FG orders MDAs to roll over 70% of 2025 capital budget into 2026

The Federal Government has directed ministries, departments and agencies to carry over 70 per cent of their 2025 capital allocations into the 2026 fiscal year, as the administration prioritises completing ongoing projects amid weak revenues and rising fiscal pressures.

The directive is contained in the 2026 Abridged Budget Call Circular issued by the Ministry of Budget and Economic Planning and circulated to ministers, service chiefs and heads of agencies. The document laid out strict guidelines for preparing next year’s spending plan, including a ban on introducing new capital projects.

According to the circular, MDAs must “upload 70 per cent of their 2025 FGN Budget to continue in FY2026” and ensure that all rollover items align with the administration’s priorities—national security, economic growth, education, health, agriculture, infrastructure, power, energy, and social safety nets.

‘We are constrained by revenue challenges’

The circular said the government had adopted a new framework that caps all 2026 capital budget ceilings at 70 per cent of 2025 project allocations. Only 30 per cent of this year’s capital budget will be released in 2025, while the remaining 70 per cent forms the foundation of next year’s capital spending.

The ministry said the policy is meant to prevent duplication, strengthen continuity and ensure that uncompleted projects are not abandoned. It warned MDAs against attempting to exceed their 2025 overhead ceilings in their 2026 submissions, despite inflationary pressures.

“We are constrained by revenue challenges,” the circular said. “While we note the impact of inflation, proposals that exceed approved ceilings will be adjusted downward.”

2026 budget to align with MTEF, Renewed Hope Agenda

The circular said the 2026 budget must reflect the strategies in the Medium-Term Expenditure Framework (2026–2028), the Renewed Hope Infrastructure Development Plan, the Ward Development Plan and the National Development Plan, as well as the Accelerated Stabilisation and Actualisation Plan.

MDAs must submit their budgets through the GIFMIS Budget Preparation Subsystem, while government-owned enterprises will submit via the Budget Information Management and Monitoring System. All submissions must be completed by Tuesday, December 9, 2025.

Personnel costs have already been computed using data from IPPIS and earlier submissions, the circular noted. Each ministry will be informed of its personnel cost ceiling for 2026.

Fiscal framework shows tighter revenues, rising debt service

The financial projections accompanying the circular show a more constrained revenue outlook for 2026. Total funds available to the Federal Government, including GOEs, are projected at N54.46tn, down slightly from N54.99tn in 2025.

Statutory transfers are projected to drop from N3.64tn in 2025 to N3.15tn in 2026, while recurrent non-debt expenditure is estimated at N15.26tn.

Debt service obligations are set to rise sharply—from N13.94tn this year to N15.52tn in 2026.

Aggregate capital expenditure is projected at N22.37tn, down from N26.19tn in 2025. Capital allocations for MDAs fall from N12.39tn to N8.67tn, while project-tied loans will shrink from N3.36tn to N2.05tn.

The deficit widens significantly to N20.12tn in 2026, from N14.10tn in the current year.