Atiku chides Tinubu for repeating Buhari’s borrowing mistakes

Atiku Abubakar, the Peoples Democratic Party’s 2023 presidential candidate, has criticised President Bola Tinubu’s 2025 budget proposal, accusing him of repeating his predecessor Muhammadu Buhari’s borrowing mistakes. 

Atiku, who scrutinised the budget, claimed that it lacked the fundamental reforms and budgetary discipline required to confront Nigeria’s complex economic problems.

In a statement released on Sunday, Atiku questioned the budget’s ability to promote long-term economic growth or address the country’s long-standing issues.

On Wednesday, President Bola Tinubu delivered an N47.9 trillion budget proposal to a joint session of the National Assembly.

The proposed budget sets aside N4.91 trillion for military and security, N4.06 trillion for infrastructure, N2.48 trillion for health, and N3.52 trillion for education.

AtikuE criticised the budget proposal, saying it reflected a continuation of “business-as-usual” fiscal practices, which he claimed had persisted under the All Progressives Congress-led administration since 2016.

He contended that these tactics had resulted in chronic budget deficits and an increased reliance on foreign borrowing.

“To bridge this fiscal gap, the administration plans to secure over N13tn in new borrowings, including N9tn in direct loans and N4tn in project-specific financing.

“This borrowing strategy mirrors the approach of previous administrations, leading to escalating public debt and compounding risks related to interest payments and foreign exchange exposure,” Atiku added.

The former Vice President emphasised the budget’s reliance on deficit financing, noting that it estimates N48 trillion in expenditures against a revenue prediction of N35 trillion, resulting in a deficit of more than N13 trillion—equivalent to 4% of the country’s GDP.

Atiku attacked the 2024 budget’s underperformance, which he attributed to weak execution capabilities.

“By the third quarter of 2024, less than 35% of the capital expenditure allocated to ministries, departments, and agencies had been disbursed, despite claims of 85% budget implementation. This raises concerns about the effective execution of the 2025 budget.

“The 2025 budget lacks the structural reforms and fiscal discipline required to address Nigeria’s multifaceted economic challenges.

“To enhance its credibility, the administration must prioritise reducing inefficiencies in government operations, tackling contract inflation, and focusing on long-term fiscal sustainability rather than perpetuating unsustainable borrowing and recurrent spending patterns.”

He also voiced concern about the allocation of N15.8 trillion (33% of total expenditure) to debt servicing, noting that it is roughly equivalent to the anticipated capital investment of N16 trillion (34%).

“This imbalance undermines fiscal stability, crowds out essential investments, and perpetuates a cycle of increasing borrowing.

“The government’s recurrent expenditure, which accounts for over N14tn (30% of the budget), remains disproportionately high, according to Atiku.

“This reflects the continued operation of an oversized bureaucracy and inefficient public enterprises, leaving limited resources for development projects,” Atiku said.

He further mentioned the inadequacy of capital spending, stating, “After accounting for debt servicing and recurrent expenditure, the remaining funds for capital spending—representing 25% to 34% of the total budget—are insufficient to address Nigeria’s infrastructure deficit or stimulate growth.

“This equates to an average capital allocation of N80,000 (approximately $45) per capita, which is inadequate for a country grappling with slow economic growth and infrastructural underdevelopment.”

He condemned the administration’s decision to increase the VAT rate from 7.5% to 10%, calling it a regressive measure that would exacerbate the cost-of-living crisis and impede economic growth.

“By imposing additional tax burdens on an already struggling populace, without addressing inefficiencies in governance, the government risks stifling domestic consumption and deepening economic hardship,” Atiku said.

Atiku advocated for a transition towards disciplined and growth-orientated fiscal policies, highlighting the need to reduce waste, improve the efficiency of public spending, and prioritise investments in important industries.

He finished by pushing the administration to reconsider its borrowing policy and implement changes that would ensure long-term fiscal sustainability and economic growth.