…Oyedele: Expenditures for debt service, security, disaster, multi-year capital projects
…Atiku, Obi Demand Full Accounting of Public Funds
By Emmanuel Olugua
The Federal Government and opposition leaders are locked in an escalating political battle over an alleged ₦8.8 trillion in “unreported” public expenditure after comments by the International Monetary Fund (IMF), first reported by Reuters last week, triggered accusations of fiscal impropriety and a vigorous government defence of President Bola Tinubu’s economic reforms.
The controversy erupted after Reuters, in a July 1 report, quoted IMF Resident Representative in Nigeria, Christian Ebeke, as saying that Nigeria had public spending equivalent to about two per cent of its Gross Domestic Product that was not reflected in recent official budgets, creating a statistical gap between the country’s reported fiscal deficit and its actual financing needs.
Addressing business executives in Lagos, Ebeke explained that the discrepancy stemmed largely from capital projects executed outside the presentation of annual budget documents, making the fiscal deficit appear smaller than the government’s actual borrowing requirements.
“So far we think that there are about 2% of GDP of expenditure that were not reported that should be reported and should be recorded, so that this statistical discrepancy will disappear,” he said.
The IMF official added that Nigerian authorities had already begun addressing the issue by revising budget laws to incorporate previously unrecorded expenditures, while stressing that greater transparency would strengthen fiscal reporting and coordination between monetary and fiscal authorities.
Notably, the IMF’s latest Article IV Consultation commended the Tinubu administration’s sweeping economic reforms, describing them as having strengthened macroeconomic stability and restored investor confidence, although it warned that the benefits had yet to fully reach ordinary Nigerians.
However, the Reuters report quickly ignited a political storm, with opposition figures interpreting the IMF’s observations as evidence that trillions of naira had been spent outside legislative approval.
Former Vice President Atiku Abubakar and Presidential Candidate of the opposition African Democratic Congress, ADC, described the IMF findings as evidence of what he called “the most consequential act of fiscal impunity in Nigeria’s recent democratic history.”
According to Atiku, the reported expenditure—estimated at approximately ₦8.8 trillion based on two per cent of Nigeria’s GDP—represented funds spent “outside the statutory framework of Nigeria’s official budget documents.”
He alleged that the Tinubu administration had created a “parallel fiscal universe” where multi-trillion naira projects were allegedly executed beyond the scrutiny of the National Assembly and the Auditor-General.
The presidential candidate further claimed that the alleged unrecorded expenditure, alongside what he described as unlawful deductions from state allocations, suggested the creation of a political war chest ahead of the 2027 general elections.
Atiku consequently demanded emergency investigative hearings by the National Assembly, a comprehensive audit by the Auditor-General, public disclosure of every project allegedly financed outside the budget, and investigations by anti-corruption agencies.
Also weighing in, Nigerian Democratic Congress, NDC, presidential candidate Peter Obi described the IMF report as raising “serious concerns about the scale of grand corruption” under the Tinubu administration.
Obi argued that the alleged ₦8.83 trillion represented more than one-third of Nigeria’s 2025 capital budget and exceeded the combined allocations to the education and health sectors.
He maintained that if transparently appropriated, the funds could have significantly improved public services, created jobs, and stimulated economic growth.
Describing the administration as “grossly corrupt, incompetent, and insensitive,” Obi urged Nigerians to demand greater accountability in public financial management.
But in a detailed rebuttal issued over the weekend, the Federal Government accused critics of grossly misrepresenting both the IMF’s observations and Nigeria’s constitutional fiscal framework.
In a statement personally signed by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, the government categorically denied operating what critics described as a “shadow budget.”
“The Federal Government has noted recent public commentary alleging that approximately two per cent of GDP, amounting to over ₦8 trillion, was spent outside the approved budget based on references to the IMF Representative in Nigeria and the Fund’s 2026 Article IV Consultation Report.
“These claims are incorrect and risk misleading the public regarding the government’s financial management,” Oyedele stated.
He stressed that under Sections 80 to 83 and 162 of the Constitution, no public funds can be withdrawn or spent except as authorised by the National Assembly through Appropriation Acts, Supplementary Appropriation Acts, or other statutory authorities.
According to the minister, many of the expenditures cited by critics involve legally authorised statutory transfers, first-line charges, debt service obligations, intervention funds, security spending, disaster response programmes and multi-year capital projects that span several budget cycles.
He explained that while such expenditures may be presented differently under international fiscal reporting standards, they are neither secret nor illegal.
“These expenditures are established by law, disclosed in various fiscal reports, and subject to applicable oversight, audit and accountability mechanisms,” Oyedele said.
He further argued that the IMF’s comments related primarily to improving the comprehensiveness, timing and presentation of fiscal reporting rather than questioning the legality of government spending.
The minister also noted that President Tinubu himself had acknowledged the reporting challenges and, during the presentation of the 2026 Appropriation Bill last December, formally requested the National Assembly to end the practice of operating multiple and overlapping budgets by harmonising them into a single fiscal framework.
Oyedele maintained that the administration remains committed to transparency, prudent fiscal management and continued reforms that have already earned commendation from the IMF, international credit rating agencies, investors and other multilateral institutions.
“It is inaccurate to suggest that trillions of naira have been secretly spent outside legislative approval,” he said, insisting that those making such allegations had failed to identify any specific projects executed without lawful appropriation or constitutional authority.
The minister urged Nigerians to distinguish between technical issues involving fiscal reporting standards and allegations of unlawful expenditure, warning that mischaracterising the IMF’s observations risked distorting public understanding of the country’s public finance system.
Financial and public finance experts say the controversy appears to stem from differing interpretations of the IMF’s observations. While opposition figures view the reported discrepancy as evidence of unaccounted public spending requiring investigation, the Federal Government maintains that the issue relates to the presentation and classification of already authorised expenditures under international fiscal reporting standards rather than illegal or unconstitutional spending. They note that the debate has transformed what began as a technical discussion on fiscal reporting into a major political flashpoint over transparency, accountability and the management of Nigeria’s public finances ahead of the 2027 general elections.