The Ministry of Finance and Development Planning (MFDP) has issued a strict directive to government spending entities, urging them to prioritize their spending in light of ongoing resource shortages. In a memo signed by Finance Minister Augustine Kpehe Ngafuan and sent to Ministries, Agencies, and Commissions, the Ministry highlighted the challenge of limited resources and emphasized the need for fiscal prudence.
The memo, released on Thursday, February 20, 2025, reminded heads of spending entities to remain mindful of the scarcity of resources as they manage their budgets for the fiscal year. “Scarcity of resources is a reality, and all Heads or Senior Management of Spending Entities must not lose sight of this reality. You’re advised to prioritize the priorities,” the Ministry stated.
The directive stressed that all government spending entities must adhere to their approved budgets for the Fiscal Year 2025 and exercise caution in the use of funds. The Ministry further urged entities to avoid overextending their budgets early in the year, warning that no supplemental resources would be made available if budget lines are exhausted prematurely. “Your budget is for the entire 12 months of 2025. So, you’re strongly advised NOT to execute your budget as if it were a six-month or one-quarter budget,” the Ministry cautioned.
The Ministry also reminded government institutions that the 2025 budget, which totals US$880.7 million, is a projection until actual revenues are generated. This marks a 19.2% increase over the previous year’s budget, but still falls short of the over US$2 billion in funding requests submitted by spending entities during the budget formulation process.
Despite the growth in the budget, the Ministry noted that many government entities have already submitted requests for additional funds to address unforeseen spending priorities. The MFDP emphasized that the first source for funding these new demands should be the spending entities’ budgets.
With only US$3.26 million allocated as a contingency reserve in the budget, the Ministry explained that the available unallocated funds are insufficient to cover the numerous unforeseen demands that may arise throughout the year. As a result, the Ministry may need to make difficult decisions regarding reallocating funds from other budgeted areas to meet these spending pressures.
The Ministry concluded by calling for the full cooperation of all spending entities to ensure the efficient and effective execution of the national budget in this challenging fiscal environment.
