KATSINA STATE: RICH GOVERNMENT, POOR PEOPLE! At the end of its nationwide survey in 2012, the National Bureau of Statistics (NBS) listed Katsina State people as the second poorest people in Nigeria ( nigerianstat.gov.ng/). Looking at the state’s budget for the 2013 fiscal year, which was dubbed the ‘budget of responsibility,’ one can’t help but wonder whether or not the government is really demonstrating responsibility. Are things are going to get any better for the poor people of my beloved state? Or, are we heading for the number one position of the poorest people in the country? The collective economic prosperity of any group of people depends largely on a good budget and how well that budget is implemented. That’s why, in this piece, I’ve looked at Katsina State budget for 2012 to identify possible reasons why we did so poorly in that year and compared it with that of 2013 to forecast if anything is going to change for the common man. Poverty amidst plenty In 2012, for its almost 7 million people, Katsina State government received around 100 billion naira from Federal Allocation, the 7th largest amount received by any state in the country. The only states that received more federal allocation than Katsina were Akwa Ibom, Bayelsa, Delta, Kano, Lagos, and Rivers States (You can verify this at: economicconfidential.net/ new/2013/rich&poor.html). Nevertheless, Katsina State was ranked to have the 2nd poorest people in the nation with up to 75% of its people living with below 1 dollar per day; second only to Sokoto State. This is also despite the billions of our internally generated revenue (exact figures are hard to come by because of paucity of reliable information on these funds although the 2013 budget is based on the expectation of at least 14.5 billion naira to be internally generated). For any person with a sense of reason, this is abject poverty amidst plenty of both human and capital resources. What a paradox?! Why is this so? Why are we among the poorest people in the country notwithstanding these huge sums of money supposedly coming into the state treasury? A quick glance at the state’s budget for 2012 reveals a truck load of clues. In that year (2012), nearly 119 billion was budgeted, out of which over 70% went to capital expenditure and less than 30% was budgeted for recurrent expenditure. The government claimed 73% budget implementation in 2012. You may ask ‘What’s wrong with these figures?’ Well, I’m afraid, everything is. For starters, according to reliable figures sourced from the State House of Assembly only 37% of the budgeted funds were actually released, and not 73% as claimed by the government. Moreover, the fact that only 30% of our budget in 2012 went to provision of essential services such as education (the backbone of all development), healthcare delivery, water supply and agriculture (the number one employer of people in the state) to mention but a few, means that the quality and reach of these vital services were limited and, therefore, would do little to help the overall economic prosperity of the people. Any hope of improvement in 2013? To be candid, I’m not quite optimistic about 2013 either, because its budget is very similar to that of 2012 in many ways. First, the sum of 114.5 billion naira, an amount similar to that of 2012, was budgeted. This demonstrates our inability to seek out more and better ways to improve on our capacity to generate internal revenue. Second, while capital expenditure gets as high as 73% in 2013, recurrent expenditure accounts for only 27% of the budget. Just like in the 2012 budget, capital projects dominate this year’s budget. For example, construction of roads alone has been reportedly allocated as high as 20% of the budget, while vital sectors like health, education and agriculture only get abysmal percentages, far too small to make any meaningful impact on the population. Apart from these worrisome similarities, I have one more issue with the state’s budget for 2013. During the presentation of the budget to the State House of Assembly, Gov. Shema mentioned that, out of the 114.5 billion naira budgeted for this year, 74.5 billion naira was expected to come from Federal Government Statutory Allocation, while internally- generated revenue, capital receipts and the opening balance would together produce the remaining 40 billion naira. One intriguing question that bugs my mind is why the state government made a budget based on the assumption that only 74.5 billion naira would come from the Federal Allocation when we received almost 100 billion in 2012? Is oil price expected to come down this year? Is Nigeria expecting a decrease in its oil production? Is the revenue allocation formula going to be changed this year? Or, are we simply underestimating our projected income? Who is going to get the remaining balance? Frankly, I’m confused! I don’t want to sound cynical but, to be honest, after critically looking at the major items in the 2013 budget for Katsina State, I can assert with a high degree of confidence that, if the NBS is to conduct another survey this year, we will beat Sokoto hands down in taking the first position in poverty (unless, of course, if poverty in Sokoto State gets worse). If our 2013 budget is anything to base a judgement on, we are heading for that first position – the poorest people in Nigeria (“Wa iyazu billah”). Sycophants of and those close to the state government may question my good intention for writing this article. I wouldn’t blame them for their scepticism provided they are not blinded to facts on ground (some of which I’ve mentioned above) and the reality of the embarrassment the 1st position in poverty could cause all of us, which is much more painful than the nationwide mockery that the 2nd position is already causing us. My hope is that this piece will wake us all up to the obvious slumber that has seemed to grip us, and that the people in government will take action to circumvent this appalling and unenviable situation. Way forward To avoid the iniquitous 1st position in poverty we must admit our past mistakes and learn from them. Striking a balance between capital and recurrent expenditures based on people’s needs is the gold standard in budgeting that no economist in his right senses can disagree with. Capital expenditure should only take precedence over recurrent expenditure where essential services (such as health, education, etc) have been stabilised at the required quality and reach. Luckily, to come up with a solution to poverty in our state, we need not re-invent the wheel. We can learn from the remarkable performance of some Northern states with low internally generated revenue, but yet had low poverty level compared to other states. For example, Niger State had an impressive performance in 2012 and went home with the envious title of the state with the lowest poverty in the country – less than 34 percent of its people lived below poverty line according to the NBS survey conducted in 2012 compared to Katsina State‘s 75 percent. How did they do it? Again, in the budget lie clues. I painstakingly studied Niger State’s annual budgets and what I found was astonishing. It was a direct contrast of our budget. Over the past years, Niger State has consistently allocated between 45% and 55% of its budget to recurrent expenditure. This ensured better provision of quality services essential for poverty alleviation such as education, healthcare delivery, water supply and agriculture. Furthermore, Niger State, in conjunction with its LGAs, has initiated grassroots projects executed through Ward Development Committees (WDC), one for each ward. Every month, each of the 274 WDC in the state is given N1 million to execute projects in their wards. The type of project executed by each WDC is determined based on the needs and yearnings of the people in the wards, thereby continuously creating economic empowerment opportunities for their people at grassroots level. We may not necessarily need to copy verbatim what other states are doing, but, in my humble opinion, we need to critically look at what they are doing in order to come up with people oriented projects that best suit our state. These types of projects are crucial in Katsina State if we are to avoid the dreadful 1st position in poverty. Certainly, ‘blowing’ over 70% of our income on capital projects that have no direct impact on the majority of the population and only benefit a few contractors and people in government is never going to rid us of the bitter taste of poverty. And, by the way, which responsible government spends 2.1 billion naira on miscellaneous items when only 1.8 billion is spent on health, as Katsina State did in 2012? Even die-hard government fanatics will agree that this is surely not a responsible way of spending public funds. Therefore, let’s be a little bit more responsible. Let’s lead Nigeria in something else, something positive. But, please, not in poverty! I wish the state government takes the issue of poverty more seriously so I can someday write an article with the title, “Katsina State: rich government, RICH people.” The author of this article, Dr. M. Aminu, writes from Liverpool (UK) and can be reached at: drmahey@yahoo
Posted on: Sun, 09 Jun 2013 21:25:49 +0000