Niger State’s 2025 budget proposal of N1.56 trillion has sparked concerns due to historical low execution rates and heavy reliance on federal allocations. The state has struggled with internal revenue generation, achieving only 40.29% execution in 2023 and 30.42% in 2024. Experts emphasize the need for revenue diversification to ensure budget feasibility and reduce vulnerability to economic changes.
Niger State faces scrutiny over its proposed 2025 budget of N1.56 trillion, especially given its history of low budget execution and dependency on federal allocations. Critics question whether such an ambitious budget is realistic, noting the state’s chronic underperformance in revenue generation and foreign investments.
Recent financial reviews highlight a persistent gap between projected and actual executions. In 2023, budget figures shifted from ₦243.6 billion to ₦473.95 billion, but only 40.29% was executed. The 2024 budget was similarly increased to ₦829.43 billion, but the third-quarter execution was only 30.42%, raising alarms about the 2025 projections’ feasibility.
Niger State has struggled to enhance its internally generated revenue, with earnings fluctuating between N5.7 billion and N21.6 billion from 2014 to 2023. Though revenues slowly increased, including a notable rise to NGN 21.6 billion in 2023, ongoing reliance on federal allocations remains a concern, with N544.54 billion obtained from the Federation Account Allocation Committee (FAAC) since 2015.
The state’s foreign direct investment (FDI) inflow has been erratic, totaling only $17.92 million between 2019 and 2024, with substantial drops in several years. The projected N140 billion revenue for 2024 falls short of funding its revised budget, leaving uncertainty about where the additional N1.4 trillion for 2025 will come from, even with optimistic forecasts for increases in both FAAC and IGR.
Past patterns reveal the state’s recurring difficulty in meeting budgetary targets. In 2023 and 2024, execution rates were markedly low, comparing similarly to previous years. This trend raises questions about the state’s fiscal management and planning strategies, particularly in reliance on external funding sources.
Financial journalist Harrison Edeh expresses deep concern about the ambitious nature of Niger State’s budget, primarily dependent on federal oil allocations. He cautions that fluctuations in oil prices and Nigeria’s OPEC commitments could severely challenge the state’s budget stability without increased internal revenue generation.
Edeh advocates for the state to leverage its mineral and agricultural potentials to reduce federal dependency. He notes that Niger State has extensive arable land, presenting significant opportunities for agribusiness development, which could substantially enhance the economy and ensure more sustainable revenue streams for future budgets.
Niger State’s proposed budget for 2025 raises serious concerns due to its ambitious nature, heavy reliance on federal allocations, and a poor track record of budget execution. Experts stress the urgent need for the state to diversify its revenue sources, particularly through agriculture and local industries, to create a stable fiscal foundation. Failure to strengthen internal revenue generation could leave the state vulnerable to economic fluctuations and jeopardize future budgetary targets.
Original Source: www.icirnigeria.org
