The Federal Government has introduced stricter verification requirements for newly recruited workers seeking admission into its payroll system, as personnel expenditure rose to ₦1.96tn in the first quarter of 2026, exceeding capital spending by approximately ₦267bn.
The new directive, announced by the Office of the Accountant-General of the Federation (OAGF), is aimed at strengthening payroll controls, preventing irregular enrolments and ensuring that only duly verified employees are admitted into the Integrated Personnel and Payroll Information System (IPPIS).
Key Highlights
- Federal Government personnel expenditure reached ₦1.96tn in the first quarter of 2026.
- Personnel costs exceeded capital expenditure of ₦1.69tn by approximately ₦267bn.
- The OAGF has introduced stricter verification requirements for newly recruited federal workers.
- All new employees must be captured on their respective Ministries, Departments and Agencies’ nominal rolls before payroll enrolment.
- Federal Government revenue stood at ₦5.08tn against a quarterly target of ₦9.22tn.
- Debt servicing reached ₦4.63tn during the period, further increasing fiscal pressure.
The new measures were announced on Monday in a statement signed by the OAGF’s Director of Press and Public Relations, Bawa Mokwa. The directive takes immediate effect and applies to all ongoing and subsequent payroll admission processes under IPPIS.
The statement said: “Henceforth, no newly recruited employee shall be enrolled without first being captured on the nominal roll of the relevant MDA and satisfying all prescribed validation and eligibility requirements.”
FG Personnel Costs Rise to ₦1.96tn
According to the Federal Government’s First Quarter Budget Implementation Report for 2026, personnel expenditure reached ₦1.96tn between January and March, compared with ₦1.82tn in the corresponding period of 2025.
The report showed that personnel spending exceeded capital expenditure, which stood at ₦1.69tn during the quarter.
This represents a difference of approximately ₦267bn, with personnel costs accounting for 20.05 per cent of the Federal Government’s total expenditure of ₦9.76tn, while capital expenditure represented 17.32 per cent.
A breakdown showed that personnel costs for Ministries, Departments and Agencies (MDAs) increased from ₦1.57tn in the first quarter of 2025 to ₦1.70tn in the corresponding period of 2026.
Personnel expenditure by Government-Owned Enterprises remained unchanged at ₦254.35bn.
The figures also indicated that the Federal Government spent an average of ₦652.37bn monthly on personnel costs during the review period, compared with ₦607.73bn in the corresponding period of 2025.
Despite the increase, actual personnel spending remained below the quarterly budget projection.
The Budget Office disclosed that ₦8.35tn was allocated to MDA personnel costs in the 2026 budget, representing an increase of approximately ₦758.51bn from the ₦7.60tn allocated in 2025.
The report stated that actual expenditure of ₦1.70tn was released in the first quarter, leaving a shortfall of ₦385.78bn, or 18.47 per cent, against the prorated quarterly projection of ₦2.09tn.
FG Records Capital Budget Implementation Shortfall
While personnel expenditure continued to rise, implementation of the Federal Government’s capital budget remained significantly below expectations.
The report showed that total capital expenditure of ₦1.69tn fell short of the prorated quarterly projection of ₦8.07tn by ₦6.38tn, representing a shortfall of 79.06 per cent.
More significantly, no funds were released for the implementation of MDAs’ 2026 capital budget during the quarter, despite a prorated allocation of ₦3.92tn.
The Budget Office explained that some MDAs were still utilising funds released under the 2025 capital budget, whose implementation period had been extended to December 31, 2026.
Consequently, implementation of the 2026 MDA capital budget stood at zero as of March 31, although expenditure was recorded under other capital components.
Government-Owned Enterprises accounted for ₦740.32bn in capital expenditure, while the Tertiary Education Trust Fund recorded ₦393.56bn.
Multilateral and bilateral project-tied loans contributed ₦287.44bn, while grants and donor-funded projects accounted for ₦249.50bn.
Rising Personnel and Pension Costs Increase Fiscal Pressure
The pressure on government finances was further reflected in non-debt recurrent expenditure, which increased from ₦2.24tn in the first quarter of 2025 to ₦2.77tn in the corresponding period of 2026.
Personnel costs accounted for 70.73 per cent of non-debt recurrent spending during the period.
Expenditure on pensions and gratuities, including service-wide pensions, also increased from ₦161.60bn to ₦330.72bn, representing a rise of ₦169.12bn, or 104.65 per cent.
When pensions and gratuities are combined with personnel costs, the Federal Government’s expenditure on these obligations reached ₦2.29tn, compared with ₦1.98tn in the corresponding period of 2025.
However, the report classified pensions and gratuities separately from personnel expenditure.
FG Revenue Falls Short as Debt Servicing Reaches ₦4.63tn
The rising expenditure obligations coincided with weak revenue performance.
According to the Budget Office, the Federal Government generated approximately ₦5.08tn in the first quarter of 2026, against a quarterly target of ₦9.22tn, representing a shortfall of 44.93 per cent.
Personnel costs alone were equivalent to 38.56 per cent of actual revenue, meaning that for every ₦100 received by the government, nearly ₦39 went towards personnel expenditure.
Debt-service payments further constrained government finances, reaching ₦4.63tn, equivalent to approximately 91.18 per cent of actual revenue.
Combined personnel costs and debt-service obligations amounted to ₦6.58tn, exceeding government revenue by approximately ₦1.51tn.
The Federal Government recorded a fiscal deficit of ₦4.69tn during the period.
The Budget Office acknowledged the need to contain recurrent expenditure, noting that restrictions on unapproved recruitment remained part of the government’s expenditure management measures.
It said the Federal Government continued to pursue its goal of controlling recurrent spending as outlined in the 2026–2028 Medium-Term Expenditure Framework and Fiscal Strategy Paper.
New Payroll Verification Requirements for Federal Workers
Under the latest arrangement, MDAs will assume greater responsibility for managing personnel budgets and maintaining accurate nominal rolls.
The OAGF explained that agencies seeking to enrol newly recruited employees must submit formal requests accompanied by recruitment approvals, appointment letters, applicable waivers and other supporting documents.
The documents will undergo verification alongside salary structures, grade levels, salary steps, allowances and other financial entitlements to establish the legitimacy of appointments and the accuracy of payroll obligations.
The validation process will also cover statutory details, including Pension Fund Administrator information, pension identification numbers, National Housing Fund registration and tax records.
Following the initial verification, employee records will be forwarded to the relevant MDA for confirmation and endorsement by the Accounting Officer, Director of Human Resources, Director of Finance and Accounts, and designated Payroll Validating Officer.
The records will subsequently be returned to the OAGF for final processing.
The office stated that final admission into the Federal Government payroll would depend on the satisfactory completion of all validation procedures and approval by the Accountant-General of the Federation.
Permanent Secretaries, Heads of Agencies and other relevant officials have been directed to ensure strict compliance.
The OAGF warned that incomplete documentation or unresolved discrepancies would result in the deferment of payroll admission until all requirements were met. It also said officers responsible for processing and approving payroll enrolments would be held accountable for breaches of applicable regulations.
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Economists Raise Concerns Over FG Spending Priorities
Reacting to the figures, Nigerian economist and Chief Executive Officer of CSA Advisory, Dr Aliyu Ilias, expressed concern that personnel expenditure had exceeded capital spending, warning that the trend could undermine investment in critical infrastructure.
Ilias said the government needed to prioritise capital projects because of their importance to education, healthcare, transportation and other essential services.
He described the situation as an anomaly, arguing that social infrastructure was critical to economic and national development.
Although he acknowledged that salary payments and debt servicing were obligations the government could not avoid, he warned that the spending pattern raised serious concerns about fiscal priorities.
Ilias also criticised repeated extensions of budget implementation periods, arguing that the practice weakened clarity and accountability in public expenditure.
He called on the National Assembly to strengthen its oversight of budget implementation and demand explanations for government spending decisions.
Also speaking, investment banking and financial policy expert and Chief Executive Officer of CFG Advisory, Dr Tilewa Adebajo, warned that Nigeria’s fiscal position was becoming increasingly difficult to sustain.
Adebajo said recurrent expenditure and debt servicing were limiting the resources available for productive investment, adding that macroeconomic reforms alone would not improve living standards without stronger economic growth and fiscal discipline.
He stressed that capital expenditure was essential to expanding the economy and warned that persistent underfunding of development projects could undermine the benefits of economic reforms.
According to him, Nigeria needs to focus on fiscal discipline, productivity, private-sector investment, export diversification and improvements in household welfare.
He maintained that macroeconomic stability should serve as the foundation for economic prosperity rather than an end in itself.
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