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By: Brain Builders Youth Development Initiative
The Kwara State Government has laid out its fiscal plan for 2025, projecting a total expenditure of N540.36 billion with a deficit of N70.45 billion. While the budget includes some positive measures, it also raises significant concerns about transparency, fiscal discipline, and developmental priorities.
Commendable Provisions:
Minimum Wage Adjustments: Demonstrating commitment to workers’ welfare, the budget proposes enhancements to the minimum wage structure.
Sectoral Allocations: Notable increases in funding for education and healthcare, although further improvements are necessary.
Revenue Enhancement: Initiatives to improve internally generated revenue (IGR) aim to decrease reliance on federal allocations.
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Critical Concerns:
Revenue Assumptions and Deficit:
The budget’s reliance on federal allocations (N259.79 billion) and an IGR of N96.23 billion seems unsustainable. The planned borrowing of N70.43 billion could significantly increase the state’s debt.
Recurrent vs. Capital Expenditure:
With N204.71 billion (37% of total budget) going towards recurrent expenditure, there’s a clear imbalance. High personnel and overhead costs suggest inefficiencies, with N69.14 billion for personnel and N107.2 billion for overheads. The Government House allocation of N5.82 billion appears disproportionate.
Underfunding of Key Sectors:
Education funding at N51.53 billion (9.5% of the budget) and health at N43.1 billion do not meet international benchmarks, highlighting poor spending priorities.
Project Costs and Transparency:
Lack of detail in allocations for major projects raises questions about cost efficiency. For instance, N30.57 billion for the Ministry of Works lacks project-specific clarity.
Transparency Issues:
The budget lacks detailed breakdowns for many agencies, reducing public oversight. No clear performance metrics for ongoing projects are provided.
Debt and Servicing:
With N11.78 billion earmarked for debt servicing, the increasing debt level without a sustainability plan is concerning.
Social Services Neglect:
Minimal focus on job creation and social protection, with only N36.17 million allocated to the Ministry of Social Development, despite high unemployment and poverty rates.
Recommendations for the Kwara State House of Assembly:
Fiscal Pruning: Drastically cut down on recurrent expenditure through payroll audits and overhead reductions.
Sectoral Investment: Boost allocations to education and health to align with global standards.
Transparency and Accountability: Ensure public access to detailed budget breakdowns and performance evaluations.
Revenue Strategies: Enhance IGR through better tax systems and economic diversification.
Realistic Budgeting: Avoid over-reliance on loans and grants by setting achievable revenue targets.
Social Focus: Prioritize employment, youth empowerment, and poverty alleviation over administrative costs.
Conclusion:
As the Kwara State House of Assembly considers this budget, the focus should be on creating a framework for sustainable economic growth rather than short-term political gains. This analysis, the first in a series by BBYDI, underscores the need for a budget that is not only responsible and transparent but also geared towards equitable development for all citizens of Kwara State.
Sat Jan 25 , 2025
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