The trio of Lagos, Akwa Ibom and Rivers states plan to spend more than 15 other states of the federation combined in 2021, a PREMIUM TIMES’ review of the budgets of the 36 states has found.
The 15 other states are at the bottom of the ranking of states’ planned spendings for 2021.
The 36 states of the federation have a combined total budget of over N9 trillion. Out of this, Lagos, Akwa Ibom and Rivers plan to spend N2.07 trillion, an equivalent of 23 per cent. The other 33 states have a combined spending plan of N6.3 trillion.
A state-by-state breakdown of the 2021 budgets shows that Lagos, Nigeria’s economic hub, has the highest spending plan with a N1.163 trillion budget.
About 60 per cent of that (or N700 billion) will be used to meet its capital obligations, while recurrent expenditure is planned to gulp N460 billion.
In terms of wealth, Lagos is invariably the richest state in the country, generating higher than at least 29 states in the first half of 2020.
Also, the state is arguably the most populous and has the least poverty count with only five in every hundred of its residents earning less than ₦377 per day.
On the 2021 budget table, at a distant second is oil-rich Akwa Ibom State which plans to spend N456 billion this year, about the same amount (N448 billion) budgeted by Rivers State.
Akwa Ibom is one of Nigeria’s cosmopolitan cities and ranks sixth in terms of revenue generation – although, the largest chunk of that is from federal allocations.
The state plans to spend N241 billion on capital projects and N164 billion on recurrent obligations.
In the number three slot, Rivers, unarguably the second richest state in the country, will spend N306 billion on infrastructure and N142 billion on recurrent expenditure.
Despite high earnings, both Rivers and Akwa Ibom are among the states housing the highest number of unemployed Nigerians, a reality analysts believe is due to the states’ lack of people-driven social programmes.
Behind these states is Delta which signed a budget of N383 billion; Ogun, N338 billion; Imo 332 billion; Bayelsa N329 billion; Katsina N282 billion; Cross River, N277 billion and Oyo, N268 billion.
Katsina State is the only state in the northern part of the country among the top 10 states with the highest budget for 2021.
However, budgetary plans do not translate to eventual spending in any of the states.
Least spending states
Meanwhile, afoot the ranking of the states are Adamawa with N140 billion; Taraba, N139 billion, Kwara; N137 billion; Benue; 134 billion; Abia, N131 billion; Kogi, N130 billion; Ebonyi N122 billion and Gombe, N120 billion.
Other states with the least budget are Nasarawa with N115 billion; Ekiti, N109 billion; Osun, N109 billion and Yobe, N106 billion.
Therefore, while Lagos, Akwa Ibom and Rivers plan to send a total of N2.07 trillion, the bottom 15 states plan to spend N1.9 trillion.
Based on the 2019 poverty and inequality report by Nigeria’s statistics bureau, about nine in every ten persons in Taraba are poor, but in Ebonyi and Adamawa, eight in ten fell under that category. In Yobe, the state with the lowest budget, seven in ten people are poor.
The total budget for these bottom states is not close to the total for Lagos, Akwa Ibom and Rivers states.
Five of the top ten states with the highest appropriation for 2021 are in the South-south region.
Edo, the sixth state in the region, ranks 18th on the log. Poverty rate in the state is 11 per cent.
Likewise, Imo is the only south-east state in the top ten category. The state has a relatively impressive IGR.
Nevertheless, with a 28 per cent poverty rate, it is the unemployment headquarters of the country, a record it maintained in the second and fourth quarter of 2020.
Borno State has a spending plan of N248 billion; Kaduna, N246 billion; Bauchi, N213 billion; Kano, N177 billion; Sokoto, N176 billion; N174 billion; Enugu, N169 billion; and Edo, N164 billion.
Others are Jigawa, N156 billion; Niger, N153 billion; Plateau, N147 billion; Anambra, N147 billion; Zamfara, N142 billion; and Kebbi, N141 billion.
On the brink
This past year has seen states’ revenue reduce with many also cutting down on expenditure. The COVID-19 pandemic triggered a severe budget crisis which made federal and state governments take austere measures by cutting their budget size to stay afloat.
State revenues also declined due to a fall in oil prices, amidst an increase in food prices, with Nigeria witnessing its worst inflation in 11 years.
At the federal level, Nigeria will have to rely on borrowing to finance its spending plan. The country targets revenue of N7.8 trillion, but it has never collected this much, even when oil prices were higher. A quarter of its total budget (N3.3 trillion) will be used for debt services while the fiscal deficit was put at N5.2 trillion.
The budget deficit of N5.2 trillion will be financed by both local and concessionary loans from the International Monetary Fund, the World Bank, Islamic Development Bank and Afreximbank. The government also plans to sell assets to cover some of the shortfalls.
Source:- Premium Times