• Citizens should ask questions about how govts spend money – Economic experts
In spite of the unprecedented hardship in the country occasioned by high inflation, incredibly high cost of living owing to prices of virtually every commodity that have risen astronomically in the past few months, the federal government, 36 states and 774 local governments in the country shared over N8 trillion between June 2023 and January 2024, according to documents obtained from the Office of the Accountant-General of the Federation.
A total of N8, 148, 924, 000, 000. 00 was shared by the three tiers of government in the eight months. While the federal government got approximately N2, 989,198 trillion; states got about N2, 690,391trillion, while local governments received approximately N1, 975,899trillion within the period.
Between January and June 2023, the sum of N4.37 trillion was shared by the three tiers of government. The federal government received about N1.78 trillion, (or 40.7 per cent of that sum), while the state governments received N1.5 trillion, or 34.5 per cent, and the Local Government Councils, N1.08 trillion or 24.8 per cent of the total distributable revenue for the period.
Again, between 2020 and 2021, N14.38 trillion was remitted into the federation account. Within the period, N5.42 trillion was distributed to the three tiers of government by the Federal Accounts Allocation Committee (FAAC). The federal government received N2.8 trillion, while N1.45 trillion and N1.17 trillion was received by the states and local government areas respectively.
In spite of the increase in the revenue accruing to the governments at all levels, the purchasing power of majority of Nigerians has declined in an alarming proportion with prices of basic items soaring.
The obtained documents showed that N907, 054billion was the allocation for June 2023. The federal government got N345, 564billion, states received N295, 948billion and local governments got N218.064billion approximately.
For July 2023, the total allocation was put at N966, 110billion, from which the federal government got N374, 485 billion, states got N310,670bn and local governments received N229,409billion approximately.
In August 2023, the allocation jumped to an approximate sum of N1, 100,101trillion. The federal government got the lion’s share of N431, 245billion, while the states and local governments received approximately N361, 188 billion, and N266, 538 billion respectively.
The allocation for September 2023 went down to N903, 480billion and the federal, states and local governments received N320, 543billion, N287, 071 billion, and N210, 900 billion respectively.
In October 2023, the three tiers of government shared N906, 955billion, from which the federal got N323, 355 billion, states received N307, 717billion and local governments got N225, 209 billion.
The allocation also increased to N1, 088 trillion in November 2023, and the federal government received N402, 867 billion, the states got N351, 697 billion, while the local governments received N258, 810 billion.
In December 2023, the allocation moved up to N1, 127, 408 trillion in December 2023. From it, the federal government got N383, 872 billion, states got N396, 693 billion, and local government also got N288,928billion.
In January 2024, the three tiers of government shared approximately N1, 149, 816 trillion. The federal government received N407, 267 billion, states got N379, 407 billion, while the local governments received N278, 041 billion as well.
Market survey reveals mindboggling prices.
The announcement of the removal of subsidy on petrol by President Bola Tinubu on May 29, 2023, in his inaugural address to the nation has brought a sharp increase in the allocations to the three tiers of government, but the cost of living has continued to rise, while prices of essentials, including food items, have also continued to escalate.
A market survey conducted by Saturday Sun on the changes in prices of essential commodities between December 2023 and February 2024 in Lagos showed that a bag of rice sold for between N54,000 and N56,000, sells for between N74,000 and N86,000. A big bag of beans, which was sold for between N130,000 and N150,000, is now N180,000. A big bag of white garri was N35,000, and now, it is N60,000. A big bag of yellow garri was N18,000, and now, it is N30,000.
A carton of Shawa fish, sold for N19,000, now sells for between N40,000 and N42,000. A carton of Cote fish has also moved up from N30,000, to N64,000. A carton of Titus fish, which was about N55,000, now goes for N120,000 and N121,000.
A full carton of whole chicken was N25,000, now, it is N40,000. Turkey now sells for N70,000 for a carton as against N35,000 in December 2023. Also, 25 litres of groundnut oil, which was sold between N20,000 and N25,000 two months ago, is now N30,000. A crate of egg, which was N2,400 two months ago, is now N3,700
A small basket of fresh tomatoes was N8,000, while the big size was N15,000. Now, they are being sold for N20,000 and N30,000 respectively. A bag of onion was about N50,000, but it is currently sold for N130,000.
A trader at Bashorun Market, Ibadan, Oyo State, Mrs. Rukayat Bello, said a basket of tomatoes which she used to buy for N6,000 to N8,000 up till May 2023, has jumped to N65,000. She added that a small basket which she used to buy for N5,000 to N8,000 is now N20,000. She stated that a small bag of pepper, which was N6,000 as of May last year, has gone up to N45,000, while a big bag which used to be N10,000 has also skyrocketed to N90,000. She added that the price of five pieces is now N200.
“The prices that I gave you may change when I go to the market the next time. But on top of these prices, I have to factor in my own profits. This is why things are expensive. It is not the fault of the pepper and tomato sellers. It is the situation of the country.
“Pepper is plenty in the market, but very expensive. Now, I cannot make daily contributions again because the number of people that come to buy pepper and tomatoes have reduced. We are not making much profit again.”
Also, Mrs. Yinka Akanni, who operates a mini supermarket in Akobo, Ibadan, said a bag of rice ranged from N25,000 to N35,000 as of May 2023, but now it ranges between N65,000 and N86,000.
A food seller at Ogba in Lagos, Lizzy Umoren, could not hide her frustration when customers complained that the food, she sold to them was too small for the amount they paid.
According to her, “It is not about me, but about what I bought in the market. I don’t want to reduce the quality of my food; otherwise, it would have just been quantity. I bought one Derica of white garri for N2,000 and one Derica of yellow garri for N3,000. By this time last year, a Derica of white garri was not more than N800 and yellow garri for N1,400. A bag of rice is now N86,000.”
Some cement dealers also said a bag of cement which was sold for between N5,000 and N5,500 up till May or thereabouts last year, now go for between N10,000 and N15,000.
Citizens should demand accountability at sub-national levels – Expert.
Reacting to the high-level poverty ravaging people in different states despite enormous resources at the disposal of governments at all levels, the Director General, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, said the time has come for citizens to rise from their slumber and demand accountability from leaders at the sub-national level.
In a telephone chat with Saturday Sun, Yusuf said there was a terrible level of priority misplacement in many states, such that huge FAAC allocations do not reflect on the citizens or the infrastructure. “Citizens at the state level should begin to demand some degree of transparency at state and local government levels. Citizen engagement is low and there is disconnect between the states and the people.
“It’s obvious, FAAC money goes to where it should not go. States should be more accountable. FAAC money is not spent on vital projects at all. The situation is worse in LGAs. There is this over-dependency on Federal Government, and it should not be,” he said.
What Nigerians should be more concerned about – Don?
Dr. Olabode Badru, a Senior Lecturer, Department of Agric Extension and Rural Development, University of Ibadan, also shared his thoughts on the food crisis in Nigeria and the importance of state governments utilizing the increased funding allocated to them by the Federal Government.
He emphasized the need for state governments to play a more active role in the development of agriculture, stating that the recent increase in funding from the Federal Government is a positive step towards giving states a larger stake in governing their own affairs.
Badru stated that the impact of the increased funding may not be immediate but would be seen in the medium and long term if utilized effectively. He also stressed the need for state governments to address issues, such as insecurity, which can hinder agricultural production in key food-producing regions.
He called for a reevaluation of the staffing and funding of agricultural research institutes to support the agricultural sector, emphasizing the need for research findings to address the high rate of post-harvest losses in the country.
According to him, “What the Federal Government has done is a good thing. We run a federal system, and the Federal Government cannot be running the show on its own. What we have all been canvassing all along is for the states to have a larger stake in the way things are run. I think that is what this present government is doing.
“Moreover, when they were removing the subsidy, one of the reasons they gave to us was that there wasn’t enough money. If they removed the subsidy, there would be more money to run the government and to deploy to more development activities. So, if they are now sharing more money as FAAC to the states, I think it is a welcome development.
“But what we should be more concerned about is how well are the states are spending the money on what the money is actually meant for. I have heard some levels of activities in Niger, Lagos and Anambra States. The three states are devoting a lot of money into agriculture, and equipment that will boost agriculture. But is it like that in all other states?
“For the first time now, Nigerians are becoming more alive where they should actually beam their searchlight, and that is to the governors because they control a lot of things. No matter the good intention of the Federal Government, if the states and local government do not key into it, it is a total waste of time.
“So, a lot is expected from the governors, though for us to see the effect of this money that is being pumped into the states, if the money is being spent well, it is not something we can see immediately. It is not an immediate solution to the problem. It is something that we will see in the medium and long terms.
“We should not also forget the fact that though the allocation might have increased, the value of the allocation has actually reduced. When we look at the inflation rate, the purchasing power, and how much was a bag of rice pre-subsidy removal, and post-subsidy removal. So, what the money will actually purchase cannot be compared with what it could purchase in the past. These are some of the variables that we need to look into.”