The Nigeria Extractive Industries Transparency Initiative (NEITI) has reported that no state in the country can totally finance its annual budget with its Internally Generated Revenue (IGR) and resources received from the Federation Accounts Allocation Committee (FAAC).
The agency, in its latest edition of its quarterly magazine, noted that despite the substantial distributions to the sub-national governments at the Federation Account Allocation Committee’s (FAAC’s) meetings on monthly basis, all of them still continued to contend with yearly deficit budgets.
Specifically, NEITI reported that there was virtually none of the states that can adequately finance their budgets from IGR and FAAC disbursements, noting that the states will have to resort to different levels of borrowing to meet their budgetary obligations.
It stated further that the gap between the budgets and revenues is below N50 billion in three states namely, Enugu, Taraba and Yobe.
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The report stated further: “The difference between the revenues and budgets is between N50 billion and N100 billion in 14 states (Abia, Anambra, Delta, Edo, Ekiti, Gombe, Jigawa, Kebbi, Kogi, Nasarawa, Niger, Ondo, Plateau and Zamfara).
“However, this difference is above N100 billion in majority of the states (Adamawa, Akwa Ibom, Bauchi, Bayelsa, Benue, Borno, Cross River, Ebonyi, Imo, Kaduna, Kano, Katsina, Kwara, Lagos, Ogun, Osun, Oyo, Rivers, Sokoto).
“Akwa Ibom, Cross River, Lagos and Ogun states present special cases as the difference in these states is above N200 billion. Although IGR is historically high in Lagos and Ogun states, it is very unlikely that the states’ actual IGR for 2018 will be sufficient to cover the difference between revenue and budgets”, NEITI added.
It recalled that the FAAC shared a total of N2.28 trillion among the three tiers of government in the third quarter (Q3) of 2018, with the Federal Government getting N904.8 billion while states and local governments collected N718.5 billion and N432.1 billion respectively.
According to the report, the total FAAC disbursements in Q3 2018 remain the highest recorded since the second quarter of 2014, with the closest being the second quarter of this year when N2.008 trillion was disbursed to them by the FAAC.
