When the IGR data was released for the year 2017, it told a sad story for the 5 Igbo States namely Enugu. Anambra, Imo, Ebonyi and Abia.
None of these states can survive by what the generates as revenue without federal allocation. What it means is that these 5 south eastern states are poor and financially insecure. This is very dangerous. The danger is without federal allocation these 5 south eastern states will not be able to pay salaries or keep the states running. This may result to high borrowing without proper payback financial plan which may further worsen the situation.
For instance, Cross River State generates more money than Anambra State, and Ogun State generates more money than the entire 5 south eastern states put together last year.
Last year, Anambra State passed the 2017 Appropriation Bill of N115.5 billion, but generated N17.3 billion as Internal Generated Revenue. The danger is that Anambra State spent 6.6 times higher than what the state generated last year. Another danger is when the “free” federal allocation does not pass through a productive channel, it exacerbates inflation. For instance, salaries shouldn’t be paid directly with federal allocation. It should be paid from the state “federal allocation” investment proceeds, but this is not the case. I am using Anambra State as a model.
It would have been better if it was the other way round. That is to say Anambra State generates N150 billion as IGR, and gets N10 billion as federal allocation.
Last year, Abia State passed the 2017 Appropriation Bill of N102.5 billion, but generated N14.9 billion as Internally Generated Revenue.
Enugu State passed the 2017 Appropriation Bill of N105.7 billion, but generated N22 billion as Internally Generated Revenue.
Imo State passed the 2017 Appropriation Bill of N131 billion, but generated N6.8 billion as Internally Generated Revenue.
Ebonyi State passed the 2017 Appropriation Bill of N127.2 billion, but generated N5.1 billion as Internally Generated Revenue.
Is it that the eastern government has inefficient tax regime? Is the IGR a reflection of the southeastern states’ economy? How can the southeastern states become economically viable to the extent of not depending on the federal allocation?
2017 IGR for the selected States below:
(ENUGU – N22,039,222,902.86)
(ANAMBRA – N17,365,385,830.51)
(IMO – N6,850,796,866.07)
(EBONYI – N5,102,902,366.82)
(ABIA – N14,917,141,805.80)
*(OGUN – N74,835,979,000.51) higher than all 5 south eastern states IGR put together.
*(CROSS RIVER N18,104,562,225.62) higher than Anambra State.
Data source: National Bureau of Statistics (NBS)