Senate on Wednesday at plenary approved President Bola Tinubu’s request for N1.15 trillion loan from the domestic debt market to finance deficit in the 2025 budget.
The approval followed adoption of report of Senate Committee on Local and Foreign Debts.
The report was presented by the Vice Chairman of the Committee, Sen. Manu Haruna (APC -Taraba).
Tinubu had on Tuesday, Nov. 4 in a letter urged the senate to approve the domestic loan request to finance the deficit in the 2025 Appropriation Bill.
Senate upon receipt of the request mandated its committee on local and foreign debts to expeditiously ensure further legislative inputs on the request and report back to plenary.
Presenting the committee ‘s report, Haruna said that a budget of N59.99 trillion was passed in the 2025 Appropriation Act, showing an increase of 5.25 trillion from the 54.74 trillion budget earlier proposed by the executive.
He said that the increase created a budget deficit of N14.10 trillion, saying that the proposed borrowing approval in the budget was N12.95 trillion, which occasioned an unfunded deficit of N1.147 trillion.
He said it was, therefore, necessary to increase the domestic limit in the 2025 budget by N1.147 to close the gap.
Haruna urged the Senate to approve President Tinubu’s borrowing request from the domestic market to close the unfunded deficit gap created by the increase in the budget size.
Sen. Abdul Ningi (APC – Bauchi) said there was need to act on the committee’s recommendations, advising that Committee on Appropriation should, as a matter of exigency, liaise with both the Debt Management Office and the Budget Office to ensure adequate appropriation to service the budget.
“We call on the appropriation committee to give this senate an analysis and development on the borrowing.
“So from oversight, implementation and utilisation of proceeds from the borrowing, receiving quarterly reports, monitoring compliance,” he said.
Sen. Adeola Solomon (APC-Ogun) commended the committee for the report on, describing it as a beautiful report.
Adeola said, he agreed 100 per cent with the findings of the committee, saying it was a true reflection of what transpired during the budget process.
He said to fill the borrowing gap, there was need to come up with the plan on how the money would be sourced within the shortest possible time.
This, he said would enable continuous funding of the 2025 Appropriation Act, especially implementation of the capital components of the budget via project execution.
Senate after approval of the loan request urged Federal Ministry of Finance and Debt Management Office to undertake the borrowing strictly within approved fiscal parameters, ensuring that all terms and conditions are favourable, transparent and sustainable.
It also mandated Committee on Local and Foreign Debt to oversee implementation and utilisation of proceeds from the approved borrowing.
It urged the committee to receive quarterly reports from the Ministry of Finance and Debt Management Office on the status, utilisation and repayment plans, monitor compliance with debts, sustainability, threshold and fiscal responsibility.
It also urged the committee to review the implementation and utilisation of proceeds from the approved fiscal parameters
It further mandated committee on appropriation to ensure that the borrowing was actually used for the purpose for which it is required to fund the deficit in 2025 appropriation bill
Deputy President of Senate, Sen. Barau Jibrin (APC-Kano), who presided over plenary commended the committee on local and foreign debts for a job well done.
“The report is precise, direct to the point and very clear. On behalf of the Senate, I commend the committee and thank the chairman, deputy chairman and members for their diligent work in a very short time,’’ Jibrin said.
