•Nigerian Senate
The Senate yesterday approved far-reaching recommendations of its Committee on Finance, endorsing a N54.46 trillion federal spending framework for 2026 and a new borrowing plan of N17.88 trillion which constitutes both domestic and foreign borrowings.
It revised Nigeria’s crude oil benchmark price downward to $60 per barrel, in a move aimed at insulating the economy from global volatility, reports Daily Independent.
The approval followed the consideration and adoption of the report on the Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) for 2026–2028, presented at plenary by the Chairman of the Senate Committee on Finance, Senator Sani Musa, during a session presided over by Senate President Godswill Akpabio.
In a key decision reflecting heightened global uncertainty, the Senate reduced the crude oil benchmark price earlier proposed at $64.85 per barrel for 2026 to $60, while approving $65 and $70 per barrel for 2027 and 2028, respectively. The committee said the downward review was informed by geopolitical tensions in Europe and the Middle East, as well as the sensitivity of global oil prices to external shocks.
Despite the conservative oil price outlook, lawmakers retained domestic crude oil production projections of 1.84 million barrels per day (mbpd) for 2026, 1.88mbpd for 2027 and 1.92mbpd for 2028, expressing confidence in ongoing sectoral reforms and efforts to stabilise production.
On macroeconomic assumptions, the Senate endorsed projected exchange rates of N1,512 to the dollar in 2026, N1,432.15 in 2027 and N1,383.18 in 2028, aligning with the Central Bank of Nigeria’s (CBN) policy direction to stabilise the naira through improved fiscal and monetary coordination.
Inflation is projected to decline steadily over the medium term, with rates of 16.5 percent in 2026, 13 percent in 2027 and nine percent in 2028. The committee attributed the outlook to the commitment of monetary authorities to rein in inflationary pressures.
Similarly, the Senate sustained real GDP growth projections of 4.68 percent for 2026, 5.96 percent for 2027 and 7.9 percent for 2028, citing ongoing economic reforms and anticipated gains from tax reforms expected to take firmer effect from 2026.
A major highlight of the report was the emphasis on the effective implementation of newly enacted tax laws as instruments for economic reform and growth.
In this regard, the committee recommended the adoption of a National Scanning Policy within the National Single Window of the Nigeria Revenue Service, in collaboration with relevant agencies, to enhance revenue assurance, reduce leakages, improve transparency, facilitate trade and strengthen national security.
On fiscal operations, the Senate approved total federal expenditure of N54.46 trillion for 2026. Of this amount, the Federal Government retained revenue is estimated at N34.33 trillion, while new borrowings — both domestic and foreign — are projected at N17.88 trillion. Debt service obligations are estimated at N15.52 trillion.
The framework also provides N1.376 trillion for pensions, gratuities and retirees’ benefits, while the fiscal deficit is pegged at N20.13 trillion.
Capital expenditure, exclusive of transfers, was sustained at N20.131 trillion, alongside statutory transfers of N3.152 trillion and a Sinking Fund provision of N388.54 billion. Total recurrent (non-debt) expenditure was approved at N15.265 trillion, with special intervention funds for recurrent and capital spending set at N200 billion and N14 billion, respectively.
Several senators commended the committee for adopting what they described as realistic and achievable budget assumptions.
Senator Mohammed Tahir Mongono said the revised parameters reflected current economic realities, urging the Senate to fast-track approval of the MTEF and budget.
“We must fast-track approval of the MTEF and budget, as these are the foundation of the country’s economic aspirations,” Mongono said.
Senator Adetokunbo Abiru (Lagos East) praised the cautious approach to revenue projections, particularly the emphasis on non-oil revenue, noting that oil revenue performance had fallen short in recent years. He described the moderation of projected revenue for 2026 as prudent.
Senators Aminu Abas and Adams Oshiomhole also supported the revised exchange rate and oil production assumptions, describing them as more reflective of market realities and Nigeria’s historical production capacity.
In his remarks, Senate President Godswill Akpabio thanked senators and committees involved in reviewing the MTEF and FSP, noting that while projections may be subject to future revisions, the approved framework provides a solid foundation for economic planning.
“We are hopeful that the approved recommendations will drive sustainable economic growth, fiscal discipline and transparency in the coming years,” Akpabio said.
The Senate is expected to proceed with further deliberations on the 2026 budget, with a view to finalising and passing it in the coming weeks to guide Nigeria’s economic strategy from 2026 to 2028.
