State governments’ proposed recurrent expenditure, comprising salaries and overheads, has increased by 30 percent this year compared to last year, according to an analysis of the states’ 2014 budget presentations.
The 36 states have proposed to spend N2.740 trillion on salaries, allowances, overheads and other components of recurrent expenditure.
This figure is about 30 percent higher than last year’s N2.105 trillion budgeted for the same purposes.
This is coming in spite of concerns over the bourgeoning recurrent expenditures of government at all levels and the relegation of development projects.
An analysis of the budget estimates announced by the 36 state governments show that N6.596 trillion has been presented to their various houses of assembly for approval.
Of this, only N3.856 trillion (58.5%) was earmarked for capital projects and development, while the remaining N2.740 trillion (41.5%) was voted for recurrent expenditure.
Daily Trust exclusively reported last year that of the N4.96 trillion budget estimates announced by 28 states, recurrent expenditure got N2.105 trillion (42.4%), leaving only N2.856 trillion (57%) for capital projects.
This same trend was the basis for Central Bank governor Sanusi Lamido Sanusi’s lamentation last year when he said that over 70 percent of government budgets are spent on recurrent expenditure.
He said an over bloated civil service and the many political offices are soaking up too much of the public funds, sparing very little for capital projects.
Daily Trust investigations revealed that few states devoted substantial parts of their budgets to capital projects, as many of them voted more than half of their estimates to running their bureaucracy.
In an exclusive report, Daily Trust last month revealed that only Lagos State is able to pay workers’ salaries and other entitlements from its internally generally revenue (IGR).
The remaining 35 states solely relied on monthly federal allocations to do so, meaning that even this year, the states have to solely rely on the federal funds, mostly sourced from oil monies explored in Niger Delta, to service the huge recurrent expenditure.
Geopolitical analysis
Thorough analysis of the budgets show that of the N1.017 trillion total estimates for this year announced by the seven states in the North West zone, N368 billion was for recurrent spending while N649 billion was earmarked for capital votes.
The North East zone has total estimates of N700 billion, of which N300.5 billion was for recurrent expenditure and N399.5 for capital projects.
North Central zone budgeted N380 billion for recurrent spending and N528 billion for capital projects, totaling N908 billion.
The South West states have a total budget of N1.370 trillion with N640 billion for recurrent and N730 billion for capital expenditures.
The five states in the South East zone budgeted N617 billion for the year; N288 billion for recurrent vote and N331 billion for capital spending.
The oil-producing South-South zone budgeted N1.980 trillion for the year, N762 for recurrent and N1.217 for capital.
State-by-state analysis
There are at least eight states which have higher recurrent budgets than capital, namely Taraba, Anambra, Oyo, Bayelsa, Kogi, Benue, Adamawa and Nasarawa.
Anambra’s recurrent budget estimate is more than double its capital votes. The state has a N140 billion budget; N100 billion for recurrent and N40 billion for capital.
Bayelsa has a total estimate of N299 billion. It allocated N162 billion for recurrent and N136 billion for capital.
Of the N80 billion budgeted for Taraba, recurrent spending got N42 billion, leaving N38 for capital projects.
Oyo has a total estimate of N189 billion, with recurrent expenditure taking N96 billion and capital N93 billion.
Adamawa State budgeted N58 billion for recurrent and N40 billion for capital, totaling N98 billion; Kogi has N150 billion total estimate, recurrent N80 billion and capital N70 billion.
Of the N105 billion Benue’s budget, N64 billion was voted for recurrent and N41 billion for capital; while its neighbouring Nasarawa has N60 billion recurrent and N54 billion capital, totaling N114 billion.
On the other hand, Akwa Ibom’s capital vote of N303 billion is four times higher than its recurrent spending of N74 billion; while Kebbi’s capital vote of N100 billion is three times bigger than its recurrent estimate of N31 billion.
Some states have earmarked capital expenditure figures almost doubling their recurrent namely, Kano, Borno and Katsina.
The remaining states have capital expenditure just slightly higher than their recurrent spending.
Source: Daily Trust.
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