Budget blues: Nigeria shortchanges its future, health with underfunding

…Children out, doctors out, can the giant of Africa afford this neglect?

Nigeria has been underfunding the education and health sectors since 2019, compared to Ghana, Kenya, and South Africa. What is the implication of this, and why should there be changes going forward?

Nigeria’s allocation to the education and health sectors has been below the recommended benchmark for developing nations for years. According to UNESCO, a benchmark of at least 15 to 20 percent of the national budget should be allocated to the educational sector, or 4 percent to 6 percent of the gross domestic product (GDP). The Nigerian government has failed to meet the benchmark year after year.

In 2019, Nigeria’s budget allocated to education amounted to 7.12 percent of the total federal budget. More unimaginably, from 2019 to 2022, the percentage continually dropped to 6.7 percent in 2020, 5.68 percent in 2021, and 5.39 percent in 2022, respectively. Furthermore, despite pledging improved funding in 2023, President Tinubu allocated less than 7 percent of the budget while allocating only 5.98 percent of the 2024 proposed budget of N24.08 trillion to the educational sector.

Nigeria’s budgetary allocation has been significantly lower than Kenya and South Africa, with Kenya consistently exceeding the UNESCO benchmark of 27.4 percent and 26.7 percent in the 2020/21 and 2023/24 budgets, respectively. South Africa also fulfilled its pledge with 19.5 percent in 2019, 18.42 percent, and 19.75 percent in 2021 and 2022, emphasising the education sector. Ghana, however, has slightly below 4 to 6 percent of its GDP.

Nigeria has consistently failed to meet the target of allocating 15 percent of its annual budget to the health sector, even during the COVID-19 pandemic. Despite the challenges, only 5 percent of the 2024 appropriation bill was allocated to the sector, highlighting the need for better allocations in the health sector. This issue is echoed in previous allocations.

Compared to Kenya, South Africa, and Ghana, Kenya’s allocation represented 11 percent of the total annual budget in the 2023–2024 budget. The health expenditure in South Africa is expected to be 8.70 percent of GDP by 2024, while Ghana’s health expenditure is on a similar underfunding pattern to Nigeria’s and is expected to be 4.31 percent of GDP by 2024. It is unsurprising to see Nigeria ranking 87 out of 94 countries on the Global Healthcare Ranking, while South Africa ranks 49 and Kenya ranks 41.

What is the implication of education and healthcare underfunding in Nigeria?

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Underfunding in Nigeria’s education and healthcare sector is causing significant issues for the country’s development and population well-being. With up to 10.2 million children out of school, high unemployment rates and irregular salaries are affecting the sector. The exodus of lecturers to foreign countries has reduced the workforce and quality of research, leading to a reduced workforce and a decrease in research quality. The private sector is also exploiting the available space, increasing inequality and poverty.

Nigeria’s tertiary education institutions have not significantly improved due to underfunding for new lecture rooms, despite the exponential growth in tertiary education. With 1.3 million candidates preparing for entrance exams, only 450,000 available spaces are used. In 2008/2009, only 18.9 percent of applicants were admitted, ranking Nigeria second in Africa sending students overseas.

70 percent of Nigerians pay for healthcare out-of-pocket, limiting access to quality care. This has led to poor health-seeking and poor health indices. Nigerian NHIS enrollees still pay hidden charges, co-payments, and deductibles at the point of care, unlike Ghana where no additional payment is required. The Nigerian health system has performed poorly against vital health indices, trailing many African countries. The Nigerian Association of Resident Doctors has revealed that 1,417 members plan to leave for the UK and the US before the end of 2023.

Why should there be changes going forward?

There is a need for every child to have an equal opportunity to learn, grow, and contribute to building a world that is not only peaceful but also prosperous. To achieve these objectives, we must embrace a deep commitment to strengthening learning outcomes, accelerating skill development, and ensuring that education is a beacon accessible to all, particularly those on the fringes of society. There is a need to increase educational resources, advocate for debt swaps, and enhance spending efficiency, effectiveness, and transparency to ensure that no child is left.

Currently, 10 percent of the population bears 60 percent of the total health expenditure, risking financial hardship to cover health-related issues. This stressed the importance of raising sufficient and sustainable revenues to ensure efficient and equitable access to Universal Health Coverage (UHC). The federal government’s inability to draw lessons from the outbreak of the COVID-19 pandemic is lamentable, despite the already strategizing effort seen from many countries towards mobilising resources to curb future epidemics. Prioritising adequate funds will boost health security to attain universal health coverage.

Afolabi ORIYOMI, Head of Research, Young Professionals and Emerging Leaders (YPEL) and Oluwasegun Oginni, team member, YPEL Research