Borrowing to finance government policies a necessity – Tinubu Ministers

The Minister of Finance, Wale Edun, and the Minister of Budget and National Planning, Atiku Bagudu, have emphasized the necessity of increased borrowing to finance government policies. Despite a rise in revenue generation, the ministers noted that it remains insufficient for President Bola Tinubu’s administration to fund its projects, including infrastructure development.

The ministers shared these views during an interactive session with the Senate Joint Committees on Finance, National Planning, and Economic Affairs on the 2025-2027 Medium-Term Expenditure Framework and Fiscal Strategy Paper.

Coordinating Minister of the Economy, Wale Edun, acknowledged that while revenue efforts have improved, borrowing remains essential to sustain government initiatives. He stated, “The revenue effort has been good, but we still need to do better, and in the meantime, we still need to borrow productively, effectively, and sustainably. Not just infrastructure but also social services, health services, education, and intervention in terms of social safety nets to help the poorest and most vulnerable.”

Senator Atiku Bagudu explained that the borrowing plans embedded in the ₦35.5 trillion 2024 budget are primarily aimed at addressing the ₦9.7 trillion deficit. He elaborated, “Despite revenue targets surpassed by some of the revenue-generating agencies, the government still needs to borrow for proper funding of the budget, particularly in the area of deficit and productivity for the poorest and most vulnerable.”

Bagudu also pointed to Nigeria’s long-term developmental goals, referencing Agenda 2050, which aims to achieve a GDP per capita of $33,000. According to him, such an ambitious target necessitates strategic borrowing to ensure effective implementation of the government’s policies and programs.

While acknowledging the progress in revenue generation, the ministers’ statements highlight the financial challenges facing the current administration. They also underline the government’s commitment to addressing pressing social and economic issues, such as poverty alleviation, healthcare, education, and infrastructure development.