2026 budget: How MDAs insert ₦3.5trn new projects despite FG freeze

An analysis of the proposed 2026 Appropriation Bill has revealed that Ministries, Departments and Agencies (MDAs) inserted at least ₦3.50 trillion worth of new projects into the budget, despite a Federal Government directive barring the introduction of fresh capital projects.

Findings show that new project entries within MDAs alone amount to ₦844.49 billion, while the figure rises sharply to ₦3.50 trillion when Service Wide Votes are included.

Against the proposed ₦23.21 trillion capital budget for 2026, the new projects represent about 15.09 per cent of total capital expenditure.

The Service Wide Votes component accounts for the bulk of the new projects, totalling ₦2.66 trillion and reflecting a concentration of major allocations outside conventional ministerial capital lines.

In December 2025, the Federal Government had directed MDAs to roll over 70 per cent of their 2025 capital allocations into the 2026 fiscal year, as part of efforts to prioritise the completion of ongoing projects and manage spending pressures amid weak revenue performance.

The directive, contained in the 2026 Abridged Budget Call Circular issued by the Federal Ministry of Budget and Economic Planning, instructed MDAs to avoid proposing new projects and instead continue with those already approved in the 2025 budget.

It also stressed that all spending would be subjected to strict scrutiny to ensure value for money.

However, an examination of the 2026 Appropriation Bill shows that at least 82 MDAs included one or more new capital or programme items, with over 400 fresh project lines spanning multibillion-naira infrastructure and health projects, as well as smaller constituency-level interventions such as boreholes, training programmes and equipment supply.

A review of Service Wide Votes reveals 18 new project entries tied largely to financing programmes, security-related spending, liabilities and central government initiatives.

The largest single item is ₦1.70 trillion earmarked for outstanding contractors’ liabilities from 2024, which alone accounts for about 48.55 per cent of the total new project portfolio.

Other major Service Wide Vote provisions include three ₦100 billion allocations for the Nigeria Development Finance Corporation, the Economic Transformation Finance Programme and the Nigeria Growth Investment Fund.

According to PUNCH Online, additional entries include ₦20 billion for the capitalisation of INFRACO, ₦30 billion for a DSS special operations fund, and ₦110.31 billion for the Nigerian Air Force to settle outstanding obligations on T-129 ATAK and Mi-35 helicopters.

The budget also provides ₦283.85 billion for presidential air fleet logistics and management, including the operation of the National Forest Guard. There are also take-off grants of ₦41.12 billion (recurrent) and ₦19.50 billion (capital) for newly created MDAs, alongside provisions for pension increases and gratuity payments.

At the MDA level, the Budget Office of the Federation recorded the highest value of new projects, with a ₦375 billion provision for additional financing under the Power Sector Recovery Operation. This single item accounts for about 44.41 per cent of total MDA-level new projects and 10.71 per cent of the overall new project allocation.

The Federal Ministry of Transport headquarters follows with ₦210.53 billion in new projects, including consultancy services for major rail projects and the construction of bus terminals and transport facilities across the six geopolitical zones.

Other notable new project allocations include ₦24 billion for the renovation and upgrade of the National Library of Nigeria nationwide; ₦15 billion for the National Blood Service Commission to build and equip a national blood service centre and rehabilitate state offices; and ₦9.14 billion for various projects under the Sokoto Rima River Basin Development Authority.

Further analysis shows that ₦5.85 billion was earmarked for vehicle purchases across several institutions, while ₦2.93 billion was allocated for furnishing and office equipment.

Renovation and refurbishment projects total ₦29.88 billion, and residential and staff accommodation projects stand at ₦25.29 billion, largely driven by allocations to defence and security agencies.

The findings highlight a recurring pattern, as similar restrictions on the introduction of new projects were issued ahead of the 2025 budget.

In the 2024 Budget Call Circular, the Federal Government warned that no new projects would be admitted unless adequate provision had been made to complete ongoing ones.

Despite these guidelines, analysts say enforcement remains weak. The President of the Nigerian Economic Society, Prof. Adeola Adenikinju, attributed the problem partly to late budget presentations, which limit the National Assembly’s ability to conduct thorough scrutiny.

A development economist and Chief Executive of CSA Advisory, Dr Aliyu Ilias, also criticised what he described as poor fiscal discipline, accusing both the executive and the legislature of tolerating inefficiencies and failing to enforce budget rules.

According to him, the lapses appear deliberate, adding that the National Assembly has not adequately discharged its oversight responsibility to ensure compliance with budgetary guidelines.