Nigeria’s Budget Overlap Deepens Project Delivery and Accountability Concerns
Nigeria’s continued practice of carrying capital budgets from one fiscal year into another is creating a growing challenge for project delivery, fiscal planning and public accountability, as government agencies continue implementing an older appropriation alongside a new budget.
The latest development came after the National Assembly approved another extension of the implementation period for the 2025 capital budget, keeping it active until December 31, 2026.
That means the 2025 capital appropriation remains operational even as the Federal Government implements the 2026 budget, creating an overlapping system that analysts say can complicate the tracking of public expenditure and project completion. (The Guardian Nigeria)
One country, two active capital budgets
The latest extension is the fourth time lawmakers have prolonged the implementation deadline for the 2025 capital budget.
The appropriation was initially expected to expire at the end of 2025. Subsequent extensions moved the deadline first to March 2026, then June and September, before the latest decision kept it open until the end of December.
The extension was defended as necessary to allow ministries, departments and agencies to complete ongoing projects and settle outstanding obligations.
However, the arrangement means government agencies have to manage projects and financial commitments originating from different budget cycles at the same time. (Businessday NG)
The real problem is execution
The budget overlap becomes more significant when viewed alongside Nigeria’s historically weak capital budget execution.
The Guardian reported that the Federal Government recorded capital expenditure of about N3.1 trillion in the first nine months of 2025, representing roughly 17.7 per cent of the N17.58 trillion projected for the period.
The resulting gap meant that a large portion of planned capital spending remained unexecuted during the period.
The Budget Office attributed the weak performance to factors including limited resources and the government’s bottom-up cash-release process. (The Guardian Nigeria)
This suggests that the challenge is not simply the number of budgets being implemented, but whether government can consistently release funds, complete procurement processes and deliver projects within the period for which they were approved.
More time may save projects — but create new questions
There is a practical argument for extending an existing capital budget.
Where a project has already been awarded, work has started and government funds have been appropriated, allowing the budget to lapse could create additional complications, including unpaid contractor obligations or partially completed infrastructure.
That was one of the arguments advanced by the Presidency and National Assembly in support of the latest extension. (The Guardian Nigeria)
But repeated extensions also raise a different question: when does an extension become a substitute for fixing the budget execution system itself?
If projects routinely move from one fiscal year to another, annual budgets become less useful as clear indicators of what government intends to accomplish within a particular year.
Accountability becomes harder
Overlapping budgets can also make it more difficult for citizens and oversight institutions to determine when a project was actually funded and how much has been spent on it.
A road, hospital, school or other infrastructure project could have its original allocation under one budget, additional funding under another and outstanding payments settled during a subsequent fiscal cycle.
Without clear and timely reporting, this can make it harder to distinguish between new spending and liabilities carried forward from previous years.
The IMF’s 2026 assessment similarly recommended phasing out overlapping budgets and improving reconciliation of budget execution data between key government institutions. It also called for stronger fiscal transparency and regular reporting. (IMF eLibrary)
Tinubu’s single-budget promise faces a test
The latest extension also puts renewed attention on President Bola Tinubu’s earlier commitment to end the overlapping-budget system.
While presenting the 2026 budget in December 2025, Tinubu said Nigeria would move towards a single budget and revenue cycle and promised an end to overlaps and rollovers.
The continued implementation of the 2025 capital budget into the final months of 2026, however, means that the transition has not occurred as originally envisaged. (The Guardian Nigeria)
The development therefore creates a test for the administration’s broader fiscal reform agenda: whether it can move from extending old appropriations to consistently completing projects within their approved budget cycles.
Contractors and investors face uncertainty
The effects also extend beyond government accounting.
Contractors working on projects that spill across fiscal years may face uncertainty over payment schedules, while businesses planning around government infrastructure programmes may find it harder to determine when projects will actually be completed.
This can increase project costs when construction timelines are repeatedly extended.
For investors, predictable government spending is particularly important because infrastructure projects often provide the foundation for private-sector investment in transport, power, housing, manufacturing and other areas.
A budget system that repeatedly shifts implementation timelines can therefore have consequences beyond the public sector.
What needs to change?
The immediate extension of the 2025 capital budget may help government complete some projects that would otherwise remain unfinished.
But the longer-term solution lies in improving the entire budget cycle.
That includes timely budget preparation and approval, realistic revenue and expenditure projections, faster procurement, predictable cash releases and regular publication of detailed implementation reports.
Better reconciliation between budget, debt and government accounting records would also make it easier to track how much has been appropriated, released and actually spent.
The IMF has specifically highlighted the need to reconcile budget execution data across the Budget Office, the Debt Management Office and the Office of the Accountant-General of the Federation, alongside stronger fiscal reporting. (IMF eLibrary)
The bigger question for Nigeria’s fiscal reforms
Nigeria’s budget challenge is ultimately less about producing larger appropriation figures and more about converting approved spending into completed projects.
The extension of the 2025 capital budget may provide additional breathing room for unfinished projects, but repeated rollovers risk normalising a system in which fiscal years lose their meaning.
For the government, the challenge now is to ensure that the flexibility used to complete existing projects does not become a permanent substitute for stronger budget execution.
A more predictable system would give government agencies clearer spending targets, contractors greater certainty and citizens a better way to track what public funds are delivering.
Until that happens, Nigeria’s overlapping budgets will remain not only a fiscal-management issue but also a test of the government’s ability to turn budget promises into measurable development.
