The Federal Government has significantly increased its planned borrowing for 2026 to N29.20 trillion. This upward revision follows an expansion in the proposed budget size and a widening fiscal deficit.
The new borrowing figure represents an increase of N11.31 trillion compared to the earlier projection of N17.89 trillion. This initial projection was contained in the 2026 Abridged Budget Call Circular issued in December 2025.
The updated estimate is detailed in the 2026 Appropriation Bill, which has been approved by the National Assembly. The specifics were outlined in the House of Representatives’ Order Paper dated March 31, 2026.
Revised Deficit and Expenditure Projections
The revised borrowing plan reflects a sharp increase in the fiscal deficit, which is now estimated at N31.46 trillion. Total government expenditure for 2026 is projected at N68.32 trillion.
Government revenues are expected to reach N36.87 trillion. This gap between spending and revenue has driven a higher reliance on debt financing, with borrowing accounting for the bulk of the deficit funding.
A breakdown of revenue sources shows that N25.92 trillion is expected from federation revenues. An additional N4.31 trillion is anticipated from independent revenues, and N5.85 trillion from government enterprises.
Additional inflows include N1.37 trillion expected from grants and aid. The government also anticipates N300 billion from special funds.
Other financing sources remain relatively small. These include N189.16 billion expected from asset sales and privatisation. Multilateral and bilateral project-tied loans are projected to contribute N2.05 trillion.
The earlier borrowing estimate of N17.89 trillion was based on a lower deficit projection of N20.12 trillion. This indicates a substantial upward revision in both the deficit and the government's financing needs.
Revenue Outlook and Spending Pressures
Government revenue for 2026 is projected at N36.87 trillion. This projection is supported by federation revenues, independent income, and earnings from government-owned enterprises.
Despite the improvement in revenue projections, expenditure growth has outpaced these gains. This trend contributes to the wider deficit and the increased borrowing requirement.
On the spending side, debt servicing remains a significant pressure point for the government's finances.
