On Tuesday, 26th November 2024, the Akwa Ibom state governor, Pastor Umo Eno presented the 2025 fiscal year budget estimates of N955 billion to the Akwa Ibom State House of Assembly.
The budget size is made up of N300billion recurrent expenditure and a capital expenditure of N655 billion.
According to the governor, projected revenue estimates from internally generated revenue (IGR) is N80 billion. Statutory revenue N20 billion, derivation revenue N135 billion. 13% derivation revenue arrears N60 billion, exchange gain, augmentation and others, N455 billion, excess crude N5 billion, Value Added Tax (VAT) N70 billion, ecological fund N5 billion.
The above are the various sources of revenue to fund the 2025 budget. And it was predicated on N75.00 per barrel at a production rate of 2.12 million barrel per day with an estimated exchange rate of N1, 400/USS.
Pegging exchange rate at N1,400/USS is unrealistic. As at today, the official exchange rate is N1, 708.91000 to a dollar. The 2025 estimated budget is therefore built to have deficit and under perform.
Moreover, despite reports suggesting that Nigeria’s crude oil output, including condensate, rose to 1.8 million barrel per day (mbpd) in October 2024, official data from the National Upstream Petroleum Regulatory Commission (NUPRC) indicates otherwise. According to the NUPRC, crude oil production, including condensate, fell slightly by 0.40% in October, averaging 1,538 mbpc compared to 1,544 Mbps in September. However, when excluding condensate, crude oil production increased marginally by 9,029 barrels per day, rising from 1,32 mbpds in October. Obviously, Nigeria’s oil sector continues to grapple with significant challenges, howbeit, how did the Akwa Ibom state government arrive at 2.12 million barrels per day?
Government officials need to research deeper to give a true and realistic data and not produce a budget predicated on guess work. This questions the altruistic intent of the budget. Can we therefore assume that the 2025 budget was crafted with the aim of surmounting developmental challenges? But this will be hard to sell due to the differential variables highlighted above.
The 2025 budget was christened Budget of Consolidation and Expansion, unfortunately, the budget is perceived in the media space to be tailored towards consolidating and expanding the elites.
The media questioned the rationale behind N14.7 billion budgetary estimates for renovations and vehicle purchase. Places to be renovated are; Governor and Deputy Governor’s lodges, the Governor’s office annex and vehicles to be purchased will be for state assembly members.
Meanwhile, there are more pressing issues in health, education, security and agriculture that desperately need funding. But it appears government continues to make budgetary estimates to nurture the greed or comfort of the privileged few.
Often we see government prioritizing frivolities over genuine needs. For instance, the governor recently gave youths in the state money, while schools in the hinterlands are in dire need of desk and chairs. The money given to youths which was in hundreds of millions would have taken care by a hundred million naira? But we rather choose to spend such monies on frivolities.
Money, especially when it is scarce, should be given a direction for meaningful impact. It is rather sad to hear civil servants in Ministries, Departments and Agencies complain over lack of funds. Hence, they struggle financially while waiting for the release of budgeted funds. Consequently, issues that should have been resolved remain, and these will eventually find their ways back to the budget year after year. We cannot continue to have the same items repeated in the budget year after year without treating the issues; it does not make financial sense and questions the integrity of the budget.
The third quarter report of 2024 budget performance presented to journalists in October was put at 26.9 per cent. The budget performance could be better if we follow up funds that are released. This will ensure that they are not diverted to other perceived priorities. We must be seen to follow through the budget as stipulated. This will ensure the integrity of the budget.
Governance, we know, is not an easy task, especially when there are loads of issues chasing scarce resources. We must therefore channel the limited resources to areas that are for the good of all, while doing away with needless jamborees that government often engage in.
