar Bagudu, has expressed optimism that the Federal Government will meet its N36.35 trillion revenue projection for 2025.
Speaking during a National Assembly Joint Committee hearing on the 2025 Appropriation Bill, Bagudu attributed his confidence to the economic reforms introduced by President Bola Tinubu’s administration, which he said are already yielding positive results.
He highlighted the impact of removing fuel and foreign exchange subsidies, noting that the resulting revenue boost for all levels of government began to materialize in October 2024. Bagudu emphasized that the savings from these reforms are expected to drive a steady increase in revenue in the coming years.
The minister also revealed that President Tinubu has instructed all revenue-generating Ministries, Departments, and Agencies (MDAs) as well as Government-Owned Enterprises (GOEs) to intensify their efforts to enhance government earnings.
Additionally, the administration plans to increase oil production at reduced costs to further bolster revenue.
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Following the approval of the 2025 Medium-Term Expenditure Framework and Fiscal Strategy Paper, President Tinubu presented an N49.74 trillion Appropriation Bill to the National Assembly in December 2024.
The proposal is based on key assumptions, including a daily oil production of 2.06 million barrels at $75 per barrel, an exchange rate of N1,500/$, a 15.75 per cent inflation rate, and a 4.6 per cent GDP growth rate.
Despite a projected deficit of N13.08 trillion, Bagudu assured lawmakers that the government is confident in its ability to fund the budget. He stated that the administration would draw from its experience with the 2024 budget to meet its revenue goals.
He said, “The 2024 budget is this administration’s first full-year budget, and lessons learned from 2024 have formed the basis of the assumptions in 2025.
“The principal among those assumptions and lessons was the removal of the fuel subsidy and its effect on revenue and expenditure, the removal or deregulation of the foreign exchange market and its impact on both government revenue and spending, and other price-distorting issues, such as electricity, which has not been fully dealt with.
“All the major, bold, and courageous steps taken with the support of the National Assembly are intended to generate more revenues for the three tiers of government, correct distortions in the economy, and improve expenditure efficiency so that we can ensure that the revenue generated goes a long way.”
Bagudu highlighted that 2024 experienced fluctuating revenue profiles, noting that the full impact of fuel subsidy removal only began reflecting in federation account revenues by October.
Despite the lingering effects of the subsidy regime, he assured lawmakers that the administration had gained valuable insights from implementing the 2024 budget.
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These lessons, he stated, have bolstered confidence in achieving the 2025 revenue projections.
Bagudu said, “Because we have seen all the elements and learned many lessons, with the support of the National Assembly, the Budget Office was able to guide and rely on the best estimates, allowing us to make revenue assumptions based on 2.06 million barrels per day.
“The Minister of State Petroleum and the Federal Executive Council even said they hope we can do more. And Mr. President appreciates the security efforts and the fact that we have to challenge the management of institutions to do better, as well as the reduction of importation. These are all things that significantly affect the revenue profile.”
