The Federal Government of Nigeria has allocated a substantial portion of its 2025 budget to personnel costs, pensions, and debt servicing, amounting to N24.8 trillion. This figure represents 53.98% of the proposed N46.02 trillion budget, according to an analysis of the 2025 Appropriation Bill.
Personnel and pension costs are set to increase by 59.16% from N5.35 trillion in 2024 to N8.52 trillion in 2025, including allocations for government enterprises. Salaries alone account for N7.54 trillion, a rise of N2.75 trillion from the previous year.
Budget Priorities and Spending Breakdown
President Bola Tinubu, presenting the budget titled “Budget of Restoration: Securing Peace, Rebuilding Prosperity”, emphasized its focus on defense, infrastructure, and human capital development. The proposed spending plan includes:
- N16.33 trillion for debt servicing.
- N4.44 trillion for statutory transfers.
- N3.18 trillion for capital supplementation.
- N2.58 trillion for service-wide votes.
The budget also allocates N15.09 billion for expenses related to the State House, including vehicle purchases and maintenance, as well as the construction of an office complex for senior advisers.
Health and Education Allocations
The Federal Ministry of Health and Social Welfare has earmarked N21.04 billion for professional councils, including:
- N18.11 billion for the Medical and Dental Council of Nigeria (MDCN).
- N1.92 billion for the Pharmacy Council of Nigeria (PCN).
- N1.01 billion for the Nursing and Midwifery Council of Nigeria (NMCN).
Despite these allocations, the government had previously announced plans to phase out budgetary provisions for professional bodies, mandating self-funding by 2026.
In education, the Federal Ministry of Agriculture and Food Security proposes spending N54.38 billion on Federal Universities of Agriculture, representing 8.4% of its N636 billion allocation.
Debt vs. Salaries: A Growing Concern
The government will spend more on debt servicing (N16.33 trillion) than on salaries and pensions (N8.52 trillion). This trend underscores the financial strain of managing Nigeria’s growing debt obligations amidst ambitious spending plans.
Policy Implications
With a projected deficit of N13.39 trillion, the 2025 budget is expected to rely heavily on borrowing to bridge funding gaps. Analysts warn that the focus on debt servicing could limit resources for developmental projects, despite the budget’s emphasis on infrastructure and security.
As Nigeria navigates these fiscal challenges, strategic financial management and revenue diversification will be critical to achieving the goals outlined in the Budget of Restoration.
