CENSOJ Urges FG To Adopt ‘Borrow Better’ Framework To Curb Rising Public Debt

The Centre for Economic and Social Justice (CENSOJ) has called on the Federal Government to adopt a “Borrow Better” framework as part of efforts to curb Nigeria’s rising public debt and ensure that future borrowing supports sustainable economic development.

The Executive Director of CENSOJ, Barrister Eze Onyekpere, made the recommendation during a presentation at a meeting with the Coordinating Minister of the Economy, Taiwo Oyedele, in Abuja.

Nigeria’s public debt has risen sharply in recent years, prompting growing concerns among economists and policy experts over the country’s debt sustainability and fiscal outlook.

According to the Debt Management Office (DMO), the nation’s total public debt increased from ₦87.38 trillion in June 2023 to about ₦159.28 trillion by the end of 2025, marking one of the fastest periods of debt accumulation in the country’s history.

The increasing debt burden has also led to higher debt servicing costs, which continue to consume a significant share of federally retained revenues, thereby limiting funding for critical sectors such as education, healthcare, infrastructure, and social development.

Onyekpere explained that the proposed “Borrow Better” framework is built on five key principles: borrowing only for productive investments; publishing cost-benefit analyses for all major loans; promoting public participation and transparency in debt management in line with the Fiscal Responsibility Act; prioritising concessional financing; and establishing measurable development outcomes for every borrowed naira.

He stressed that government borrowing should serve as an instrument for national development rather than a means of financing recurrent budget deficits.

According to him, countries repay debt with revenue—not Gross Domestic Product (GDP)—which underscores the importance of maintaining sustainable debt levels as stipulated by the Fiscal Responsibility Act. He noted that the Act also requires government borrowing to be tied to capital projects and human development.

“Borrowing should become an instrument of development, not merely a mechanism for financing budget shortfalls. Domestic resource mobilisation should precede additional borrowing,” Onyekpere said.

He further urged the government to make public the cost-benefit analyses of all major loans while ensuring greater transparency and citizen participation in debt management.

The CENSOJ Executive Director also expressed support for efforts to strengthen domestic resource mobilisation, noting that Nigeria’s tax-to-GDP ratio remains among the lowest globally due to weak tax administration, poor compliance, a large informal sector, and inefficient revenue collection.

However, he cautioned that improving government revenue should not necessarily translate into higher tax rates or the introduction of new taxes.

“Increasing revenue should not simply mean increasing tax rates or creating new taxes. It should mean improving tax administration and collecting existing taxes more efficiently,” he said.