Atiku Abubakar, 2023 presidential candidate of the Peoples Democratic Party (PDP), has criticized the 2025 budget proposal, describing it as lacking in structural reforms and fiscal discipline. The former Vice President expressed doubts about the budget’s ability to drive sustainable growth or tackle Nigeria’s persistent economic challenges, as envisaged by President Bola Tinubu.
Here are five areas of the budget criticised by Atiku contained in in a statement he released on Sunday.
1. Criticism of Deficit and Borrowing
Atiku highlighted that the budget continues a trend of deficits and heavy reliance on borrowing under the APC-led government since 2016. Note that the government plans to borrow over N13 trillion, N9 trillion in direct loans and N4 trillion for project-specific financing.
Atiku warned that this approach escalates public debt and increases risks from interest payments and forex volatility. He said: “The administration must reduce inefficiencies, tackle inflated contracts, and focus on long-term fiscal sustainability instead of perpetuating unsustainable borrowing and recurrent spending.”
2. Debt Servicing vs. Other Allocations
Atiku criticised what he felt is a disproportionate focus on debt servicing (33% of the budget), which nearly matches capital expenditure (34%). According to him as reflected in the appropriation bill, debt servicing surpasses allocations to key sectors like: Defence (N4.91 trillion), Infrastructure (N4.06 trillion), Education (N3.52 trillion), and Health (N2.48 trillion).
He said: “Debt servicing surpasses allocations for defence (N4.91 trillion), infrastructure (N4.06 trillion), education (N3.52 trillion), and health (N2.48 trillion), crowding out essential investments and worsening the debt cycle.”
3. Critique of Execution and Efficiency
The former Vice President pointed out the poor execution of the 2024 budget, where less than 35% of capital expenditure had been disbursed by Q3, despite claims of 85% execution. He criticised recurrent spending at N14 trillion, saying it fuels inefficiencies and sustains an oversized bureaucracy. He believes that Capital investment, at N80,000 ($45) per capita, is too low to meet infrastructure needs or drive growth.
His words: “The lack of effort to curb waste leaves limited resources for development. Capital investment, accounting for just 25% to 34% of the budget, falls short of addressing Nigeria’s infrastructure needs. At approximately N80,000 ($45) per capita, it cannot drive growth.”
4. Opposition to VAT Increase
Atiku opposed the planned increase in VAT from 7.5% to 10%, calling it a regressive policy. He argued that raising taxes without addressing governance inefficiencies will: Stifle consumption, Deepen economic hardship and Widen economic disparity.
The former Presidential Candidate said: “Raising taxes while ignoring governance inefficiencies will stifle consumption and deepen the cost of living crisis. The government risks widening economic disparity instead of alleviating it,” Atiku concluded.
5. Destined to Fail
Atiku warned that the budget is “destined to fail” due to weak foundations, unsustainable borrowing, and poor prioritization of resources. He called for fiscal discipline, curbing inefficiencies, and a focus on long-term fiscal sustainability instead of perpetuating unsustainable practices.
