By Uche Usim and Merit Ibe

The controversy surrounding the reported N8.8 trillion in off-budget spending is less about allegations of hidden funds and more about the federal government’s obligation to provide Nigerians with complete and accessible information on how public resources are managed.

This was the position of the Alliance for Economic Research and Ethics (AERE) has described the federal government’s reported N8.8 trillion off-budget spending as a governance crisis rather than a mere accounting issue, warning that continued fiscal opacity could undermine Nigeria’s economic future.

In a policy brief, the group, through its Chairman, Dele Kelvin Oye, said Nigeria had reached a critical point where greater transparency in public finance had become imperative, urging the federal government to move beyond what it described as technical compliance with budget procedures to full fiscal accountability.

The organisation also called on the International Monetary Fund (IMF) to strengthen its oversight by making greater transparency a condition for the technical assistance it provides to Nigeria.

AERE further criticised the proposed $5 billion financing arrangement with the United Arab Emirates (UAE), describing it as a temporary liquidity measure that fails to address the country’s underlying fiscal challenges.

According to the group, the loan reflects a broader pattern of relying on increasingly complex financing mechanisms instead of tackling fundamental issues such as weak revenue generation, high public spending and inadequate fiscal transparency.

It warned that unless the government adopts genuine reforms to improve openness in public finance management, the reported N8.8 trillion off-budget spending would continue to weaken investor confidence, threaten macroeconomic stability and diminish public trust in state institutions.

The group maintained that lasting economic stability would depend on strengthening institutional integrity and ensuring that government finances are managed transparently and accountably.

Also speaking, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Muda Yusuf and other economic experts.

They argued that the absence of adequate disclosure fuels public suspicion and undermines confidence in government finances.

According to Yusuf, the federal government has yet to sufficiently explain the composition and structure of several expenditure items captured outside the conventional budget framework.

“The federal government should provide adequate information. If there is no adequate information, it creates suspicion. The government has not provided enough information so far,” he said.

He explained that beyond the main budget envelope, Nigeria’s fiscal framework contains several other spending components that deserve greater public scrutiny and explanation.

“What we have now is the main envelope that contains capital expenditure and other recurrent spending. Then we have Service-Wide Votes, statutory transfers and capital supplementation. There are many details in the budget that are not known,” he stated.

Yusuf stressed that the issue is fundamentally one of transparency rather than allegations of financial impropriety.

He maintained that Nigerians have a right to understand how statutory transfers and other supplementary expenditure items are appropriated and spent, particularly given the country’s difficult fiscal environment.

“It’s about boosting transparency. It is not good if the government fails to provide these details because these are public funds. There should be better accountability,” he said.

He added that the debate should not be interpreted as suggesting the existence of hidden or illegal funds, but rather as a call for more comprehensive disclosure of budgetary information.

“It’s not about hidden money. It’s about boosting transparency, especially regarding statutory transfers and other budget components,” Yusuf noted.

His comments come amid growing public interest in Nigeria’s fiscal operations, with economists and civil society groups increasingly calling for greater openness in budget implementation and reporting. Analysts say providing clearer details on statutory transfers, Service-Wide Votes and capital supplementation would improve fiscal credibility, strengthen oversight by the National Assembly and reassure citizens that public funds are being managed efficiently.

Meanwhile, the federal government has dismissed claims that it spent more than N8 trillion outside the 2026 approved budget, describing the allegations as false and a misrepresentation of observations contained in the International Monetary Fund’s (IMF) 2026 Article IV Consultation Report.

In a statement issued on Sunday by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, the government said it does not operate a “shadow budget” and that all public spending is carried out within the constitutional and legal framework approved by the National Assembly.

The ministry was reacting to public commentary alleging that about two per cent of Nigeria’s Gross Domestic Product (GDP), estimated at over N8 trillion, was spent outside the budget based on references to the IMF’s report.

According to the statement, under Sections 80 to 83 and 162 of the 1999 Constitution, public funds can only be withdrawn and spent in line with Appropriation Acts, Supplementary Appropriation Acts and other statutory authorities enacted by the National Assembly.

It explained that multi-year capital projects often span several budget cycles and are implemented through approved capital rollovers where necessary, stressing that such projects should not be interpreted as expenditures outside the budget.

“It is inaccurate to suggest that trillions of naira have been secretly spent outside legislative approval,” the ministry said, adding that anyone making such allegations should identify specific projects allegedly executed without appropriation and provide verifiable evidence.

The government also clarified that Nigeria’s public finance framework includes statutory transfers, first-line charges and intervention mechanisms established by law, including allocations to development commissions, debt service obligations, security spending, infrastructure projects, disaster response and other national priorities.

According to the ministry, these expenditures are legal, publicly disclosed in fiscal reports and subject to oversight and audit, although their presentation under international reporting standards may differ from their classification in the annual Appropriation Act.

The statement further rejected suggestions that the reported amount represented an increase in Nigeria’s fiscal deficit, explaining that the deficit is determined by the gap between total government revenue and expenditure, not by the financing mechanism used for approved projects.

The ministry maintained that the IMF’s observations were focused on improving the comprehensiveness, timing and presentation of Nigeria’s fiscal reporting rather than questioning the legality of government expenditure.

It also recalled that President Bola Tinubu had, while presenting the 2026 Appropriation Bill to the National Assembly in December 2025, urged lawmakers to harmonise multiple and overlapping budgets into a single framework to improve fiscal transparency.

The federal government reiterated its commitment to prudent fiscal management, transparency and accountability, noting that ongoing reforms in treasury management, revenue administration and the digitalisation of public finance processes have been recognised by the IMF, other multilateral institutions and international credit rating agencies.

The ministry urged members of the public to base discussions on factual information, warning that misrepresenting technical fiscal issues as evidence of unlawful spending could undermine informed public debate.

Tags: #Alliance for Economic Research and Ethics (AERE) #Chairman #Dele Kelvin Oye #hidden funds

Credit: thesun.ng