The Chairman House of Representatives Committee on Finance, Mr James Faleke says the government can no longer Subsidise Power in Nigeria.
He made the comment during the budget defense of the Ministries of Finance and other financial institutions, in Abuja.
The Acting Managing Director of the Nigerian Bulk Electricity Trading (NBET) Mr. Johnson Akinnawo, revealed that N705 billion is earmarked for electricity subsidies in 2025.
He also listed two hundred and seventy seven million naira for staff welfare for 2024.
This drew criticism from Lawmakers, who questioned the increase from the N450 billion spent in 2024, especially in light of rising electricity tariffs in the country.
Committee chairman Mr James Faleke asked the MD if the government was still funding Discos? To which he responded in the affirmative.
“As advised by the commission from time to time, the federal government continues to meet up with the difference between the tariff that the discos were allowed to charge and what the commission considers to be the cost reflective tariff. So, that Delta is met by federal government appropriation as has been listed in the 2025 that the federal government is able to meet up to seven hundred and five billion naira for that obligation,” Mr. Akinnawo said.
In a swift response, Mr. Faleke said that following the floating of the naira and regular increase in electricity tariff, the subsidy amount was no longer necessary.
He also flagged a proposed N277 million welfare allocation in NBET’s 2025 budget, saying the committee will remove it from the NBET budget.
Ministry Activities
The Minister of State for Finance, Mrs Doris Uzoka-Anite gave account of the activities of the Ministry.
She said that the ministry has been working with other government agencies to stabilise the economy.
She said that the ministry, though not a revenue generating agency, generated 14 million in 2024.
She said that the Ministry reported full utilization of its N8.16 billion budget in 2024 and requested a significant increase of N25 billion for 2025.
She said that the additional funds are intended to address issues such as exchange rate differentials, increased overhead costs, and capital expenditure needs.
“In 2024, we had N2,413,790,305. Overhead we have N1,809,809,393. The total budget for 2024 for the Federal Ministry of Finance was N8,106,450,530 Naira. Our performance based on 2024, the percent 100%, the overhead 100%, and the capital 22%.
“The total budget N2,495,300,769 (personnel), N3,565,556,897 (Overhead) and N7,450,800,902 for capital for 2025. That brings the total to N13,511,607,568.
“This include the issue of exchange rate depression. We go on our mandates we attend on behalf of the country, and international organizations,
“Our Offices look good from the outside but the inside needs a lot of rehabilitation. We wish that you can improve our capital allocation as well as the overhead. And we think that with the Senate committee on finance, we can improve our capital allocation and our overhead. Five goes to overhead,” she said.
Meanwhile, the Chairman Fiscal Responsibility Commission (FRC) Mr Victor Muruako urged the committee to amend their enabling Acts for better operational efficiency.
He raised concerns about over fifty offences in the Fiscal Responsibility Act lacking specified penalties.
Mr Muruako also appealed for increased funding, citing insufficient allocations for personnel and capital projects.
The commission reported a 38.18% capital release for 2024 and sought improved funding for 2025.
He said “In 2025, we have a total sum of N255,753,579 as our overhead with a total of N515,152,803 as our capital costs. Bringing a total cost of N1,415,357,014bn.
“Our capital releases as of 31st December 2024 is a total sum of N246,481,918.79. This is representing 38.18% of the total appropriation for the year. The recurrent appropriation was fully released as of 31st December 2024. Our personnel costs totaling N255,753,579 was released and expended by the Commission via IPPIS representing 100% of the total appropriation of personnel for the year.
“We make a case here to add that our personnel appropriation exhausted as of October. We had to ask for augmentation to enable our staff to be paid from October, November, and December. This delayed our staff payment for the period, sometimes up to three weeks.
“We also provided insufficient appropriation for personnel again in 2025. The Commission was allocated a very tight personnel appropriation, leaving no room for promotion, some allowances, The total proposed for personnel for 2025 is N361,871,239.
“Our overhead envelope is N738,291,539. And the capital is N596,930,905. Bringing in a constitute proposed appropriation for FRC in 2005 to =N=1,697,674.
“Our role in getting the government-owned enterprises and revenue agencies because we believe every agency is a revenue-generating agency, no matter the percentage. With the role we play, we have added impact to survive the years in independent revenue of the federal government.
“Not just because of what we can do, but because of your support. In 2022, a total of =N=1.3 trillion, comprising =N=181 billion as operating surplus and =N=1.1 trillion as IGR from NDAs, was tracked and facilitated with your support by the Commission. This figure was improved upon in 2023 as a total sum of =N=1.8 trillion was generated.
“In 2025, a total of allocation of five point five eight billion naira with a personnel cost of three point five nine nine billion naira and then capital budget for 2025 =N=906,120,895 and then overhead =N=1.066 billion for 2025.
The committee however resolved to meet with the Nigerian Electricity Regulatory Commission (NERC) and NBET for detailed justification of the N705 billion subsidy under the Power Reform Programme. Until then, further consideration of the proposed budget remains on hold.
Other agencies, including the Ministry of Finance Incorporated, MUFI, and the Ministry of Interior, also presented their budget proposals and defended their expenditures for 2024.
Committee members asked various questions from the heads of agencies before discharging them.
Confidence Okwuchi
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