Senate Approves N1.15trn Loan to Fund 2025 Budget Deficit
The Senate on Wednesday approved President Bola Ahmed Tinubu’s request to establish a ₦1.150 trillion domestic borrowing programme aimed at closing the funding gap in the 2025 budget deficit.
The decision followed the consideration and adoption of a report presented by the Senate Committee on Local and Foreign Debt, chaired by Senator Aliyu Magatakarda Wamakko.
President Tinubu’s request, detailed in a communication dated October 31 and read during plenary on November 4, was made in line with the provisions of the Debt Management Office (Establishment) Act, 2003, and the Fiscal Responsibility Act, 2007.
According to the President, the borrowing became necessary following the expansion of the 2025 Appropriation Act, which increased the total budget size to ₦59.99 trillion, about ₦5.25 trillion higher than the initial ₦54.74 trillion proposed by the Executive.
This adjustment created a total deficit of ₦14.10 trillion. Of this amount, ₦12.95 trillion had already been covered through previously approved borrowings, leaving an outstanding shortfall of approximately ₦1.15 trillion.
Tinubu assured that the new borrowing would be carried out strictly within the framework of existing fiscal laws and guidelines, emphasizing that the funds would be channeled toward capital and human development projects. He further stated that all loans would be secured on concessional terms with low interest rates and long repayment periods to ensure debt sustainability.
The Senate Committee on Local and Foreign Debt confirmed that the request complied with all statutory borrowing procedures. After reviewing the 2025 Appropriation Act and relevant supporting documents, the committee verified that the proposed borrowing was duly authorized within the national budget framework.
The committee’s report noted that the upward revision of the 2025 budget had created an additional funding gap of ₦1,147,462,863,321, necessitating the establishment of the ₦1.150 trillion domestic borrowing programme.
Presenting the report, Senator Wamakko said the committee, after comprehensive deliberation, recommended Senate approval of the borrowing request to ensure full implementation of the 2025 fiscal plan.
The Senate subsequently adopted the committee’s key recommendations, which included:
Approval of the President’s request to raise ₦1.150 trillion through the domestic debt market to fund the unfunded portion of the 2025 budget deficit.
Directive to the Federal Ministry of Finance and the Debt Management Office (DMO) to ensure that all borrowing terms are favorable, transparent, and sustainable.
Mandate to the Senate Committee on Local and Foreign Debt to monitor implementation and utilization of the funds, with quarterly reports to be submitted by the Ministry of Finance and the DMO.
Additional motion by Senator Abdul Ningi calling for strict oversight by the Appropriation Committee to ensure the borrowed funds are used solely for their approved purposes.
Presiding over the session, Deputy Senate President Barau Jibrin commended Senator Wamakko and the committee for their “thorough and timely” review. “You have done a wonderful job. The report is precise, very clear, and you concluded your assignment within the shortest possible time,” he said.
With the Senate’s approval, the Federal Government can now proceed to raise ₦1.150 trillion from the domestic debt market to finance the 2025 fiscal deficit. The move is expected to support ongoing economic recovery efforts and ensure the smooth implementation of the administration’s budgetary and development objectives.
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