Daud Olatunji
A revealing report has surfaced, indicating that 32 out of Nigeria’s 36 states heavily rely on federal allocations to sustain their operations.
This data, highlighted in the “State of States 2023” report by BudgIT, underscores the persistent fiscal dependency of the majority of Nigerian states on federal transfers.
Nigeria has 36 states and the Federal Capital Territory, Abuja.
According to PLATFORM TIMES, the BudgIT report disclosed that 16 of these 32 states depend on the Federal Accounts Allocation Committee (FAAC) for at least 70% of their total revenue.
Despite a notable increase in Internally Generated Revenue (IGR) across many states, the reliance on federal funds remains substantial, with federal allocations constituting 50% of the total revenue for these 32 states.
The heavy dependence on federal transfers highlights the critical need for states to diversify their revenue streams to achieve sustainable fiscal health.
BudgIT’s analysis points to the necessity for states to develop robust local revenue generation mechanisms to reduce this dependency and ensure more stable economic management.
Despite the reliance on federal allocations, the “State of States 2023” report indicates positive trends in revenue growth among the states.
The total revenue across the states grew by 28.95%, from N5.12 trillion in 2021 to N6.6 trillion in 2022.
This growth reflects an upswing in economic activities and improvements in financial management practices.
Internally Generated Revenue (IGR) saw a significant increase, rising by 12.98% from N1.61 trillion in 2021 to N1.82 trillion in 2022.
This improvement highlights the efforts of states to enhance their local revenue generation capabilities, marking a step towards greater fiscal autonomy.
The report also sheds light on significant disparities in education spending across states.
On a per capita basis, 24 states spent below the national average of N4,499.48 in 2022, while only 12 states exceeded the average, spending above N2,200 per capita on education.
This disparity underscores the varying priorities and financial capabilities among states in their investment in educational development.
BudgIT’s “State of States 2023” report is part of a broader initiative to promote transparency and accountability in public finance.
By providing a thorough analysis of the fiscal decisions and economic performance of Nigeria’s states, the report aims to inform citizens about the management and utilization of their taxes.
This transparency is crucial for fostering informed public discourse and encouraging responsible governance.
The “State of States 2023” report by BudgIT reveals the critical fiscal challenges facing Nigerian states, with a pronounced dependence on federal allocations.
While there are positive trends in revenue growth and efforts towards improving IGR, the disparities in education spending and the overall dependency highlight the need for strategic economic planning and diversification.
Ensuring sustainable fiscal health requires states to develop independent revenue sources and invest wisely in key sectors like education to support long-term development and stability.
Do you want to share a story with us? Do you want to advertise with us? Do you need publicity for a product, service, or event? Contact us on WhatsApp +2348183319097 Email: platformtimes@gmail.com
