The approval of the 2025-2027 Medium Term Expenditure Framework and Fiscal Strategy Paper by the House of Representatives signals a crucial step in the budget process. The MTEF and FSP are essential documents that guide public expenditure and fiscal policy over multiple years, ensuring consistency in financial objectives.
The government, led by President Bola Tinubu, set parameters such as an oil benchmark of $75 per barrel for 2025, with a projected daily oil production of 2.06 million barrels. Additionally, exchange rate parameters were fixed at N1,400 per dollar, with a projected GDP growth rate of 6.4% annually.
During deliberations on the MTEF, there were differing opinions on certain projections, such as the oil benchmark and domestic crude oil production targets. Despite concerns raised by some members, the House ultimately adopted the $75 benchmark and other recommendations put forth in the MTEF.
It was noted that setting realistic targets is crucial to avoid overestimation and maintain financial stability. Members highlighted the need for continuous review and adjustment of projections as needed, acknowledging the volatility of factors like oil prices and currency exchange rates.
Overall, the approval of the MTEF and FSP outlines a roadmap for government spending and fiscal policy in the coming years, with a focus on responsible projections and effective financial management.