A civil society organization, CSO, the National Coalition on Accountability and Probity in Governance, NCAPG, has expressed concern over the Federal Government’s failure to release funds for capital projects in the 2024 budget.
Arogidigba Global Journal reports that the Senate and House of Representatives committees on appropriation had at a meeting with the presidential economic team on 8th January, 2025, criticized the Federal Government for poor funding of capital projects in the 2024 budget.
Head of the presidential economic team, Minister of Finance and Coordinating Minister of the Economy, Wale Edun, had at the meeting reported that overall, the 2024 budget performance was 43 per cent, with recurrent expenditure achieving 100 per cent while capital expenditure was just 25 per cent.
“Non-release of funds for capital projects is a major issue in the performance of the 2024 budget so far and it is desirable that funds are released to prevent abandoned projects and ensure the success of the Renewed Hope Agenda of the President,” Chairman of Senate Committee on Appropriation, Senator Solomon Adeola said at the meeting.
Speaking in on the development at a press briefing in Abuja on Tuesday, the National Coalition on Accountability and Probity in Governance, NCAPG, expressed concern over the delay in release of funds for capital projects in the 2024 budget.
According to NCAPG, the delay has resulted in significant economic challenges, including stalled projects, increased unemployment and reduced consumer spending.
National Coordinator of NCAPG, Igwe Ude Umanta, noted that the Federal Government’s inability to release capital to contractors has created a ripple effect across various sectors, leading to a decline in economic activity.
Umanta observed that many businesses, particularly those being owed by the government for executed contracts, are facing severe financial difficulties, including defaulting on loans.
Such companies, according to him, are forced to lay off workers, worsening the unemployment situation in the country.
Umanta added, “While we recognise and commend the Federal Government’s efforts to implement policies and reforms aimed at revitalizing our economy, it is evident that much more needs to be done to achieve stability and sustainable growth.
“Apparently, Nigeria’s economy is presently experiencing significant challenges, exacerbated by limited liquidity, and a lack of substantial capital releases to contractors on projects execution.
“It is very unfortunate that this worrisome reality has created a ripple effect across various sectors, leading to reduction in economic activity, largely contributing to stalled projects, and creating a surge in unemployment ratio.
“Realistically right now, Businesses, particularly those owed by the government for contracts executed, are facing dire straits. Many companies which are unable to recover payments are defaulting on loans, thereby leading to mounting debts, layoffs, and, in some cases, closures.
“Evidently, the Federal Government’s failure to make capital releases to contractors is at the heart of this economic stagnation. Capital projects are crucial drivers of economic activity, and the absence of funding for ongoing and new projects has led to significant setbacks, putting Capital release as missing catalyst which is very important to saddle the economy forward.
“Firstly, it is a pitiable realisation that contractors have been unable to complete critical infrastructure projects, from roads to healthcare facilities, which are vital to national development. Secondly, it is observed that the lack of liquidity in the economy has limited the purchasing power of citizens, further compounding the challenges of inflation and unemployment.
“It Is indeed acknowledged that the Federal Government is currently grappling with significant fiscal constraints. However, it is imperative for the FG to recognize that capital releases are not merely expenditures — they are investments that stimulate economic growth, create jobs, and improve infrastructure.”
Urging the Federal Government to prioritise economic stability and transparency in governance, NCAPG stressed the need for immediate action to address the nation’s challenges, including prioritizing capital releases to stimulate economic activity and create jobs.
The CSO called on the government to introduce targeted interventions to support Small and Medium Enterprises, SMEs, which are the backbone of the economy.
NCAPG also recommended the development of a clear and transparent repayment plan for contractors and businesses owed by the government.
According to the group, a clear repayment plan would not only boost liquidity but also rebuild trust between the government and private sector operators. It added that “regular communication with citizens is also crucial, providing updates on the status of economic policies, reforms, and projects”.
Commending the President Bola Tinubu administration for its efforts to implement policies and reforms, NCAPG however emphasized the need for tangible results.
To ensure effective implementation of the 2025 budget, NCAPG called on the economic team to report periodic progress on budget performance.