DID YOU KNOW THAT?

• The Akwa Ibom State Government House proposed 2021 Budget is more than the entire education sector?

Mindful that the Akwa Ibom State proposed 2021 budget is christened “Budget of Economic Reconstruction”, we observed that some of the top capital votes in this budget are addressed to expenditure items that are wasteful, repetitive, vague, unaligned with government’s stated priorities, and unresponsive to the real needs of citizens. They can destroy our future!

These include the proposed:

• N2 Billion for the 21-Storey Smart Building in the Ministry of Special Duties.

• N44 billion for “Accrued expenses” in the Office of the Accountant General - It is disturbing that “accrued expenses” has become a recurring decimal in the budget each year, with actual spending of N34 billion on this item in 2019, the equivalent of actual IGR for the same year. The implication of this is that all the IGR raised in one year by the entire state was possibly consumed by a single MDA on a frivolous and curiously named expense.

• N2 billion in the Office of the Secretary to the State Government (SSG) for servicing of the state’s aircraft

• N4.8 billion for purchase of vehicles in the Office of the SSG, including N800m for 5 security jeeps. Curiously, N738m was approved for 15 Toyota Prado Jeeps but they were eventually purchased at a cost of N4.486bn. Purchase of automobiles has been one of the oldest tricks for funnelling off resources from the public budgets.

• N6.7 billion allocated in the Ministry of Special Duties for a Worship Centre.

Akwa Ibom State is not fiscally sustainable and the budget is dangerously dependent on volatile oil revenues. Without derivation and excess crude payments,, expected inflows from Internally Generated Revenue (IGR), statutory allocations, Value Added Tax (VAT) and retained revenue from parastatals (which stand at N115 billion) cannot address the state’s recurrent expenditure outlay of N208.7 billion for 2021.

Actual recurrent revenues (excluding derivation and excess crude payments) for 2019 was N90 billion compared to N123.2 billion actual recurrent spending target. Therefore, in the event of any shocks in expected oil receipts at the national level, we may need to borrow to pay salaries and run the government bureaucracy.

This is even more alarming considering the apparent reluctance of the government to reduce the cost of governance, particularly overhead spending, proposed at N101.9 billion for 2021 in which case the proposed 2021 budget has a deficit of N60.18bn which the government proposes to finance through internal and external loans of N40.04bn and of N20.14bn respectively.

Citizens Accountability Platform (CAP) Communiqué on AKS 2021 Proposed Budget