The Senate has approved President Bola Tinubu’s administration to borrow ₦1.15 trillion from the domestic debt market to bridge the remaining shortfall in the 2025 national budget.
The decision, reached during Wednesday’s plenary session, aims to fill the gap created by the expanded expenditure framework of the current fiscal year.
According to the Senate Committee on Local and Foreign Debt, which presented the report adopted by the upper chamber, the total approved budget for 2025 now stands at ₦59.99 trillion, an increase of ₦5.25 trillion from the original ₦54.74 trillion proposal submitted by the Executive.
This expansion raised the overall deficit to ₦14.10 trillion, out of which ₦12.95 trillion had already been covered by earlier borrowing approvals.
President Tinubu had on November 4 submitted a formal request to the National Assembly seeking approval for the additional ₦1.15 trillion, describing it as essential to sustaining the implementation of capital projects, social intervention programs, and key policy reforms outlined in the 2025 fiscal plan.
“The additional borrowing will ensure the continuity of critical infrastructure projects and prevent any funding gaps that could disrupt the 2025 budget cycle,” Tinubu stated in his letter to lawmakers.
The Senate’s decision comes amid growing debate about Nigeria’s rising debt profile and its potential implications for fiscal sustainability.
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Economists have repeatedly warned that continued reliance on domestic borrowing could crowd out private investment and raise the cost of credit within the economy.
Nevertheless, lawmakers defended the move as a necessary step to maintain budget stability and prevent disruptions in government spending.
Senate Majority Leader Opeyemi Bamidele said the approval was consistent with Nigeria’s fiscal responsibility framework, adding that it would be sourced primarily through treasury bonds and domestic financial instruments.
In a related resolution, the Senate adopted a motion moved by Senator Abdul Ningi, mandating the Committee on Appropriations to strengthen oversight mechanisms to ensure transparency and proper utilization of the borrowed funds.
Ningi emphasized that all expenditures tied to the loan must be tracked and reported to the Senate to guarantee that the funds are used strictly for their intended purposes.
This new domestic borrowing aligns with President Tinubu’s broader strategy to reduce foreign debt exposure while mobilizing local financing sources.
It also reflects the administration’s effort to maintain macroeconomic stability amid revenue shortfalls, inflationary pressures, and ongoing fiscal reforms under the 2025 Appropriation Act.
With the Senate’s approval, the government is expected to proceed immediately with the debt issuance process through the Debt Management Office, ensuring that funds are available to sustain the implementation of national projects and social programmes across various sectors.
