Summary:
Despite widespread calls for austerity, legislative reviews in 13 states have seen over N1 trillion added to 2026 budget estimates, exacerbating fiscal deficits and increasing reliance on borrowing amid rising debt-servicing burdens.
In a trend that directly contradicts growing calls for fiscal prudence, a legislative review has revealed that no fewer than 13 State Houses of Assembly across Nigeria have unilaterally injected over N1 trillion into the 2026 budgets presented by their respective governors. This massive inflation of state appropriation bills comes at a time when sub-national governments are already buckling under the weight of debt servicing and economic instability.
An analysis by Saturday PUNCH shows a persistent pattern where state legislatures expand budget estimates, widening the fiscal deficit gap. This practice, often justified as necessary adjustments, has raised alarm bells among economic experts who warn of deepening insolvency.
The Additions by Numbers
The Lagos State House of Assembly leads the charge, adding a staggering N207.51 billion to Governor Babajide Sanwo-Olu’s initial N4.237 trillion proposal, bringing the final approved budget to N4.44 trillion. This marks the second consecutive year of significant budget padding by the Lagos legislature.
Following closely is Akwa Ibom, where lawmakers increased the budget by N194 billion (a 14% hike), pushing the total to N1.58 trillion. Notably, the additions were spread across both capital projects and recurrent expenditure, fueling concerns about bloated administrative costs.
Other states with significant budget expansions include:
- Cross River: N180 billion added.
- Kano: N109 billion added.
- Benue: N89.5 billion added.
- Gombe: N82 billion added.
- Delta: N65 billion added.
The Cost of Governance Crisis
This legislative inflation is occurring against a backdrop of severe fiscal strain. In the first half of 2025 alone, 20 states borrowed approximately N458 billion, while spending N235.58 billion on servicing external debts—a 68.4% increase from the previous year.
With 10 states planning to source over N4 trillion in loans and grants to fund their 2026 deficits, the decision to increase spending limits appears economically risky. Professor Taiwo Owoeye, an economist at the Federal University, Oye Ekiti, warns that this practice will inevitably lead to increased borrowing, deepening the debt trap for states already struggling with weak internally generated revenue (IGR).
A National Pattern
The trend is not isolated to the states. The National Assembly has also established a pattern of budget padding, having increased the 2025 federal budget by N790 billion above President Tinubu’s revised proposal.
While some states like Oyo, Enugu, and Kaduna maintained their original budget estimates, the widespread legislative expansion across 13 key states signals a continued prioritization of expenditure over austerity, potentially compromising long-term economic stability.