Nearly half of the federal and 36 state governments’ budgets of N12.2 trillion for the year will be spent on salaries and overheads, our source investigation has shown.
Each of the two tiers has N6.1 trillion, but N5.33 trillion of the total (43.7 percent) will be expended on salaries and overheads.
This is coming at a time of concerns over the swollen recurrent expenditures in the face of dwindling oil revenues and low votes for development projects.
The total amount earmarked for capital projects by the central and the state governments this year is N5.04 trillion (41.3 percent); N3.3 trillion for the states and N1.75 trillion for the federal government.
The total budget carries a combined deficit of N4.5 trillion (36.9 percent), which is made up of N2.3 trillion for the states and N2.2 trillion for the federal government.
The federal government’s budget of N6.06 trillion has recurrent expenditure component of N2.65 trillion (44 percent) and N1.75 trillion (29 percent) for capital projects. The remaining balance of N1.66 trillion (27 percent) was for debt servicing and statutory transfers.
Capital spending by the 36 states is N3.3 trillion, which is 54 percent of their total budgets, while recurrent gulps N2.7 trillion (44 percent).
The 19 northern states have a total budget of N2.5 trillion, of which N1.4 trillion (56 percent) was for capital and N1.1trillion (44 percent) for recurrent. The northern states have a total deficit of N1.3 trillion (54 percent).
The 17 southern states have a total of N3.5 trillion budget comprising N1.9 trillion (54.2 percent) capital and N1.5 trillion (44 percent) recurrent. The southern states have a total deficit of N1.1 trillion (31percent).
States with low budgets
Six states with the lowest approved budgets are Ekiti (N67 billion), Niger (N74.7 billion), Gombe (N76.5 billion), Nasarawa (N77 billion), Enugu (N85 billion) and Yobe (N88.9 billion). They have a total budget of N469 billion, comprising N261 billion recurrent expenses and N210 billion capital vote. Their total deficits amount to N126 billion.
States with high budgets
The big spenders are Lagos (N662 billion), Akwa Ibom (N423 billion), Cross River (N350 billion), Rivers (N307 billion), Kano (N274 billion) and Delta (N268 billion) with N2.3 trillion between them or about one sixth of federal and states budget combined.
Of this sum, N1.4 trillion is for capital projects and N859 billion recurrent. But they have a combined deficit of N774 billion.
One of the states with swollen recurrent expenses is Osun whose Governor Abdulrauf Aregbesola budgeted N150 billion for 2016. Of this amount, N113 billion is for recurrent and N37 billion for capital votes.
Another state in this league is Zamfara, where Governor Abdulaziz Yari, chairman of the Nigerian Governors’ Forum (NGF), budgeted N109 billion, out of which N69.8 billion is for recurrent and N39.4 billion for capital expenditure.
In Taraba, Governor Darius Ishaku budgeted N100 billion for the year, setting aside N60 billion for recurrent spending and N40 billion for capital projects.
Niger State also has a higher recurrent vote, standing at N39.5 billion out of N74.7 billion, leaving N35.2 billion for capital expenditure.
Kogi State votes N99.9 billion, setting aside N58.2 billion for recurrent and N41.7 billion for capital spending.
Of the N76.5 billion Gombe expenditure, N42.5 billion is for recurrent and N34.4 billion for capital expenses.
Delta State Governor Ifeanyi Okowa budgeted N268 billion for the year. Recurrent vote will consume N153 billion, leaving N114 billion for capital spending.
His Ondo counterpart, Olusegun Mimiko, has N123.7 billion budget. While recurrent gets N69 billion, capital takes N54.5 billion.
Bayelsa State Governor Henry Seriake Dickson budgeted N170 billion, comprising N35 billion for capital projects and N135 billion for recurrent spending.
Of Oyo State budget of N173 billion, N100 billion was earmarked for recurrent expenditure while the remaining N73 billion is for capital spending.
In Nasarawa, Governor Tanko Al-Makura budgeted N77 billion, of which N43 billion is for recurrent expenses and N34 billion capital.
Gombe State which has the least budget deficit of N573 million has a former accountant general of the federation as governor. The former oil producing state of Cross River has the highest budget deficit of N283 billion in the country.
Other states with high deficits include Akwa Ibom (N139 billion), Lagos (N119 billion), Kano (N117 billion), Jigawa (N94 billion), Plateau (N69 billion) and Bauchi (N68 billion).
The total budgets of the six states of the northeast (N676 billion) are about the same with that of Lagos (N662 billion) alone. On the other hand, the northeast’s total budget deficit of N202 billion is almost double of Lagos’ N120 billion.
On geopolitical basis, the seven states of the northwest zone have a total budget of N1.12 trillion. The capital expenditure is N698 billion and N479 billion recurrent. The zone has N333 billion budget deficit.
The total budget for the northeast zone is N676 billion, with capital expenditure consuming N347 billion, leaving N326 billion for recurrent. The zone has a budget deficit of N202 billion.
The north central zone’s approved budget for the year is N684 billion. N385 billion is for capital and N343 billion for recurrent spending. This zone’s budget has a deficit of N194 billion.
On the other hand, the southwest zone’s budget for the year is N1.4 trillion, with recurrent spending consuming N695 billion, leaving N671 billion for capital component. The region has a budget deficit of N316 billion.
The south-south region has a total budget of N1.6 trillion, comprising N949 billion capital and N579 billion recurrent expenditures. The region’s budget deficit is N628 billion.
The southeast’s total budget is N490 billion, made up of N248 billion recurrent and N242 billion for capital projects. The five states of the zone have a total deficit of N115 billion.
High budgets, low IGR
Though the 36 states of the federation budgeted N6.1 trillion for the year, their combined Internally Generated Revenue (IGR) is just little above half a trillion naira.
Data from the National Bureau of Statistics (NBS) show that the IGR of the entire states dropped by N24 billion-from N707 billion in 2014 to N683 billion in 2015.
The total IGR of the 17 southern states is five times bigger than that of the 19 northern states in 2015. The northern states generated N111 billion, while the south got N580 billion.
Lagos state alone generated N268 billion in 2015, which is two times higher than the combined IGR of the 19 northern states. The Lagos IGR is also higher than the combined revenue generated by the oil-producing south-south (N179 billion) and southeast (N62.4 billion).
The northeast generated N24.2 billion, northwest N48.2 billion, north-central N38.4 billion, and southwest N340 billion, last year.
Some of the states with the lowest IGR are Yobe (N2.2 billion), Zamfara (N2.7 billion), Ekiti (N3.2 billion), Borno (N3.5 billion), and Kebbi (N3.5 billion).
Other states with highest IGR after Lagos are: Rivers (N82.1 billion), Delta (N40.8 billion), Ogun (N34.5 billion), Edo (N19.1billion), and Enugu (N18 billion).
Poor IGR collection is not the only challenge the federal and states authorities have to grapple with. Daily
Trust reported in February how centrally collected revenue shared by the federal, state and local governments dropped by N2.8 trillion between 2014 and last year.
Analysis of official documents from the federal ministry of finance shows that the three tiers of government
shared N8.6 trillion in 2014 but the figure slumped to N5.8 trillion in 2015 due to the continuous global slide in crude oil price.
The revenue continues to slide this year as the three tiers of government shared a total of N281.5 billion for April, last week. As a result of their level of indebtedness, some states go home with little portion of their federal allocation after deductions.
Osun state, for instance, went home with N132 million only out of the N2.3 billion due to the state for the month of March. It is not clear how Governor Aregbesola will finance his N150 billion budget with an annual IGR of N8 billion and monthly federal allocation of N132 million.
Of its N2.4 billion federal allocation for March, Cross River got only N967 million after deductions. But the state has an annual budget of N350 billion with an annual IGR of N13.5 billion. How Governor Ben Ayade will fund his budget remains to be seen.