2025 Budget: N1trn for solid minerals, N1.5trn for BOA

On Wednesday, President Bola Tinubu wrote to the National Assembly seeking an increment to the 2025 budget proposal.

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In the letter read on the floor of both chambers, the president sought to increase the budget from N49.7 trillion to N54.3 trillion.

Mr Tinubu stated that the federal government expects N1.8 trillion from Government-Owned Enterprises (GOEs), N1.49 trillion from the Federal Inland Revenue Service (FIRS), and N1.2 trillion from the Nigeria Customs Service (NCS).

However, the most significant aspect of the proposal is the expenditure profile of the budget. In the letter, the president listed about seven major sectors.

The president is proposing N1 trillion for the solid minerals sector, signalling a commitment to diversifying the economy away from oil. Over the years, successive governments have pledged to invest in the solid minerals sector, but these commitments have not been backed by financial allocations.

The Minister of Solid Minerals, Dele Alake, has, over the past 18 months, lamented the poor funding of his ministry. During the budget defence session in January, he stated that the N9 billion allocated to his ministry was inadequate.

“I met the president on the need for an upward review of the N9 billion budgetary proposal for my ministry. I met the Minister of Finance, his counterpart in the Ministry of Budget and Economic Planning, and also the Director-General of the Budget Office.

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“They all gave assurances that the N9 billion proposal would be reviewed upwards. But I am surprised that, to date, nothing of the sort has been done,” he told the joint committee on solid minerals.

The lawmakers subsequently summoned the Minister of Finance, Wale Edun and the Minister of Budget and National Planning, Atiku Bagudu to explain the low allocation.

Earlier in 2024, Mr Alake also raised the alarm over the poor funding of the sector, stating that investment in the mining sector was significantly lower in Nigeria compared to some African countries.

“According to Standard & Poor’s, as of 2023, Nigeria’s investment in exploration was $2.5 million, compared to $147 million in Ivory Coast and $133 million in Congo.

“In our determination to compete, we had proposed a budget of N70 billion to invest in exploration that would cover the entire Nigerian landscape,” he said during a hearing in the House of Representatives.

While the details of the expenditure remain unavailable, experts in the sector have described the proposed funding as a welcome development.

Felicia Dairo, Project Manager at the Centre for Journalism Innovation and Development, commended the move and also called for accountability mechanisms to prevent wastage.

“With the president’s new directive to spend N1 trillion in the sector, it is a welcome development and a conversation that is long overdue. What is required now is an accountability mechanism to monitor the spending, and that is where the role of civil society actors and accountability watchdogs comes in,” she stated.

N1.5 Trillion for Recapitalisation of BOA, N500 Billion for BOI

President Tinubu also proposed N1.5 trillion for the recapitalisation of the Bank of Agriculture (BOA) to support agricultural activities.

“To transform Nigeria’s agricultural landscape, ensure food security, and empower smallholder farmers and agribusinesses,” Mr Tinubu stated in the letter.

He added that the budget proposal would empower smallholder farmers, enhance agricultural productivity, and stimulate exports.

This proposal comes amid acute food insecurity in the country, with food inflation hovering around 40 per cent.

N1.5 Trillion for Renewed Hope Infrastructure Development Fund (RHIDF)

The president also proposed N1.5 trillion for the Renewed Hope Infrastructure Development Fund (RHIDF), a special infrastructure fund set up by the president.

Under the RHIDF, the government is proposing N380 billion for irrigation development (through River Basin Development Authorities), N700 billion for transportation infrastructure, with N300 billion for the construction and rehabilitation of critical roads, and N400 billion for light rail network development in urban centres.

Other expenditures under the RHIDF include N50 billion for border communities’ infrastructure, N250 billion for military barracks accommodation, and N120 billion for military aviation.

It remains unclear whether the respective agencies will appear before lawmakers to defend these new proposals, as the budget defence activities are almost concluded.

The Senate President, Godswill Akpabio, said on Wednesday that the National Assembly would pass the 2025 budget by the end of February despite the increase proposed by the president.