…As Tinubu Orders Review Of Fiscal Responsibility Framework
As part of its ongoing tax reforms and fiscal policy measures aimed at improving transparency and accountability in the public finance system, the Federal Government has unveiled plans for a new framework that will put the electricity subsidies as a collective responsibility of all tiers of government in the country.
Giving this hint on Monday in his welcome remarks to participants at the 2026 Service-Wide Budget Training and Sensitisation Workshop for MDAs on the Government Integrated Financial Management Information System – Budget Preparation Sub-System (GIFMIS–BPS), the Director-General of the Budget Office, Yakubu Tanimu, said President Bola Tinubu had directed that his Office operationalise a clearer framework to share the cost of electricity subsidies across the federation so that the burden is not treated as an open-ended federal residual.
According to him, if the current clamour for improved and stable electricity is to be met, there must fair tariff regime and consumers must be ready to pay for the choices consumers make and this cannot be achieved when tariffs are held below cost, thereby creating a gap in payment for electricity supplied.
- Advertisement -
The Director-General maintained that in 2026, every stakeholder in the electricity industry must stop pretending that this bill can be left to the Federal Government alone, especially where the policy choice or the political benefit is shared across tiers of government.
He clarified: “Mr. President’s directive is to invoke the electricity-sector legal framework to make burden-sharing practical and transparent. This means: subsidy costs must be explicit, tracked, and funded—so they do not return as arrears, liquidity crises, or hidden liabilities in the market.
“It also means that if any tier of government chooses affordability interventions, the funding responsibilities must be clear, agreed, and enforceable. This is not punishment. It is alignment. When everyone carries a fair share of the cost, everyone also has an incentive to support cost-reflective efficiency, targeted protection for the vulnerable, and a power market that can actually deliver”, Tanimu added.
He explained that for MDAs, the implication is simple and implies making subsidy-related costs visible in the MDAs planning and submissions, avoidance of pushing liabilities into the market as arrears or unfunded commitments; and supporting transparent, rules-based attribution and financing of affordability decisions.
On why the workshop was organized by his Office, the Director-General attributed three reasons, including to translate policy intent into budget choices, raise the credibility of submissions and execution, and improve results for citizens, not just spending.
Noting that Nigeria is undergoing reforms to restore macroeconomic stability, rebuild credibility in public finance, and position the economy for sustainable growth, he said the reforms remained real and help the fiscal authorities to raise the bar for budgeting because reforms only succeed when implementation succeeds.
Tanimu told the participants at the workshop that what remained structurally different about the 2026 budget is that it is designed to correct the flaws in the implementation of the previous budgets such as rolling over of the budgets’ implementation and fragmented project lists, which had weakened their execution, reduce clarity, dilute accountability, and create hidden obligations.
He explained that the 2026 budget was designed to correct the past budgeting flaws as it is built as one coherent implementation framework and in line with President’s directive, to consolidate commitments into a single, visible pipeline and manage them as a disciplined programme of delivery.
Other benefits he listed in the 2026 budget design were that it improves prioritization, strengthens control, reduces duplication, and allows the government to know, at any point, what it has committed to deliver.
The Budget Office boss said that the submissions by every MDA would be assessed against the clear tests of Policy alignment programmes that must reflect national priorities, not institutional convenience; Credibility proposals that are implementable and backed by realistic assumptions; Consolidation proposals which must reduce fragmentation and improve visibility of total commitments; Value for money with emphasis on performance and measurable outcomes; and Fiscal sustainability: proposals that respect the fiscal rules and macro-fiscal realities.
He also disclosed that the President had directed that the MDAs should enhance the dynamism of fiscal rules through a review of the Fiscal Responsibility framework.
Tanimu stressed that fiscal rules remained not a slogan but are the guardrails of government without which spending becomes impulsive, debt becomes casual, and the budget becomes a statement of intent rather than a tool of delivery.
He pointed out that the rules must also be smart, respond to volatility without collapsing under pressure hence the 2026 direction is not to abandon rules, but to modernise them so they work in today’s Nigeria.
Specifically, he said the President’s directive was to review the Fiscal Responsibility framework to make it more dynamic and more enforceable, implying that clearer fiscal anchors, better-defined escape clauses for genuine shocks, and a credible path back to compliance when those clauses are used.
The Director-General expatiated: “It means stronger reporting, tighter discipline around contingent liabilities, and a firmer link between the medium-term framework and annual appropriations. For MDAs, this changes the conversation. You will not only be asked what you want to spend. You will be asked how it fits the fiscal rules, how it affects sustainability, and what measurable results it will deliver.”
He, therefore, charged the representatives of the MDAs at the workshop to treat fiscal compliance as part of programme design, build proposals that respect fiscal anchors and cash realities, justify trade-offs clearly, with outputs and outcomes, and identify and disclose risks early—especially contingent liabilities and commitments.
To promote project financing and bankable capital packaging, he said that the 2026 budget would strengthen the shift from project lists to project financing, hence in the fiscal year capital proposals must be delivery-ready; and where appropriate, they must be finance-ready.
Tanimu clarified: “A long list of projects is not a development strategy. It is often a map of disappointment. What citizens feel is delivery—completed roads, reliable power, functional schools, working hospitals. So in 2026, we are moving decisively from naming projects to financing and delivering projects. This is where project financing becomes central. It is not a buzzword. It is a discipline.
“ It means projects must be properly scoped, costed, sequenced, and packaged to attract the right mix of funding—budget, PPPs, blended finance, guarantees, and counterpart resources where relevant. It means readiness: designs, approvals, procurement strategy, and an implementation timetable.
“It means bankability: a credible revenue or service-payment logic, risk allocation, and clear governance. And it means prioritisation: fewer projects, better funded, better delivered. If we do this, the budget becomes a pipeline of completion, not a catalogue of unfinished work. That is the project-financing mindset Mr. President wants embedded across MDAs in 2026.
“Therefore, every capital submission must show: Readiness: designs, costing, approvals, procurement and delivery plan. Sequencing: what comes first, what can be phased, and why. Financing strategy: budget funding and any complementary financing route. Measurable results: outputs, outcomes and timelines”, he added.
