Senate approves MTEF/FSP for 2025 budget, fixes oil benchmark at $75 per barrel

The senate has approved the medium-term expenditure framework and fiscal strategy paper (MTEF/FSP) ahead of the consideration of the 2025 budget proposal.

MTEF/FSP are parameters any budget of the country is premised on and also serve as a projection of a three-year spending plan of the federal government.

The upper legislative chamber approved the documents on Tuesday, after Sani Musa, chairman of the finance committee, presented a report on the MTEF/FSP.

Also, the senate approved the expenditure framework with a total spending of N47.9 trillion for 2025 and a new borrowing plan of N9.22 trillion which constitutes both domestic and foreign borrowings.

The lawmakers also approved the framework with an exchange rate of N1,400 per dollar and adopted the oil price benchmark of $75, $76.2, and $75.3 per barrel for the years 2025, 2026, and 2027 respectively.

The approved framework also contains a daily oil production output of 2.06 million, 2.10 million, and 2.35 million barrels for the three years.

Also, the senate approved the sum of N15.38 trillion for debt service while pensions, gratuities, and retirees’ benefits would gulp N1.443 trillion, and the fiscal deficit was put at N13.08 trillion.

The gross domestic product (GDP) growth rate projected at 4.6 percent, 4.4 percent, and 5.5 percent for 2025, 2026, and 2027, respectively, were approved.

“Capital expenditure is projected at N16.48 trillion, which is exclusive of transfers; statutory transfers stand at N4.26 trillion; the sinking fund is projected at N430.27 billion, while total recurrent (non-debt) expenditure is projected at N14.21 trillion,” the report reads.

The senate further approved the issuance of promissory note programmes and bond issuance to settle outstanding claims and liabilities of the federal government to state governments.

In addition, the senate approved a quarterly investigative hearing with revenue-generating agencies to track their compliance with the Fiscal Responsibility Act and reprimand clear contravention of the act.

The upper legislative chamber equally approved that the committee on finance and customs initiate an investigative inquiry into the operations of the import duty exemption certificate programme, with a focus on import waivers, and its impact on revenue losses by the federal ministry of finance and Nigerian Customs Service.

In his remarks after the passage of the expenditure framework, Senate President Godswill Akpabio commended members of the joint committee and other lawmakers for their legislative inputs.

On November 19, President Bola Tinubu forwarded the medium-term expenditure framework (MTEF) and the fiscal strategy paper (FSP) to the national assembly for consideration and approval.