Editorial:Nigerian States Struggle to Alleviate Poverty Despite Increased Federal Allocations

 

Critics argue that governors have failed to demonstrate a corresponding level of commitment to alleviating poverty and developing local industries within their states. Instead, allegations suggest that some governors are misappropriating state funds to serve personal interests and cartel networks, rather than investing in capacity-building initiatives and supporting local businesses.

The federal government’s substantial allocations to the states were intended to support development and poverty reduction efforts. However, the perceived lack of progress has raised concerns about the effectiveness of governance at the state level and the need for greater accountability and transparency in the use of public funds.

Despite receiving substantial federal allocations, many Nigerian states struggle to alleviate poverty. According to the Multidimensional Poverty Index (MPI), 72% of rural residents live below the poverty line compared to 42% in urban areas. The intensity of rural poverty is also higher, at 42% versus 37% in urban areas.

The poorest states in Nigeria, based on MPI, are:

1. Sokoto (0.409)
2. Bayelsa (0.401)
3. Jigawa (0.385)
4. Kebbi (0.385)
5. Gombe (0.380)
6. Yobe (0.370)
7. Plateau (0.365)
8. Taraba (0.340)
9. Zamfara (0.328)
10. Ebonyi (0.320)

Between January and May 2024, states received a total of N2.24 trillion in federal allocations, a significant increase from the N3.3 trillion disbursed in 2023. However, the bulk of this revenue comes from oil exports, taxes, and statutory allocations, rather than sustainable development initiatives.

The current revenue-sharing formula allocates 52.68% to the Federal Government, 26.72% to states, and 20.60% to local governments. While Lagos State will receive the highest revenue of N596.63 billion, other states like Adamawa, Anambra, and Bauchi will receive significantly less.

The disparity in revenue allocation raises concerns about the effectiveness of governance and poverty reduction efforts at the state level. With 70% of Nigeria’s population living in rural areas, it is crucial to address the systemic issues perpetuating poverty and inequality.

To break the cycle of poverty, states must prioritize sustainable development initiatives, invest in capacity-building programs, and support local industries. The federal government must also reassess the revenue-sharing formula to ensure equitable distribution and incentivize states to drive growth and development.”