By Dele Sobowale.

“The Federation Accounts Allocation Committee on Friday shared N613.6bn among the three tiers…[and] N620.73bn shared in the month of February”. PUNCH, April 21, 2012.

COMPARISON OF MONTHLY ALLOCATIONS: JUNE 2006 AND FEBRUARY 2016.

It is no longer news that the states of Nigeria are in serious financial straits. Nigerians need to know how they got into these difficulties and the way out can then be sought. The years 2012 and 2013 were our golden years in terms of crude oil revenue and allocations from the Federation accounts to the three tiers of government. The figures below tell part of the story better than any number of words can tell us.

2012               2016             DIFFERENCE(%)

FEB    N620.73bn  N370.39bn              40

As can be seen from the figures above, all the three tiers of government will receive for February 2016, N250.34bn, or 40% less funds than they did in 2012. That is bad enough. Take a look at the figures below. The total revenue allocation to all the 36 states in 2006 and 2016, a decade after, are very revealing.

JUN 2006                    FEB 2016     DIFFERENCE(%)

N196bn                  N97.31bn             51

In other words, the states are receiving in the first two months of 2016 only half of what they collected in 2006. More revealing is the fact that four states, in 2006, collected over N14bn each. In descending order, they were: Rivers (N23bn),  Bayelsa (N18bn), Delta (N16bn) and Akwa Ibom(N14bn). The least revenue collected by any state in June 2006 went to Nasarawa (N2.99bn). In February 2016, no state collected up to N10bn. The top four revenue earners in February 2016 were: Akwa Ibom(N8.55bn), Lagos (N6.61bn), Delta(N6.06bn) and Rivers (N5.42bn). That means that Akwa Ibom now collects 61 per cent of what it did in 2006 Rivers now collects 24 per cent of what was taken home in 2006, Delta 38 per cent; Bayelsa only 17 per cent. See the table below.

STATE                           JUN 2006    FEB 2016    DIFFERENCE(%)

Akwa Ibom     N 14bn           8.55bn                         -39

Bayelsa            N18bn            2.98bn                        -83

Delta                N16bn            6.06bn                        -62

Rivers              N23bn            5.47bn                        -76

Incidentally, Lagos State has emerged as the second highest collector of federally allocated revenue with N6.6bn in February 2016 and it is the only state which earned more in 2016 than it did in 2006. The reason is clear. The state’s share of the Value added Tax, VAT, had steadily pushed it close to the top. There is a subtle lesson for all states in this: attract manufacturers to your state and earn the rewards afterwards in high Internally Generated Revenue, IGR.

The state collecting the least allocation in February 2016 was Osun state (N6.23m). That is right, a mere six million two hundred and twenty nine thousand naira for a state claiming a monthly wage bill of close to N2.7 billion. Now it is clear why that state is in the sort of turmoil which other states will soon be experiencing.

How about Bayelsa state, the former President’s own state? Well, Bayelsa went from N18bn in June 2006 to an astonishing N2.98bn in February 2016 – a drop of 83% from ten years ago. That makes Bayelsa the second worst case among states. Osun State, unfortunately, carries the unwanted trophy of the state closest to bankruptcy.

THE ROAD TO HELL

The logical question is how did we get into this sorry situation as result of which state governments and their public servants are now poised for protracted conflict? Only a fool can fail to see the danger signs all over Nigerian states.

For this another set of facts are required — drawn from the records.

NUMBER OF STATES COLLECTING REVENUE

Categories           States Jun 2006         States Feb 2016

N25-10bn                    4                                    0

N9-6bn                        3                                    4

N5-4bn                        7                                    0

N3-2bn                       22                                 25

Under N2bn               0                                    7

The facts are clear. States are getting increasingly poorer. Furthermore, whereas only one state collected less than N3bn in June 2006 and that was Nasarawa, N2.9bn, thirty two states in February of this year would collect less than that amount – and that trend will continue indefinitely. It might even get worse with time.

PUTTING ON OUR THINKING CAPS

The first thing the reader, even if he is a paid employee of a state government, should discard is the notion that this piece has been written to run down his state government. Obviously, when Osun (APC controlled) and Bayelsa (PDP controlled) had been highlighted from figures supplied by the Federal Ministry of Finance, every state is only receiving a feedback on how well it had prepared itself for the proverbial rainy day. On the whole state governors of the class of 2007 to 2015 have been irresponsible and perhaps unpatriotic – irrespective of what their party members and paid defenders might say about them.