The Nigerian House of Representatives, on Wednesday, directed its Committees on Finance and Petroleum (Upstream and Downstream) to investigate claims by the Revenue Mobilisation Allocation and Fiscal Responsibility Commission that the Nigerian National Petroleum Company Limited (NNPCL) withheld ₦8.48 trillion in alleged petrol subsidies. The probe will also address a report by the Nigeria Extractive Industries Transparency Initiative (NEITI) alleging that NNPCL failed to remit $2 billion (₦3.6 trillion) in taxes to the Federal Government.
The committees were further tasked with verifying the cumulative amount of unremitted revenue, known as under-recovery, from petrol sales by the NNPCL between 2020 and 2023.
These investigations coincide with the House’s approval of the 2025-2027 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP). The MTEF outlines a multi-year plan for public spending, while the FSP provides a macro-fiscal framework for budget policies. The approval came ahead of President Bola Tinubu’s expected presentation of the 2025 Appropriation Bill to the National Assembly next week.
Key Projections and Debates
The Tinubu administration’s economic projections include an oil price benchmark of $75 per barrel for 2025, oil production of 2.06 million barrels per day, an exchange rate of ₦1,400 to the dollar, and a Gross Domestic Product (GDP) growth rate of 6.4% annually.
However, the benchmark sparked debate. Minority Leader Kingsley Chinda argued for retaining the 2024 benchmark of $77.96 per barrel, citing higher global oil prices in 2024. “If we recommend $75 for 2025, which is lower than 2024’s benchmark, it might be unrealistic,” he warned.
Chairman of the House Committee on Finance, Abiodun Faleke, defended the projection, stating, “In 2025, crude oil prices may stabilize, and an overestimated benchmark could inflate expectations.” The $75 benchmark was ultimately adopted.
Domestic oil production targets also drew scrutiny. Chinda questioned the rationale for projecting 2.06 million barrels per day (mbpd) in 2025, given the current production of 1.05mbpd. Faleke countered that the target was realistic and designed to motivate increased production.
Fiscal Projections
The House approved the 2025 budget proposal of ₦47.9 trillion, with retained revenue at ₦34.82 trillion and new borrowings of ₦9.22 trillion, split between domestic and foreign sources. Capital expenditure is projected at ₦16.48 trillion, statutory transfers at ₦4.26 trillion, and sinking funds at ₦430.27 billion.
Inflation rates were projected to decrease gradually from 15.75% in 2025 to 10.04% by 2027.
Exchange Rate and Currency Concerns
The proposed exchange rate of ₦1,400 to the dollar also raised concerns. Gbefwi Gaza, a lawmaker from Nasarawa State, emphasized the need for economic strategies to stabilize the naira and reduce borrowing. “What is in place to strengthen the naira and weaken the dollar? Fossil fuels remain our main income source, yet we’re transitioning to renewable energy,” he noted.
The House emphasized the significance of the MTEF/FSP in guiding fiscal policies and urged cautious planning to mitigate economic risks.
Conclusion
The House’s investigations into NNPCL’s alleged financial irregularities, alongside the approval of the MTEF/FSP, underscore its commitment to fiscal transparency and economic planning. These developments will likely shape Nigeria’s fiscal and economic trajectory under the Tinubu administration.