The Federal Government has dismissed claims that it spent more than N8 trillion, equivalent to about two per cent of Nigeria's Gross Domestic Product (GDP), outside the approved budget.

The FG described the allegation as false and a misrepresentation of the International Monetary Fund's (IMF) 2026 Article IV Consultation Report.

In a statement issued on Sunday, the Federal Ministry of Finance said recent public commentary based on references to the IMF Resident Representative in Nigeria and the Fund's report had wrongly suggested that the government operated a "shadow budget."

The ministry maintained that the Federal Government does not spend public funds outside the constitutional and statutory framework governing public finance.

According to the statement, government expenditure is strictly guided by Sections 80–83 and 162 of the 1999 Constitution (as amended), which require that public funds be withdrawn and spent only in accordance with the Constitution and laws enacted by the National Assembly.

The ministry explained that federal spending is carried out through duly enacted Appropriation Acts, Supplementary Appropriation Acts and other statutory authorities approved by the National Assembly.

It added that multi-year capital projects implemented across different budget cycles are recognised under existing laws and should not be mistaken for off-budget spending.

"It is inaccurate to suggest that trillions of naira have been secretly spent outside legislative approval," the ministry stated.

It noted that such allegations should be supported with specific projects and credible evidence.

The government further clarified that several expenditures are authorised under separate legal frameworks outside the annual Appropriation Act but remain lawful.

These include statutory allocations to development commissions and agencies, cost of collection retained by revenue-generating agencies, debt service obligations, capital expenditure for certain agencies and the Federal Capital Territory, as well as interventions for security, infrastructure, disaster response and other national priorities.

According to the ministry, such expenditures are neither secret nor illegal but are established by law, disclosed in fiscal reports and subjected to oversight and audit mechanisms.

It also rejected suggestions that the reported amount automatically translated into a wider budget deficit, explaining that a fiscal deficit depends on the relationship between government revenue and total expenditure rather than the financing mechanism used for approved projects.

The ministry said the IMF's observations were primarily about the comprehensiveness, timing and presentation of fiscal reporting, not the legality of government spending.

It added that Nigeria is already implementing reforms to align its budget presentation with international fiscal reporting standards, recalling that President Bola Ahmed Tinubu had, during the presentation of the 2026 Appropriation Bill to the National Assembly on December 19, 2025, called for the harmonisation of multiple and overlapping budgets into a single, cohesive framework.

The Federal Government reaffirmed its commitment to prudent fiscal management, transparency and accountability, noting that recent reforms have strengthened budget credibility, revenue administration, treasury management and the digitalisation of public financial processes.

While acknowledging the importance of public scrutiny, the ministry urged commentators to ensure that public debate is guided by facts and an accurate understanding of Nigeria's constitutional and fiscal framework, warning against presenting technical reporting issues as evidence of unlawful expenditure.