Delta State in the south-south recorded the best budget implementation performance in the South-South region. By the end of the third quarter of 2022, the state has implemented 131.65 per cent of its pro rata budget for the period. Delta State spent N472.89 billion of its N359.21 billion budget for the first three quarters.
In comparison, by the end of the third quarter, Bayelsa State spent N210.23 billion of its N235.85 billion. This represents 89.14 per cent budget implementation performance as of Q3 2022.
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Cross River State spent just 22.24 per cent of its budget for the first three quarters of the year. The state spent N39.41 billion out of N177.25 it earmarked to be spent.
Edo State’s budget implementation report (BIR) for the first two quarters of 2022 shows that the state had a 86.18 per cent performance. The state spent N95.91 billion out of a pro-rata budget of N111.29 billion for the period.
Rivers State spent 65.74 per cent of its budget for the first quarter of 2022. Based on the available BIR as of Q1 2022, the state spent N75.56 billion of N114.92 billion for the period.
South-South’s Regional Budget Appropriation
Five state BIR reports were reviewed from the six states in the region. These states had a budget of N1.83 trillion for the year. The budget appropriated to Bayelsa State was N314.47 billion. Cross River State had a budget of N354.51 billion, in Delta State, it was N478.94 billion. Edo and Rivers states had a budget of N222.57 billion and N459.67 billion, respectively.
An analysis of the BIR shows that Bayelsa, Cross River, and Delta states had a budget of N772.31 billion for the first three quarters of 2022. By the end of the period, they spent N722.53 billion, a 93.56 per cent performance.
A review of the five states’ budgets shows that N1.22 trillion was expected as revenue, giving a deficit of N611.31 billion for the year
Revenue generation analysis shows that Bayelsa, Cross River, and Delta states generated a combined revenue of N627.56 billion from the Q3 pro rata N502.06 billion. This shows a 124.9 per cent revenue performance for the states by the end of Q3.
In Edo State, N61.14 billion was generated out of the N70.66 billion intended to be generated by the end of Q2 2022. The state had an 86.53 per cent performance in the process. Rivers State recorded an 88.87 per cent performance, generating N83.89 billion of its N94.4 billion Q1 revenue.
Federation Account Revenue vs. Internal Generated Revenue (IGR)
Bayelsa, Cross River, and Delta states had a revenue projection of N502.06 for the first three quarters of 2022. A breakdown of the project shows that N412.72 billion is expected from the federation account revenue, accounting for N82.2 per cent, with N89.34 billion to be generated internally.
Edo State had a Q3 pro-rata revenue projection of N70.66 billion. This comprises N45.35 from the federation account revenue and N25.3 from internal sources. Thus, federal collectible revenue accounts for 64.19 per cent of its revenue.
Federal collectible revenue took 60,48 per cent in Rivers State. The state’s Q1 pro-rata budget is N94.39 billion – N57.09 from the federation account revenue and N37.31 from internal sources.
Bayelsa State had the highest proportion of its approved revenue to be generated from the federation account. The state intended to receive N167.99 billion from the federation account revenue, 91.80 per cent of its total revenue of N182.99 billion.
Cross River’s 68.68 per cent of its N45.79 billion approved revenue was to be generated from the allocation from the federation account.
That of the other states shows that 78.04 per cent was to be generated from the federation account in Delta State, 64.19 per cent in Edo State, and 60.48 per cent in Rivers State.
Across the region, only Rivers State generated more than its projected IGR. The state earmarked N37.31 billion as revenue from IGR (figure for the first quarter of 2022) and generated N40.41 billion, representing 108.32 per cent.
However, other states in the region performed between 62 per cent to 65 per cent, except Delta State, which generated 93.09 per cent of its IGR. Delta State planned to generate N60 billion by the end of Q3 and generated N55.86 billion.
The states in this region’s planned revenue compositions show that IGR had less than 40 per cent of the expected revenue. For instance, Bayelsa State planned to generate 8.19 per cent of its total revenue for the period internally. Cross River had a 31.32 per cent IGR composition of its budgeted revenue.
It is 21.96 per cent in Delta State, 35.81 per cent in Edo State, and 39.52 per cent in Rivers State.
However, the performance of its revenue component shows that only Rivers State had its IGR taking 48 per cent of its total revenue. Edo State’s IGR formed 27 per cent of its revenue performance, while it was 21 per cent in Cross River State. Delta and Bayelsa states had a 15 per cent and 4 per cent IGR composition performance for the period.
Revenue analysis for the region shows that the states in the region had a better performance for the revenue from the federation account as against that generated internally. This is due to the 13 per cent derivation fund paid to the state from the federation account.
Recurrent vs. Capital
Capital revenue took 58.1 per cent of the total approved N998.51 billion, as N580.1 billion was budgeted for capital items in the states within the South-South region. Recurrent expenditure stood at N418.41 billion, 41.9 per cent of the total revenue.
The state’s budget composition varies based on the amount budgeted for capital and recurrent expenditures.
Rivers State had the highest capital expenditure proportion, as 69 per cent of its N114.92 billion was budgeted for capital items. It was 64 per cent in Cross River State and 61 per cent in Delta State.
In Edo State, 58 per cent of its N111.28 billion budget was to be spent on capital expenditure, and 45 per cent of the N235.85 billion total expenditure to capital expenditure in Bayelsa State.
By the end of the third quarter of 2022, N894 billion has been spent by the states in the region. The states spent N515.42 on recurrent expenditure and N378.58 billion on capital expenditure. This shows that 57.65 per cent of the total expenditure was spent on recurrent expenditure and 42.35 per cent on capital expenditure.
The individual state’s performance shows that only Rivers and Edo states spent over 50 per cent of their expenditure on capital items. In Rivers State, the administration approved the release of 61 per cent of N75.56 billion on capital projects approved in the state’s budget for the 2022 fiscal year. Edo State spent 51 per cent of its N95.91 billion total expenditure on capital items.
Delta State spent 40 per cent of its total expenditure by the end of the third quarter on capital expenditure. Bayelsa State spent 39 per cent of its budget on capital expenditure..
Cross River State spent the sum of N39.42 billion by the end of the second quarter as a total expenditure. Within this period, 27 per cent of the amount spent was on capital expenditure and 73 per cent on recurrent expenditure.