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    Monday, July 8, 2024

    FG Releases ₦1.2tn To 17 Ministries For Capital Projects

    The Federal Government of Nigeria has disbursed ₦1.2 trillion to 17 ministries for the execution of capital projects.

    The Nigerian Government disbursed ₦1.23 trillion to seventeen ministries for the implementation of capital projects during the third quarter of 2023.

    As per the Budget Implementation Report for Q3, 2023, published by the Budget Office on Sunday, a significant deviation from the ₦5trn allocated for capital expenditure in the 2023 budget, resulted in a deficit of ₦3.8tn.

    The fund's primary objective, as of September 30, 2023, was to promote and support initiatives focused on development and infrastructure.

    Capital projects represent substantial investments in tangible infrastructure or assets that are anticipated to yield enduring advantages. These endeavors typically entail the construction, procurement, or refurbishment of physical assets, encompassing structures, roadways, bridges, dams, educational institutions, healthcare facilities, and other installations.

    The report also revealed that the ministries only utilized ₦962.87 billion out of the allocated cash backing of ₦1.23 trillion.

    The report indicated that the distribution of funds to government ministries, departments, and agencies (MDAs) for capital expenditures during the third quarter of 2023 was carried out in stages, taking into account resource availability and government priorities. According to data obtained from the Office of the Accountant-General of the Federation (OAGF) on the capital performance of MDAs up until September 30, 2023, a total of N1.23 trillion was disbursed to MDAs and supported with cash for capital projects and programs planned for 2023.

    “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 further stated that an analysis 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 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 Defense, Public Works, and Agriculture received the most significant capital allocations, with ₦189.39 billion, ₦178.62 billion, and ₦128.24 billion, respectively. Conversely, the Office of the National Security Advisor, the Ministry of Environment, and the Ministry of Women received the least financial support, with ₦3.93 billion, ₦3.73 billion, and ₦5.37 billion, respectively.

    The Ministry of Defence received the highest allocation for capital projects, with a budget of ₦189.39 billion. However, only ₦180.69 billion was utilized, leaving a balance of ₦9.3 billion.

    Subsequently, the Ministry of Works and Housing received a total cash-backed allocation of ₦178.62 billion. However, only ₦118.65 billion was utilized, resulting in a remaining balance of ₦57.97 billion.

    The Ministry of Agriculture received a financial allocation of ₦128.24 billion, of which ₦109.89 billion was utilized, resulting in an unutilized balance of ₦18.35 billion.

    Other ministries, including Water Resources, utilized ₦21.81 billion out of the ₦28.27 billion disbursed. The Ministry of Education only spent ₦31.35 billion out of its ₦54.03 billion allocation. The Ministry of Health spent ₦34.82 billion out of its ₦55.77 billion allocation, while the Ministry of Aviation utilized ₦5.94 billion out of its ₦20.44 billion cash backing.

    Likewise, the Ministry of Science, Innovation, and Technology utilized ₦12.76 billion out of the ₦44.08 billion allocated for capital projects. The Ministry of Transport expended ₦43.39 billion out of its ₦56.55 billion allocation. The Ministry of Humanitarian Affairs and Disaster Management disbursed ₦37.13 billion for capital projects out of the ₦53.4 billion cash-backed funding. The Office of the Secretary-General of the Federation disbursed ₦14.04 billion out of its ₦17.37 billion allocation. The Ministry of Police Affairs utilized ₦27.42 billion out of the ₦29.79 billion released. The Ministry of Labour and Productivity disbursed ₦6.06 billion out of ₦8.87 billion, while the Ministry of Interior disbursed ₦15.66 billion out of its ₦16.81 billion allocation.

    The budget office has Indicated that the majority of projects implemented were constituency projects that fell outside the purview of the MDAs.

    It is concerning that these projects are being prioritized over those that align with the mandate of the MDAs.

    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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