The Federal Government has released a total of N1.23 trillion to 17 ministries for the implementation of capital projects aimed at furthering development and infrastructure initiatives as of September 30, 2023, according to The Punch.
The analysis of the Budget Implementation Report for the third quarter of 2023 released by the Budget Office has shown.
In the context of budgeting, capital projects are often large investments in physical infrastructure or assets that are projected to yield long-term returns. These projects typically include the construction, acquisition, or renovation of tangible assets such as buildings, roads, bridges, dams, schools, hospitals, and other structures.
According to the analysis, the amount distributed was 75.4% less than the N5 trillion earmarked for capital spending in the 2023 budget, resulting in a deficit of N3.8 trillion.
The data found that the amount disbursed was 75.4% lower than the N5 trillion earmarked for capital spending in the 2023 budget, resulting in an N3.8 trillion shortfall.
The report also revealed that the ministries only used N962.87 billion of the financial backing of N1.23 trillion.
The sum of N351bn was released as the first Tranche, N331.92bn was the second Tranche and N208bn was the third Tranche. A total of N75.35bn was released as AlEs MDAs Budget and N261bn as AlEs Service Wide.
It further stated that a breakdown of the 52 MDAs contained in the report of the Office of the Accountant General of the Federation revealed varying degrees of utilization.
“42 of the MDAs representing (80.77 per cent) had utilized more than the overall average utilization rate of 52.44 percent of the amount cash-backed. 35 out of them had an above 65.0 percent utilization rate while only four (7.72 per cent) had a one hundred percent utilization level.
“The utilization report also revealed that 10 (18.18 per cent) of the MDAs had below 40 percent utilisation rate of their cash-backed funds. Five (9.10 per cent) of the MDAS had utilization rates of below 20 percent while three (5.45 per cent) were yet to utilize anything from the funds released to them,” it stated
In the report, the Ministries of Defense, Works, and Agriculture had the largest capital allocations of N189.39 billion, N178.62 billion, and N128.24 billion, respectively, while the Office of the National Security Adviser, Ministry of Environment, and Women received the lowest cash backing of N3.93 billion, N3.73 billion, and N5.37 billion.
A breakdown revealed that the Ministry of Defence received the greatest allocation for capital projects, with a cash backing of N189.39 billion, but only spent N180.69 billion, leaving a balance of N9.3 billion.
The Ministry of Works and Housing then allocated N178.62 billion in cash. It spent N118.65 billion, leaving a balance of N57.97 billion.
The agriculture ministry got cash backing of N128.24bn but utilised N109.89bn leaving a balance of N18.35bn.
Other ministries, such as Water Resources, spent N21.81 billion out of N28.27 billion, Education spent N31.35 billion out of N54.03 billion, Health spent N34.82 billion out of N55.77 billion, and Aviation spent N5.94 billion out of N20.44 billion in cash backing.
Similarly, the Ministry of Science, Innovation and Technology spent N12.76bn out of the N44.08bn cash backed for capital projects, Transport spent N43.39bn out of its N56.55bn allocation, the Ministry of Humanitarian Affairs and Disaster Management released N37.13bn for capital projects out of cash backed funding of N53.4bn, the Office of Secretary General of Federation disbursed N14.04bn out of its N17.37bn allocation. Police Affairs Ministry spent N27.42bn out of the N29.79bn released, Labour and Productivity disbursed N6.06bn out of N8.87bn and the Ministry of Interior disbursed N15.66bn out of its allocation of N16.81bn.
Last month, the National Assembly agreed to the Federal Government’s request to prolong the life cycle of the N21.8 trillion 2023 budget and the N2.17 trillion extra allocation from June 30 to December 31, 2024.
This came after both chambers extended the implementation time for the budget’s capital component from December 31, 2023, to March 31, 2024, as well as the 2023 supplementary budget passed in November 2023 last year.
Although stakeholders including opposition parties faulted the need to run four budgets concurrently, the Spokesman for the President, Bayo Onanuga, in an interview, said the budget cycle was extended to December to ensure that the capital projects contained in the appropriations were not abandoned.
Onanuga defended the prolongation of the budget cycle, saying, “It is because it (the 2023 supplementary budget) is running simultaneously with the 2023 budget. Some elements of that budget were not implemented. That is why they are moving it forward to be implemented.
“They have already got the provisions meant for them. So, they are trying to make sure they implement them based on the provision of that budget. It means the 2023 and 2024 budget will run concurrently.’’
Meanwhile, the budget office has claimed that the majority of projects completed were constituency projects that do not fall under the purview of MDAs.
It said the practice is disturbing because these projects are prioritised over the projects in line with the mandate of the MDAs.
The report reads “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.”
