Sheriff Oborevwori
The proposed N936 billion budget for Delta State in 2025 appears impressive, but beneath the surface lies a different reality. The 29.12% increase from the current year’s budget, hailed by State Commissioner for Economic Planning, Mr. Sonny Ekedeyan, as a product of the government’s commitment to advancing the state’s development, is actually a blatant attempt to obscure the truth about the state’s financial struggles.
The budget growth is primarily driven by increased FAAC allocations, stemming from President Bola Ahmed Tinubu’s APC-led federal government reforms, rather than any initiatives by Governor Sheriff Oborevwori, who has yet to introduce meaningful reforms as part of his MORE agenda since taking office one and a half years ago. Furthermore, the proposed budget’s heavy reliance on FAAC allocations raises concerns about its long-term sustainability for Delta State’s development.
At only N140 billion, the Internally Generated Revenue (IGR) is alarmingly low, accounting for only 15% of the total budget. This indicates a heavy reliance on federal allocations and external revenue sources, which is concerning, especially when compared to other states like Lagos, FCT, Rivers, and Ogun, which have achieved significantly higher IGR figures.
Additionally, the downward spiral of the Internally Generated Revenue (IGR) is troubling. In 2023, the IGR of N87.6 billion for the period January to September accounted for 17.35% of the total budget. This year’s IGR accounts for a meager 16.35% of the approved budget. Next year’s figure of 15% confirms a negative trend that raises serious red flags about the state’s financial management.
Clearly, the state’s IGR has stalled, indicating potential underreporting and widespread fraud in revenue collection. Indeed, the revenue collection system established during Okowa’s tenure, where party chieftains act as consultants collecting revenue and remitting a percentage to the government, has failed woefully.
The low IGR is a clear indication of successive administrations’ failure to drive economic growth and diversification, as well as explore alternative revenue streams beyond oil and gas. This lack of self-sustenance undermines the state’s economic potential.
Consequently, the state’s economic potential, driven by its rich natural resources, including crude oil and natural gas, remains largely untapped. Agriculture is another vital sector that substantially contributes to the state’s economy, with oil palm, yam, and cassava crops being major produce.
Furthermore, the state’s failure to harness its tourism potential, despite boasting beautiful landscapes and cultural attractions, is a missed opportunity for revenue generation. The absence of a robust manufacturing sector and inadequate infrastructure also stifles economic growth.
To strengthen Delta State’s financial foundation and foster meaningful development, the government must adopt a multi-faceted approach. This includes diversifying revenue streams, ensuring transparency in revenue collection, tackling underreporting and fraud, and bolstering Internally Generated Revenue (IGR) through strategic investments in vital sectors like agriculture and infrastructure.
The New Delta Coalition urges Governor Oborevwori to capitalize on opportunities presented by President Ahmed Tinubu’s economic reforms, which have boosted FAAC allocations and agricultural prices. By introducing reforms and initiatives promoting farming, food processing, and basic infrastructure, Delta State can break free from financial constraints and secure sustainable growth for its citizens.
Signed:
Godwin Anaughe
On behalf of New Delta Coalition
