Winning the March 11, 2023 election may be the easiest part for governors-elect in 30 of Nigeria’s 36 states.
The bigger task will be fixing the finances of their states which are currently in a precarious state.
Thirty state governors who are leaving office on May 29 or seeking re-election have increased their states’ debts to N4.8 trillion, according to gleaned from the Debt Management Office (DMO) shows.
BusinessDay’s findings showed 27 state governors, including the minister of the Federal Capital Territory (FCT) are leaving office on May 29 or running for re-election, while Kogi, Imo and Bayelsa states would be conducted on November 11, 2023.
Election will not be held in Ekiti, Ondo, Edo, Anambra, and Osun states, where governorship elections have fallen off-season.
Amid declining allocations from the Federation Account as well as meagre internally generated revenue in many of the states, checks by BusinessDay showed some state governors increased their debt profile in Q3 2022 despite having a few months to the end of their administration.
DMO’s data show that FCT recorded an increase of 49.3 percent from N75 bn to N112 bn. It is followed by Niger State with a 21 percent increase to N98 bn from N80.9 bn.
Other states whose debts are of concern are Ebonyi and Gombe. Ebonyi recorded an increase of 13.5 percent from N59bn to N67bn while Gombe also recorded a 16.6 percent increase from N 123.6bn to N144.2bn.
“The problem of low revenue at the state government level has been a perennial one and that is due to their over-reliance on monthly allocations from the Federal Government in running the states,” said Gabriel Mfon, the programme officer at Policy Alert, a non-governmental organisation promoting citizenship for development.
The fifth state with the highest increase in debt is Bauchi. The state recorded a 11.6 percent increase to N144bn from N129 bn. Kaduna also recorded a 10.2 percent increase from N78bn to N86bn.
Lagos State recorded a 10 percent increase from N797bn to N877 bn; Akwa Ibom recorded .f percent from N203.9 bn to N219.6bn; Plateau recorded 0.05 percent increase from N144.6bn to N151.9bn.
Other states include Adamawa (N122bn); Oyo (N160 bn); Imo (N210bn); Bayelsa (N151bn); Ogun (N241 bn); Rivers (N225bn); Kano (N125 bn); Taraba (N90.8bn); Enugu (N89.8bn); Benue (N143.3bn); Kogi (N90.1bn); Nasarawa (N72.6bn); Kebbi (N60.1 bn); Cross River (N175.1 bn); Kwara (N109.5 bn); Jigawa (N44.4bn); Abia (N104.5bn); Yobe (N92.8bn); Sokoto (N85.5bn); Zamfara (N109.6bn); Borno (N96.3bn); Katsina (N62.3bn) and Delta (N272.6bn).
Analysts say the incoming governors in these states have to look inward and deploy other means to grow their revenue base while cutting down on their huge borrowing appetite.
“Newly elected governors would be confronted with the challenges of how they can fashion out innovative ways of generating revenues to not just meet expenditures required to run the states but to also service what can be regarded as a legacy debt from their predecessors,” Mfon said.
Findings showed that Delta State governor, Ifeanyi Okowa got the state House of Assembly’s approval last January for a N100 billion loan facility, out of the N150 billion earlier approved Consolidated Syndicated Loan.
“The loan would be used for the payment of contractors and funding of an assortment of crucial ongoing projects across the state,” Okowa told the state lawmakers last month.
Apart from Delta, Niger State House of Assembly also granted approval for the state government to obtain a loan of N14 billion to finance some selected projects to completion in the state.
Muda Yusuf, the CEO of Centre for the Promotion of Private Enterprise said its critical for the government to ensure accumulated debt does not outweigh the state’s ability to generate revenue
“States whose debts far outweigh their revenues create problems for the next administration,” Yusuf said.
Out of the 30 states having governorship elections in 2023, BusinessDay’s findings showed that 17 governors will not be seeking re-election in March.
They include Mohammed Bello (FCT); Emannuel Udom (Akwa Ibom); Samuel Ortom (Benue); Ifeanyi Okowa (Delta); David Umahi (Ebonyi); Aminu Masari (Katsina); Bello Bagudu (Kebbi); Abubakar Bello (Niger); Aminu Tambuwal (Sokoto); Simon Lalong (Plateau) and Darius Ishaku of Taraba.
Other governors not seeking re-election include Nasiru El-rufai (Kaduna); Abdullahi Ganduje (Kano); Victor Ikpeazu (Abia); Ifeanyi Ugwuanyi (Enugu); Ben Ayade (Cross Rivers) and Nyesome Wike of Rivers.
The 11 governors expected to seek re-election in March includes Governor Mohammed Yahaya (Gombe); Babagana Zulum (Borno); Abdullahi Sule (Nasarawa); Seyi Makinde (Oyo); Mai Buni (Yobe); Bello Matawalle (Zamfara); Babajide Sanwo-Olu (Lagos); Ahmadu Fintiri (Adamawa); Dapo Abiodun (Ogun); Bala Mohammed (Bauchi) and Abdulrahman Abdulrazak of Kwara State.
“Governors will need financial ingenuity to match revenue shortfall or risk increasing poverty in their states,” Damilola Oguntoye, a risk management expert with one of Nigeria’s biggest consultancy firms said.
Read also: What CBN’s N22.7trn overdraft-to-debt means for economy
The Latest National Bureau of Statistics (NBS) report showed Sokoto, Bayelsa, Jigawa, Kebbi, and Gombe have been ranked as the poorest states in Nigeria based on the Multidimensional Poverty Index (2022) report.
According to NBS, these states are ranked the poorest due to indicators such as nutrition level, food insecurity, time to healthcare, school attendance, years of schooling, school lag, water, water reliability, sanitation, housing materials, cooking fuel, assets, unemployment, underemployment, and security shock.
“In general, the incidence of monetary poverty is lower than the incidence of multidimensional poverty across most states. Abia, Ebonyi, Jigawa, and Sokoto have similar proportions of people identified as poor using both measures, while Taraba and Adamawa have higher levels of monetary poverty,” NBS said.
The report stated that Bayelsa is distinct from the other poorer states in having the largest contribution across all states in unemployment and shocks, adding that “even when comparing Kebbi and Jigawa, which are somewhat more similar, we see a much greater challenge in access to water and greater nutritional deprivations in Kebbi, as well as school lag and underemployment in Jigawa.”
Addressing the poverty challenge varies across the sub-national governments in Nigeria, due in part to the intensity and peculiarity of poverty in each state.
“It will be more expensive to reduce poverty in Zamfara, where the intensity of poverty is higher, at 42 percent, than in Lagos (34 percent), because each poor person in Zamfara, on average, faces more deprivations at the same time,” NBS added.
