The defence budget has come under scrutiny over the last few years, especially as the state of insecurity in the country has continued to worsen. Banditry, kidnappings and sectoral violence combined with the decade-long war against Boko Haram has put the country on the map as an extreme travel security risk.
The level of insecurity continues to increase despite a consistent increase in budgetary allocation to the Ministry of Defence. The ministry has consistently received far higher budgetary allocations than health and education and Nigeria’s military expenditure is one of the highest in Africa.
The question remains, what exactly does the ministry do with its budgetary allocation?
Persistent decline in Ministry of Defence’s Budgeted Capital Expenditure
In 2016, out of the total defence budget of N443.0 billion, N130.8 billion naira was earmarked for capital expenditure in the ministry of defence, representing 29.5% of the total budget. In contrast, recurrent expenditure got the lion share of N312.2 billion, representing 70.5% of the total budget for the Ministry.
Although the budgetary allocation for capital expenditure by the defence ministry increased by 0.5% at N140 billion out of the total budget of N465.4 billion the total ministry budget in 2017, again the scales were tilted heavily in favour of recurrent expenditure with N325.4 billion allocated.
The heavy imbalance between the ministry of defence’s recurrent and capital expenditure has remained consistent. In 2018, 27.2% totalling N157.71 billion was allocated to capital expenditure against the recurrent expenditure which stood at N418.6 billion. The year 2019 saw the budget for capital expenditure by the Ministry drop to 26.9% of total budget allocation representing N159.1 billion out of the total budget of N589.9 billion, the recurrent expenditure for the year was N430.8 billion.
Notably in 2020, in the heat of rising insecurity across all geopolitical zones of the country and the global pandemic, the capital expenditure as captured in the Ministry of Defence’s budget dropped to 12% with a mere N116 billion allotted out of the N900 billion total defence allocation. This means that a total of N784.6 billion was budgeted for recurrent expenditure in 2020, representing 88% of the total budget.
There was a slight increase in the ministry’s capital expenditure budget, which moved up by 1.2% to 13.2 % in 2021. The 2021 budgeted capital expenditure of the ministry stood at N127.8 billion from the total budget of N900.4 billion. Despite this increase, the recurrent expenditure still took a chunk of N772.6 billion, this is 86.8 % of the total ministry’s budget for 2021.
In the last six years, although budgetary allocation to the Ministry of Defence has seen a steady rise, budgeted capital expenditure of the ministry stood at N831.4 Billion representing 23.1% of total budget allocation to the ministry within this period.
Why is the skewed balance of capital vs recurrent expenditure worrying?
Recurrent expenditures are used to take care of wages, salaries, goods and services, while in some cases for depreciation while capital expenditures are used for acquiring fixed assets such as equipment and in this case military hardware.
Although it is understandable that recurrent expenditures can be larger than capital due to the size of the workforce in a ministry like defence, not only are these differences very high, there is also a consistent decrease in allocation to capital expenditure over the years.
With huge amounts of the budget allocated to celebrations captured under recurrent expenditure while the poor state of manpower within ministries under the auspices of Defence is well known and documented and the need for modern equipment to fight insurgency has been echoed in different quarters, it appears that the ministry may need to reprioritize its spendings.
How Does Nigeria’s Defence Ministry Budgeting Compare With Other Countries
West African country Ghana, has 9.2% (193.92 GHS) of its total 2021 defence budget (GHS2.12 trillion ) allocated to capital expenditure. In Kenya, of the Defence Ministry’s KES 115.48 billion budget, our analysis showed that KES9.2 billion (8.6%) went to Development (Capital) expenditure while KES106.2 billion went to recurrent expenditure.
Kenya is 23rd on the list of most terrorised countries in the world, 20 places above Nigeria. In South Africa, the 2021 defence budget is put at R46.2 billion while salaries will take R29 billion(63%), leaving 37% for operations and capital expenditures.
Ghana and Kenya appear to budget less than Nigeria for capital expenditure within their defence budget while South Africa’s capital expenditure budget is higher than Nigeria’s own. It is important to note that of these three countries in comparison to Nigeria, Nigeria has a far higher population and landmass figures, 206.1 million and 923,768 Km respectively.
In addition to Nigeria’s high population and land area, Nigeria outranks all three countries on the global terrorism index produced by Institute for Economics and Peace. Nigeria is 3rd most terrorised country in the world while Kenya places 23rd on the list, followed by South Africa ranked 41st and then Ghana ranked 82nd.
Both indices of population and state of insecurity make it imperative for Nigeria, already budgeting far higher than most African countries, to be more strategic in its budgetary spendings.
When compared with top-ranked militaries of the world like the USA and Canada, it is understandable why these countries’ militaries are top-ranked. A Dataphyte analysis of the 2021 United States of America’s defence budget shows that of the $705.4 billion department of the defence budget, $200.5 billion(28%) was budgeted for the acquisition of military hardware. This is apart from other capital expenditures of the country for its defence budget.
The 2021 Canadian defence budget shows that the country’s defence ministry got $23.3 billion in total. Of the amount, $5.1 billion (21.8%) went to capital expenditure. Personnel and Operating expenditure which makes up recurrent expenditure got 37% and 33% respectively, totalling 70%.
Nigeria outranks both countries on the global terrorism index (USA 29th, Canada 50th). The nature of the budgetary allocations to the defence of countries like this may provide a template for Nigeria’s defence budgeting. So that defence mechanism are strengthened to preserve the sovereignty of the nation and bring the country back from the brink of utter chaos.
Dire Implications of Insufficient Capital Investments
What is the resultant effect of a lack of adequate investment in military assets and infrastructure? Rise in insecurity, as it is unfolding in all 6 geopolitical zones of Nigeria. Acts of insurgency and terrorism are on the rise, as well as banditry as well as increasingly violent sectoral agitations. While lack of equipment does not directly lead to insecurity, it can exacerbate it as actions to curb insecurity can be hampered by a lack of necessary tools.
According to data published by the council for foreign relations (CFR), Nigeria has had increased deaths perpetrated by non-state actors such as Boko haram and sectarian actors.
The data noted that Nigeria recorded a cumulative death of 13,936 persons from Boko Haram as of December 2016, increasing to 14,940 as of December 2017.
The death rate has increased consistently yearly and as of October 2021, the cumulative deaths by Boko Haram stands at 18,395 according to CFR.
Nigeria has had other deaths from sectarian actors recorded in the past six years. The country continues to suffer from banditry and an increased spate of kidnapping.
Unsurprisingly, this increase in insecurity has been linked to a lack of equipment among other factors.
Beyond Equipment, A Bigger Danger May Be Lurking
Already, Nigeria does not have enough money to fund its budget. A Dataphyte report revealed that 38% of the country’s 16 trillion 2022 budget will be borrowed. It may mean the security sector may not be able to get more of the nation’s budget in future than it is getting now. The country may be looking for ways to reduce borrowing and as such funding security will suffer as much as other critical infrastructure demands.
In an instance, according to a military machine website, it cost $ 250,000 to buy an M4 Sherman tank (cheapest on the list). This would mean if Nigeria were to buy 20 tanks, it would cost 5million dollars. At the exchange rate of naira to the dollar as of 2019 (400 naira to a dollar), it would mean the Nigerian Army would have used 10.5% of its 19 billion 2019 capital budget to buy 20 tanks.
If the naira continues in its current trajectory, then the Ministry of Defence will be getting even less for the value of its already low capital allocation. The implication of this is that Nigeria’s capacity to wage war against insecurity is further weakened.
Expert Proffer Ways Of Improving Nigeria’s Security
Commenting on the development, a public affairs commentator, Abdulmaliq Mopelola, stated that there is a need to rightsize the workforce and block duplicity of functions to ensure that more money is freed to allow an increase in capital expenditure.
While noting that there is a need to ensure that gaps in other sectors of the country are blocked to allow more funding of capital expenditure, she warned that corruption that has been mitigated against the defence sector needs to be avoided.
Modupe also noted that if Nigeria is serious in the fight against insecurity, it must be ready to spend money on asset acquisition and military hardware, rather than recurrent expenses.
A policy expert, Samuel Atiku noted that there is a need for the national assembly to step up its oversight functions. He noted that despite the high recurrent expenditure, there is still an issue of welfare of military personnel, where many persons in the military have poor housing and other issues around their welfare. This according to him leaves the question of how the monies are spent.
Samuel stated that the recurrent expenditures have not been explicitly explained and other critical security agencies have the same pattern.
He noted that the way forward to curb this pattern is for the national assembly to pay critical attention to defence spending.