The Federal Government has refuted allegations that it expended more than ₦8 trillion outside the 2026 Appropriation Act, insisting that the claims stem from a misinterpretation of the International Monetary Fund’s (IMF) 2026 Article IV Consultation Report and do not reflect the country’s actual public finance practices.
The clarification was contained in a statement issued on Sunday by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, following widespread reactions to comments attributed to the IMF regarding Nigeria’s fiscal reporting.
The controversy arose after the IMF stated that government expenditure equivalent to about two per cent of Nigeria’s Gross Domestic Product had not been reflected in recent official budgets, creating what it described as a statistical discrepancy that understated the country’s financing requirements.
Speaking in Lagos, the IMF Resident Representative in Nigeria, Christian Ebeke, had said: “So far we think that there are about two per cent of GDP of expenditure that were not reported that should be reported and should be recorded, so that this statistical discrepancy will disappear.”
The remarks triggered criticism from opposition leaders, including former Vice President Atiku Abubakar and the presidential candidate of the National Democratic Party, Peter Obi, who accused the Tinubu administration of financial mismanagement and called for an investigation into the matter.
Responding to the allegations, Oyedele maintained that the Federal Government has never operated what he described as a “shadow budget” and that all public expenditure is carried out strictly within Nigeria’s constitutional and legal framework.
“The Federal Government has noted recent public commentary alleging that approximately two per cent of GDP amounting to over ₦8 trillion was spent outside the approved budget based on references to the IMF Representative in Nigeria and the Fund’s 2026 Article IV Consultation Report.
“These claims are incorrect and risk misleading the public regarding the government’s financial management,” the statement said.
The minister explained that Sections 80 to 83 and 162 of the 1999 Constitution clearly regulate the withdrawal and expenditure of public funds, requiring that government spending be backed by constitutional provisions and laws enacted by the National Assembly.
According to him, federal expenditure is implemented through duly approved Appropriation Acts, Supplementary Appropriation Acts and other statutory authorisations approved by the legislature.
He added that projects spanning multiple fiscal years, as well as approved capital rollovers from previous budgets, are recognised features of public financial management and should not be mistaken for unauthorised spending.
“It is inaccurate to suggest that trillions of naira have been secretly spent outside legislative approval. Such allegations should have identified the specific projects purportedly executed without appropriation or legal authority and present credible evidence in support of the claim,” he said.
Oyedele further explained that Nigeria’s fiscal framework accommodates several categories of expenditure established by law, including statutory transfers, debt servicing obligations, first-line charges and intervention funds created through Acts of the National Assembly.
He listed allocations to development commissions, revenue collection costs retained by designated agencies, separately approved capital budgets for certain government institutions and the Federal Capital Territory, security and infrastructure interventions, disaster response programmes and debt servicing commitments as examples of expenditures legally recognised under the country’s public finance system.
“These expenditures are neither secret nor illegal. They are established by law, disclosed in various fiscal reports, and subject to applicable oversight, audit and accountability mechanisms,” he stated.
The finance minister also dismissed suggestions that the reported amount automatically translated into a higher fiscal deficit, explaining that the existence of different lawful financing mechanisms does not alter the basic calculation of the deficit.
“A fiscal deficit is determined by the relationship between total government revenues and total government expenditures. Whether a capital project is financed through annual appropriations, supplementary appropriations, statutory transfers, approved intervention mechanisms, or other lawful financing arrangements does not, by itself, increase the fiscal deficit,” he added.
According to Oyedele, the IMF’s observations were primarily aimed at improving the completeness and presentation of Nigeria’s fiscal reporting rather than alleging unlawful expenditure or financial misconduct by the government.
He noted that President Bola Tinubu had already proposed reforms to address such reporting issues when presenting the 2026 Appropriation Bill to the National Assembly on December 19, 2025, including the adoption of a unified budget framework to eliminate multiple and overlapping budgets.
The minister reaffirmed the administration’s commitment to fiscal discipline, transparency and accountability, adding that recent reforms have strengthened budget credibility, revenue administration, treasury management and the digitalisation of government financial processes.
“The Federal Government will continue to uphold the rule of law, maintain transparency in the management of public resources, and work with the National Assembly, oversight institutions, development partners and the Nigerian people to further strengthen fiscal governance in line with international best practices,” he added.
He also urged Nigerians to approach discussions on public finance with accurate information and a proper understanding of the country’s constitutional and fiscal framework, warning that presenting technical observations as evidence of unlawful spending could misinform the public and undermine constructive policy debate.
