President Bola Tinubu has forwarded the 2026–2028 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) to the National Assembly for approval, a foundational step in the 2026 budget process.
The document was contained in a letter from the president and read by Deputy Speaker Benjamin Kalu during Wednesday’s plenary.
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It was titled “Submission of the Federal Government of Nigeria’s 2026-2028 Medium-Term Expenditure Framework and Fiscal Strategy Paper.”
President Tinubu explained that the MTEF and FSP were approved by the Federal Executive Council on 3 December, and urged lawmakers to expedite legislative action as the 2026 budget will be prepared on their basis.
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After reading the letter, Mr Kalu referred the documents to the House Committee on Finance for detailed scrutiny and possible legislative approval.
What happened at the FEC meeting
At the FEC session presided over by Mr Tinubu, the economic management team led by the Budget Office of the Federation, in collaboration with the Ministry of Budget and Economic Planning, presented the draft MTEF/FSP.
The council approved the framework that will guide Nigeria’s fiscal and budget direction for 2026 through 2028.
Key macro-economic and fiscal assumptions were adopted, including: an oil production target of 2.06 million barrels per day (mbpd) for 2026, with a more conservative 1.8 mbpd benchmark for actual budget planning; a crude oil price benchmark of US$64.85 per barrel; and an exchange rate assumption of N1,512 to the dollar for the 2026 budget.
The federal government projects total revenue of N34.33 trillion in 2026 under this framework.
In approving the MTEF/FSP, FEC also endorsed a Medium-Term Fiscal Expenditure Ceiling, a cap on how much the government can spend, meant to enforce fiscal discipline.
Other decisions at the FEC meeting included the approval of a US$100 million facility from the African Development Bank for the Nigeria Youth Investment Fund, aimed at supporting entrepreneurs aged 18–35 across micro, small and medium enterprises (MSMEs). The council also approved a development loan from the Islamic Development Bank (IsDB) for an integrated agricultural project in Yobe State.
What is the MTEF/FSP and why it matters
The MTEF/FSP is a three-year planning tool that defines in broad strokes how the federal government intends to raise revenue, allocate expenditure, and deploy resources across ministries and sectors over a medium-term horizon. It is required under the Fiscal Responsibility Act, 2007.
The document presents assumptions behind revenue projections (such as oil price, production, exchange rate), outlines strategic expenditure priorities, and forecasts overall fiscal stance, including debt servicing, transfers, recurrent and capital spending.
By approving the MTEF/FSP, the government essentially sets the fiscal envelope within which the annual budgets (starting with 2026) will be prepared. This framework provides a roadmap for fiscal discipline, resource allocation and policy consistency over multiple years rather than leaving budget decisions ad hoc or reactive.
Going forward
With the MTEF/FSP submitted to the National Assembly, attention now shifts to how lawmakers, especially the House Committee on Finance, will scrutinise the document. Their approval is required before the 2026 Appropriation Bill can be prepared and presented.
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Concerns have also been flagged given the late timing (barely weeks before the next fiscal year), with worries that there may be limited time for detailed scrutiny.
Also, while the framework projects revenues and sets expenditure ceilings, much depends on actual performance, oil production, global oil prices, non-oil revenue, debt service obligations and macroeconomic conditions.
With statutory transfers, debt service, personnel and recurrent costs absorbing large portions of projected revenue, the scope for meaningful capital spending or new programmes may be constrained unless revenue generation improves or expenditure is carefully managed.
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