The Nigerian Government disbursed ₦1.23 trillion to 17 ministries for capital projects in the third quarter of 2023.
According to the Budget Implementation Report for Q3 2023, released by the Budget Office on Sunday, this amount is 75.4 percent 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 refer to major investments in physical infrastructure or assets that are 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 revealed that the ministries only utilized ₦962.87 billion out of the ₦1.23 trillion that was allocated.
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 ₦189.39 billion, ₦178.62 billion, and ₦128.24 billion, respectively. In contrast, the Office of the National Security Adviser, the Ministry of Environment, and the Ministry of Women Affairs received the lowest cash backing of ₦3.93 billion, ₦3.73 billion, and ₦5.37 billion, respectively.
A detailed breakdown shows that the Ministry of Defence received the highest allocation for capital projects with ₦189.39 billion but utilized only ₦180.69 billion, leaving a balance of ₦9.3 billion. The Ministry of Works and Housing followed, with a total cash-backed allocation of ₦178.62 billion, of which ₦118.65 billion was utilized, leaving a balance of ₦57.97 billion. The Ministry of Agriculture had a cash backing of ₦128.24 billion but utilized ₦109.89 billion, leaving a balance of ₦18.35 billion.
Other ministries’ utilizations include the Ministry of Water Resources, which used ₦21.81 billion out of ₦28.27 billion disbursed; the Ministry of Education, which spent ₦31.35 billion out of ₦54.03 billion allocated; and the Ministry of Health, which used ₦34.82 billion out of its ₦55.77 billion allocation. The Ministry of Aviation utilized ₦5.94 billion out of a cash backing of ₦20.44 billion.
Additionally, the Ministry of Science, Innovation, and Technology spent ₦12.76 billion out of ₦44.08 billion; the Ministry of Transport used ₦43.39 billion out of ₦56.55 billion; and the Ministry of Humanitarian Affairs and Disaster Management released ₦37.13 billion for capital projects out of ₦53.4 billion. The Office of the Secretary General of the Federation disbursed ₦14.04 billion out of ₦17.37 billion allocated, the Ministry of Police Affairs spent ₦27.42 billion out of ₦29.79 billion released, the Ministry of Labour and Productivity disbursed ₦6.06 billion out of ₦8.87 billion, and the Ministry of Interior disbursed ₦15.66 billion out of its ₦16.81 billion allocation.
The Budget Office stated that the majority of projects implemented were constituency projects not within the mandate of the Ministries, Departments, and Agencies (MDAs). This practice is concerning because these projects are prioritized over those aligned with the MDAs’ mandates.
The report emphasized, “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 prioritizing only capital projects that align with the MDAs’ mandates during budget preparation and implementation, considering the prevalence of constituency projects not within their mandates.