A WikkiTimes review of budget performance documents across states in North Central Nigeria has shown how public debt transactions fared alongside Internally Generated Revenue (IGR) in the respective states.
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Review shows that while Kogi state made the sum of N23.6 billion as IGR, the public debt charges figure for the year stood at N17.6 billion. This would mean that the state spent an equivalent of 73% of its revenue on public debt charges.
For Niger state, the sum of N18.07 billion was made as IGR while public debt charges gulped N14.58 billion. This also means that eighty percent of the money that the state recorded as internally generated revenue was spent on debt charges.
WIKKIDATA: Regional Representation of Northern States Debt in Three Charts
Kwara state internally generated revenue for the year stood at N54.9 billion while the sum of N12.7 billion was recorded for public debt charges. In Kwara 22% of the state’s IGR was spent on debt servicing.
In Nasarawa, N24.9 billion was posted as the internally generated revenue of the state , however N5.247 billion was paid out for public debt charges.
This would mean that Nasarawa spent an equivalent of 20.8% of its revenue on public debt charges.
While Plateau posted the sum of N23.6 billion as internally generated revenue, it spent N51.3 billion as public debt charges for the year.
Plateau spent over two times of its IGR on debt transactions.
The revenue challenge
There has been concerns about how states have high debt profiles, WikkiTimes earlier reported how the state stands in terms of indebtedness.
Experts have noted that states should diversify their sources of income to ensure that they rely less on debts.
WikkiTimes earlier reported that Banks have also been feeding states with funding.
For Access Bank, as of half year 2022, the loan to the government stood at N415 billion , representing 7.7% of the total loan it issued out for that period of time.
As of the half year of 2023, the loans disbursed by Zenith bank to the government stood at N731 billion, representing 13.6% of the total loan by the bank as of that period.
Government took 10.2% of the loan disbursed by the United bank for Africa as of half year 2023, with a total N470 billion.
Fiscal mismanagement has also been blamed for the debt profile of states .
In 2023, SERAP asked the World Bank to suspend loans to Nigerian states citing diversion of funds and how the monies gotten as loans by these states are spent.
While it has been noted that the Nigerian fiscal responsibility act permits loans for capital needs, reports have it that Nigerian states borrow to pay salaries.
States have struggled with revenue generation , relying on loans to fund their budget.
