Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has revealed that the Federal government will record about N30trn 2025 revenue shortfall as oil earnings undermine budget projections
The Federal Government has disclosed that it recorded a significant revenue shortfall in the 2025 fiscal year.
The revenue aspirations projected to end the year 2025 is now pegged at ₦10.7 trillion, a shift from the projected ₦40.8 trillion aimed to finance the ₦54.9 trillion 2025 ‘budget of restoration.’
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, made this revelation on Tuesday while appearing before the House of Representatives Committees on Finance and National Planning during an interactive session on the 2026–2028 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP).
According to the minister, the shortfall was largely driven by weak oil and gas revenues, particularly Petroleum Profit Tax (PPT) and Company Income Tax (CIT) from oil and gas companies, alongside underperformance in several revenue subheads.
“The current trajectory indicates that federal revenues for the full year will likely end at around ₦10.7 trillion, compared to the ₦40.8 trillion projection,” Edun told lawmakers.
He added that although the Federal Government had borrowed about ₦14.1 trillion, the combined revenue and borrowing still fell significantly short of what was required to fully fund the 2025 budget.
Despite the challenge, Edun said the government had continued to meet critical obligations through prudent treasury management. He noted that salaries, statutory transfers, as well as domestic and external debt servicing, had been settled as at when due through what he described as “skillful, imaginative and creative handling” of limited resources.
On expenditure performance, the minister said capital releases to Ministries, Departments and Agencies (MDAs) in 2024 amounted to ₦5.2 trillion out of a budgeted ₦7.1 trillion, representing 73 per cent implementation.
He added that total capital expenditure, including multilateral and bilateral-funded projects, stood at ₦11.1 trillion out of ₦13.7 trillion, translating to 84 per cent performance.
Edun cautioned against rigid spending commitments tied to oil revenues, stressing the need for flexibility in expenditure planning given repeated revenue shortfalls in recent years.
“We must be ambitious, but given the experience of the past two years, spending linked to these revenues must depend on the funds actually coming in,” he said.
Also speaking, the Minister of Budget and National Planning, Atiku Bagudu, said the MTEF and FSP were products of extensive consultations involving government agencies, the private sector, civil society organisations and development partners.
Bagudu acknowledged differing views within the Economic Management Team on revenue projections, noting that while some members favoured conservative estimates based on historical performance, others pushed for ambitious targets to drive improved revenue collection.
He explained that although the government retained a headline oil production target of 2.06 million barrels per day for 2026, a more cautious benchmark of 1.84 million barrels per day was adopted for revenue calculations.
Bagudu urged stronger efforts to boost the performance of revenue-generating agencies.
Earlier, Chairman of the Committee, Rep. James Faleke (APC Lagos), said the current state of the economy required careful scrutiny of fiscal proposals, stressing the need to avoid bloated budgets and to take informed decisions that would put the country on a sustainable economic path.
