The Nigerian Government disbursed ₦1.23 trillion to 17 ministries for capital projects in the third quarter of 2023.
According to the Q3 2023 Budget Implementation Report released by the Budget Office on Sunday, this amount was 75.4% lower than the ₦5 trillion allocated for capital expenditure in the 2023 budget, resulting in a deficit of ₦3.8 trillion.
The funds were intended to advance development and infrastructure initiatives as of September 30, 2023.
Capital projects are significant investments in physical infrastructure or assets expected to provide long-term benefits. These projects typically involve the construction, acquisition, or renovation of tangible assets such as buildings, roads, bridges, dams, schools, hospitals, and other facilities.
The report also indicated that the ministries utilized only ₦962.87 billion out of the ₦1.23 trillion released.
The report partly read, “The release of funds to MDAs for capital expenditure as at the third quarter of 2023 was done in tranches based on availability of resources and government priorities. Data from the OAGF on 2023 capital performance for MDAs as of 30th September 2023 showed that a total of N1.23tn was released to MDAs and cash-backed for 2023 capital projects and programmes.
“The sum of ₦351bn was released as the first Tranche, ₦331.92bn was the second Tranche and ₦208bn was the third Tranche. A total of ₦75.35bn was released as AlEs MDAs Budget and ₦261bn as AlEs Service Wide.”
It added that a breakdown of the 52 MDAS included in the report of the Office of the Accountant General of the Federation indicated different levels of utilisation.
“42 of the MDAs representing (80.77 per cent) had utilised more than the overall average utilisation rate of 52.44 per cent of the amount cash-backed. 35 out of them had above 65.0 per cent utilisation rate while only four (7.72 per cent) had one hundred per cent utilisation level.
“The utilization report also revealed that 10 (18.18 per cent) of the MDAs had below 40 per cent utilisation rate of their cash-backed funds. Five (9.10 per cent) of the MDAS had utilisation rates of below 20 per cent while three (5.45 per cent) were yet to utilise anything from the funds released to them,” it stated.
The Ministries of Defence, Works, and Agriculture received the highest capital allocations of ₦189.39bn, ₦178.62bn, and ₦128.24bn, respectively. Conversely, the Office of the National Security Adviser, the Ministry of Environment, and the Ministry of Women Affairs received the lowest cash backings of ₦3.93bn, ₦3.73bn, and ₦5.37bn, respectively.
A detailed breakdown shows that the Ministry of Defence received the highest allocation for capital projects with a cash backing of ₦189.39bn but only utilized ₦180.69bn, leaving a balance of ₦9.3bn.
Following this, the Ministry of Works and Housing received a total cash-backed allocation of ₦178.62bn, but it utilized ₦118.65bn, leaving a balance of ₦57.97bn.
The Ministry of Agriculture received a cash backing of ₦128.24bn but utilized ₦109.89bn, leaving a balance of ₦18.35bn.
Other ministries showed similar underutilization:
- The Ministry of Water Resources utilized ₦21.81bn out of ₦28.27bn disbursed.
- The Ministry of Education spent ₦31.35bn out of a ₦54.03bn allocation.
- The Ministry of Health spent ₦34.82bn out of its ₦55.77bn allocation.
- The Ministry of Aviation utilized ₦5.94bn out of a cash backing of ₦20.44bn.
- The Ministry of Science, Innovation, and Technology spent ₦12.76bn out of the ₦44.08bn cash-backed for capital projects.
- The Ministry of Transport spent ₦43.39bn out of its ₦56.55bn allocation.
- The Ministry of Humanitarian Affairs and Disaster Management released ₦37.13bn for capital projects out of a cash-backed funding of ₦53.4bn.
- The Office of the Secretary to the Government of the Federation disbursed ₦14.04bn out of its ₦17.37bn allocation.
- The Ministry of Police Affairs spent ₦27.42bn out of the ₦29.79bn released.
- The Ministry of Labour and Productivity disbursed ₦6.06bn out of ₦8.87bn.
- The Ministry of Interior disbursed ₦15.66bn out of its allocation of ₦16.81bn.
The Budget Office noted that many implemented projects were constituency projects not within the MDAs’ mandate, a practice deemed problematic as these projects are prioritized over those aligned with the MDAs’ core functions.
The report read in part, “Most MDAs’ capital projects are dominated by constituency projects. This practice is disturbing because although most of the projects have no direct bearing with the mandate of the host agencies, they are prioritized over the projects in line with the mandate of the MDAS.”
It further recommended that ‘Considering the preponderance of constituency projects that are not within the mandate of the MDAs, it is important to emphasise and prioritise only capital projects that are in line with the mandate of the various MDAs during budget preparation and implementation.”
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