News

20 Governors Borrow Fresh N446bn As Revenues Tumble

Published

1 year ago

September 18, 2024

Debt servicing costs incurred by 29 state governments consumed 80.7 per cent of their Internally Generated Revenue during the first six months of 2024, highlighting the significant financial burden the sub-nationals currently face, according to The PUNCH.

The dire situation also forced the governors to borrow a total sum of N446.29 billion within the same period despite a 40 per cent increase in its statutory allocation from the Federation Account.

The latest information is according to an analysis of data obtained by our correspondent using the budget implementation reports from each state’s website and Open Nigerian States. This BudgIT-backed website serves as a repository of government budget data.

The performance report is prepared quarterly and issued within four weeks from the end of each quarter.

This heavy burden underscores a critical issue in fiscal management, as the vast majority of the revenue that states could otherwise allocate to essential public services and development projects is being diverted to meet debt obligations.

It also reveals the severe constraints faced by state governments in managing their debt burdens inherited from previous administrations and addressing the needs of their residents.

Nigerians had hoped that with an increased statutory allocation of 40 per cent from the central government, state governors should have more than enough to fulfill their statutory obligations.

In 2023, state governors got the most FAAC allocations in at least seven years. The rise in FAAC allocations to the three tiers of government, especially states followed the petrol subsidy removal and currency reforms of the current administration.

The reforms have reportedly led to a 40 per cent boost in income. Experts believe the revenue increase should have reduced state governments’ appetite for more borrowing.

Instead, the sub nationals are spending a large chunk on repaying loans and taking more loans.

Recall report earlier had it that most of the Federal Accounts Allocation Committee funds for Osun, Ondo, Kaduna, and Cross Rivers states will be used in servicing debts this year.

This is because these states currently have a deficit of N10.94bn, N27.72bn, N15.83bn, N10.02bn respectively following debt servicing deductions by FAAC.

With such a large portion of revenue being used to service debt, it becomes increasingly challenging for states to achieve long-term economic stability and improve the quality of life for their residents.

Earlier this year, Kaduna State governor, Uba Sani had complained vehemently about the huge debt burden inherited from previous administrations, lamenting that it had stopped the prompt payment of salaries and more borrowings in the last nine months of his government.

The governor who made this known while addressing a Town Hall Meeting at the late Umaru Musa Yar’Adua Hall, stated that his administration inherited a total of $587m, N85bn, and 115 contract liabilities.

He said, “Despite the huge debt burden of $587m, N85bn, and 115 contractual liabilities sadly inherited from the previous administration, we remain resolute in steering Kaduna State towards progress and sustainable development. We have conducted a thorough assessment of our situation and are sharpening our focus accordingly.”

The PUNCH had reported that state governors faced an uphill task of stimulating the economies of their respective states after they inherited at least N2.1tn in domestic debts and $1.9bn in external debts from their predecessors.

This was as 22 states spent a total sum of N251.79bn to service debt borrowed by past administrations within nine months of assuming office (July 2023 and March 2024).

The situation also forced the state governments of Ekiti, Cross River, and Ogun to propose a suspension of their foreign debt repayments worth $501m due to severe foreign exchange volatility.

The request, though rejected by FAAC, was part of their efforts to mitigate the heightened debt service burdens, which state officials claimed has significantly hampered their ability to service existing debts.

Experts say the high debt servicing costs leave little room for investment in infrastructure, education, healthcare, and other key areas vital for economic growth and social welfare.

Meanwhile, an analysis of the budget implementation report showed that Akwa-Ibom, Borno, Cross Rivers, Edo, Katsina, and Niger spent between 60 and 80 per cent of their internally generated revenue to repay owed debts.

Also, states as Abia, Anambra, Bayelsa, Delta, Ebonyi, Ekiti, Jigawa, Enugu, Kebbi, Kwara, Ondo, Osun Zamfara, and Oyo disbursed between 13 and 58 per cent of their revenue for debt servicing

While the amount spent on debt servicing for nine states including Adamawa, Bauchi, Gombe, Imo, Kano, Kogi, Plateau, Taraba, and Yobe exceeded their revenue within the period.

Data for Benue, Nasarawa, Ogun, Rivers, Sokoto, and Kaduna states were not available when this report was filed. Only Lagos State recorded an impressive IGR of N603.71bn while it paid N201.49bn as debt charges.

A state-by-state breakdown indicated that Abia State under the leadership of Governor Alex Otti spent N4.83bn on servicing its debt, while it earned N15.6bn as revenue, representing a ratio of 31 per cent.

Adamawa spent N14.48bn on its debt but earned N5.75bn, recording a deficit of minus 252 per cent, Akwa-Ibom state spent N20.78bn on its servicing but got N31.74bn IGR indicating 65.4 per cent ratio.

Anambra serviced its debt with N4.8bn but got N18.61bn IGR at a ratio of 25.9 per cent. Bauchi got a debt service ratio of minus 42.9 per cent after it earned N3.92bn but spent N16.8bn on servicing. Bayelsa spent N17.84bn on servicing but earned N46.98bn as revenue, indicating a servicing ratio of 38 per cent.

Further analysis of the report indicated Borno spent N7.25bn on debt charges and earned N12.04bn, representing a ratio of 60.2 per cent, Cross Rivers had a debt service ratio of 60.7 per cent after it spent N12.05bn on loans and got N19.86bn IGR.

Delta State’s burden was 58.2 per cent after it spent N39.08bn on reducing its debt and earned N67.05bn within the review period. Ebonyi had a 48.6 per cent debt ratio due to its N5.05bn spending on debt and N10.39bn revenue collection. Edo State under the leadership of Governor Godwin Obaseki spent N22.66bn on servicing and collected N34.44bn as revenue, indicating a debt ratio of 65.8 per cent.

Ekiti had a debt service ratio of 47.9 per cent after it spent N7.85bn on loans and got N16.39bn IGR. Enugu spent N3.49bn on its debt but earned N16.39bn, indicating a 20.6 per cent ratio. Gombe spent N13.07bn on its debt but earned N9.6bn, recording a deficit of minus 136 per cent. Imo State also recorded a deficit of minus 1.10 per cent after it spent N10.68bn on servicing but got N9.69bn as revenue.

Also, Jigawa State spent N1.89bn on servicing while it earned N4.55bn as revenue, representing a ratio of 41.6 per cent. Kano recorded a deficit of minus 244.4 per cent due to N60.02bn expense on debt but collected N24.57bn as revenue.

Katsina had a 77.4 per cent debt ratio due to its N8.14bn spending on debt and N10.51bn revenue collection. Kebbi spent N1.99bn on its loan servicing while it earned N4.79bn as revenue, representing a ratio of 41.6 per cent. Kwara State recorded the lowest debt-to-revenue ratio of 13.9 per cent, and spent N4.87bn on debt charges but collected N35.1bn as revenue.

Kogi spent N12.79bn on servicing and collected N12.75bn as revenue, indicating a debt ratio of minus 1.06 per cent. Niger State recorded a debt ratio of 80.7 per cent due to debt charges of N11.88bn and revenue collection of N14.73bn.

Ondo State recorded a debt to revenue of 52.4 per cent, Osun (43.2 per cent), Oyo (57.2 per cent). Plateau State recorded the highest debt-to-revenue ratio of minus 550.76 per cent, spending N61.23bn on debt charges but collected N11.11bn as revenue. Taraba and Yobe states recorded a deficit of minus 283.5 per cent and 1.16 per cent respectively.

Experts have, however, attributed the significant increase in debt servicing cost partly to the devaluation of the naira, which drove up the cost of servicing foreign debt obligations as the nation grapples with the forex liquidity crisis and exchange rate volatility.

The Director/CEO of the Centre for Promotion of Private Enterprise, Dr Muda Yusuf, speaking in an exclusive interview on Sunday, stated that the significant debt servicing cost was adversely impacted by the depreciation of the naira, which caused a decline in its value relative to other currencies.

He noted that the enormous debt burden inherited by the current administration is also straining state finances and impacting its ability to meet major obligations.

Mr Muda said, “The point is that these states inherited a huge burden of debts. The figure mentioned may sound outrageous but is not much when calculated in dollar terms. Multilateral debts are also tied to infrastructural projects and developmental purposes. Borrowing is not in itself bad if it is used for developmental purposes but the burden of debt must not suffocate the state finances and affect its ability to fulfill major obligations.

“Also, those debts are foreign and once the naira depreciates, it affects the level of debt. As they struggle to service it, the level is still going up because of the exchange rate depreciation. With the depreciation of the currency, the burden of servicing those loans has become extremely very heavy. The exchange rate factor is a major challenge in the debt burden of many states.”

Government spending has come under increased scrutiny in recent times, particularly in light of the country’s worsening economic challenges.

At different fora, financial experts have also raised concerns about states’ spending on recurrent expenditure, highlighting the need to embrace financial innovations.

A professor of Economics at Babcock University, Segun Ajibola, stated that the enduring problem of high governance expenses had persisted at the state level, with inadequate oversight and accountability resulting in minimal economic benefits for grassroots citizens.

Ajibola, a former president of the Chartered Institute of Bankers, lamented that state assemblies had also abandoned their oversight duties, leaving the state governors to operate with no iota of transparency and accountability.

He said, “The first issue is the perennial complaint about the high cost of governance in Nigeria and at all levels. When you look at these issues, attention is often concentrated on the Federal Government, so the searchlight is always more on the central government. Most often, nobody cares about what is happening in the states and local government, and that is where the problem is.

“There are so many institutional frameworks in place to look at what is happening at the federal level but who cares about the states? The cost of governance in relative terms is even much higher in states than the federal and that is why you hardly feel the impact of governance in most states.

“Only a few states can boost a significant presence in the lives of their people in our states. The state assemblies are expected to conduct oversight functions on the activities of the executives in their respective states, but in reality, how many states are doing that, leaving the executives to be all in all incurring high costs.”

Meanwhile, 20 state governments borrowed a total sum of N446.29bn collectively to address their budget deficits and to cover various expenses, including essential services, infrastructure projects, and operational costs.

The PUNCH findings also revealed that the majority of these loans were sourced from multilateral and international creditors, contrary to the Federal Government’s emphasis on borrowing from the domestic market.

Further analysis showed that Cross Rivers State was among the states that got the highest loan of N121.22bn between January and June. It was followed by Oyo State with N55.36bn loans. Third on the list is Kogi State with loans worth N41.22bn.

Katsina State also obtained loans worth N34.09bn from creditors within the quarter.

Other states including Niger got N34.03bn, Gombe (N32.38bn), Ondo (N20,82bn), Borno (N20.7bn), Bauchi (N19.28bn), Taraba (N20.23bn), Yobe (N10.17bn), Kwara (N10.06bn), Ekiti (N7.94bn), Ebonyi (N6.43bn), Kano (N6.15bn), Abia (N3.37bn), Enugu (N1.39bn).

The states with the least borrowing include Edo (N633.73m), Osun (N250m), and Plateau state with N530.86m loan.
PUNCH

News

FULL TEXT: Gen Musa’s Inaugural Speech As Defence Minister

Published

20 hours ago

December 6, 2025

Editor

Newly appointed Defence Minister, General Christopher Gwabin Musa (rtd), on Friday, delivered his inaugural speech as he assumed office, pledging to end the shedding of innocent blood and strengthen Nigeria’s security architecture.

Here is the full speech:

FULL SPEECH: ADDRESS BY GENERAL CHRISTOPHER GWABIN MUSA (RTD), ON HIS ASSUMPTION OF OFFICE AS MINISTER OF DEFENCE.

December 5, 2025

It is with profound humility and a deep sense of responsibility that I address you today in my new capacity as the Minister of Defence of the Federal Republic of Nigeria. Six weeks ago, I was in Kaki. Now, I am coming as the Minister. It can only be God. I thank President Bola Ahmed Tinubu, GCFR, for the trust and confidence you have shown in me.

I take that very seriously. For me, it is indeed a privilege and an honour, after serving 39 years in service, to come in and now be the Minister of Defence of the Federal Republic of Nigeria. The love Nigerians have shown us reflects that people believe we can turn the tide.

But it is not rhetoric. It is by action. We must, firstly as Nigerians, take ownership of the responsibilities and challenges we face in our country.

It is only us who can solve the problem. It is when we agree within ourselves that we can deal with this, that we will succeed. God is with us, and He has always given us the responsibility to succeed.

This responsibility is one I accept with solemn reverence and unwavering commitment to the safety and security of our great nation, Nigeria. Let me also acknowledge the dedicated leadership of my predecessor and the relentless efforts of every one of you in this room.

When I was the Chief of Defence Staff, you gave me all the support, and I truly appreciate it. I want to assure you that coming back as Minister, we want to do more for your welfare, well-being, and the administration of the Ministry. I strongly believe in reward and accountability. You do well, you are rewarded. We take corrective measures to ensure we succeed. I don’t believe in “na so we dey do am.”

We must assess everything that we are doing and see whether we can improve it. I believe in fostering a positive workforce. We are going to listen to your challenges, and whatever we can do to address them, we will. But I count on you also to put in your best. You know your task ahead. You don’t have to wait until somebody calls you or asks you a question. Do what you are supposed to do, and that will make it easier for us as a nation.

The task of securing the nation is continuous, and I am aware that you have been holding the line with dedication. I commend you all. For decades, my life has been defined by uniform, by the ethos of service, and by sacred covenants to defend the territorial integrity and citizens of Nigeria. I therefore come to this role not as a stranger to our security challenges, but as a comrade who has been in the trenches both literally and figuratively. I’ve seen firsthand the bravery of our troops, the complexity of our threats, and the role of strategic coordination. Like I always say, no single individual can achieve this alone. No single service operator can do it. We must work as Nigerians, making Nigeria better.

Consequently, my core philosophy in ensuring the affairs of this ministry is simple: operational effectiveness through unified action and strategic foresight. Ladies and gentlemen, we cannot afford to operate in silos.

We cannot tolerate gaps between policy and execution, or between the ministry and the services. This ministry will be a powerhouse of strategic direction, enabling support, and relentless accountability. We must provide that support for our troops to continue to succeed. They are sacrificing their lives out there in the field—day and night, thunderstorm or windstorm—whatever the situation, to ensure that we, Nigerians, can go to bed and sleep well. We must continue to pray for them. We must continue to provide the necessary support.

Working as a team with other MDAs, Mr. President has made it very clear he will give us all the support we require and demands that we achieve success, which we have promised him. Within the first few weeks, we must show that we are committed: the ministry working inside, the troops working outside.

To translate this philosophy into action, my initial focus will rest on three interconnected pillars: enhancing joint operational strategy synergy. We will immediately begin a rigorous review of all theatre commands and inter-service operations. My door will be open, as always, to the Chief of Defence Staff and Service Chiefs for frank discussions on equipment, training, welfare, and strategy. Mr. President wants us to present our challenges, with the promise that they will be addressed. So it is left for us to do the needful.
Our goal is to overwhelm the adversaries with seamless jointness, not just cognition.

Welfare and Morale as a Force Multiplier

We all understand the importance of morale to our personnel and staff. We must therefore prioritise the timely provision of all necessary kits, ensure prompt payment of operational allowances, and vigorously address accommodation and medical care for our personnel and their families. Those not injured are watching how we treat the injured. If they are not taken care of properly, they will not give their best, because they will be apprehensive. Especially those who have lost their loved ones—the families want to know what will happen.

It is our responsibility to take care of them. The aspect of actions that impugn their integrity is not acceptable. We must make payments seamless. We must treat them with respect. Anybody who is laying down their life for their country deserves the highest respect, and that is what we offer. I will be very critical about that.

Intelligence-Driven and Technology-Enabled Defence

The Ministry of Defence is the strategic brain of our national defence architecture. We must therefore leverage technology for intelligence, surveillance, and recurring service. We have partners and allies ready to support us. We will reach out to them to work as a team. We will also collaborate with other security agencies. Every Nigerian is vital to the success of Nigeria. We will foster a culture where data and intelligence drive our decisions, not just experience alone. I charge the Ministry to be a catalyst for innovation and efficient resource management.

Distinguished ladies and gentlemen, I expect the highest standards of professionalism, integrity, and urgency from all of us. We do not have time to waste. We will continue to hit the ground running. We must respect the human rights of Nigerians. If we make mistakes, we must take necessary action to make amends. I will always encourage candid advice and robust debates. But once a decision is taken, we must move as one united team.

There will be zero tolerance for corruption, indiscipline, or indolence. Our loyalty is to Nigeria and the Nigerian people. The President is the Commander-in-Chief; the bulk stops on his table. We must provide the support required to make Nigeria peaceful.

Shedding of innocent blood is over. Our children should go back to school. Our farmers should go back to their farms. Most of the challenges we face are not military solutions—they are issues of good governance, justice, equity, and fairness, which we will encourage. Both non-kinetic and kinetic solutions must work hand in hand. We cannot afford to fail Nigerians. Charity begins at home; if we have the mindset that we will succeed, we will.

To the Service Chiefs, I offer my full support and expect your utmost cooperation to move the Armed Forces to greater heights. To the Department Secretary and the Civil Service cadre, you are the institutional memory and the framework for our sustainability. I value your expertise and count on your diligence to translate our military objectives into actionable administrative and budgetary policies.

The road ahead is demanding and will be tough. Let us not take it for granted. But because we are Nigerians, we shall overcome. The threats we face are adaptive and complex, but I have absolute faith in the indomitable spirit of our Armed Forces and the capable minds within the Ministry. With the support and prayers we are receiving from all Nigerians, we cannot fail.

In closing, let me once again reaffirm my commitment to lead with fairness, firmness, and loyalty to our Constitution. The President is doing everything possible to ensure our success. We must play our part. The task ahead is enormous, but surmountable. We can win. We will win. The good people of Nigeria are looking up to us for results, and we must deliver immediately. I am not here to preside; I am here to lead, to walk, and to deliver alongside you. I cannot do it alone. I thank you all as I look forward to our detailed work and the tasks ahead.

God bless you all, and God bless the Federal Republic of Nigeria.

Thank you.

— General Christopher Gwabin Musa (Rtd)
Minister of Defence, Federal Republic of Nigeria

News

Malami Breaks Silence On Alleged Terrorism Financing

Published

22 hours ago

December 6, 2025

Editor

A former Attorney-General of the Federation and Minister of Justice, Abubakar Malami, SAN, has broken his silence on allegations linking him to terrorism financing, dismissing the claims as baseless, misleading and politically motivated.

In a statement issued on Friday, Malami said he was compelled to respond after a publication suggested that he and several others had connections to persons described as terror suspects or alleged financiers.

Malami described the claims as “unfounded, unfair and contrary to both my record in public office and objective facts.”

The former minister stressed that he had never been accused, invited, interrogated or investigated by any security, law-enforcement or intelligence agency within or outside Nigeria for terrorism financing or any related offence.

He said: “I state clearly and unequivocally that I have never at any time been accused, invited, interrogated, investigated or charged by any security, law-enforcement, regulatory or intelligence agency—within or outside Nigeria—in respect of terrorism financing or any related offence.”

Malami noted that even the retired military officer cited as the principal source of the publication admitted that he did not accuse Malami or the other individuals of financing terrorism, but merely referenced vague “business” or “institutional” connections allegedly linked to some suspects.

He said the publication misrepresented this clarification and was politically exploited to create damaging insinuations about him.

Malami warned that normal professional or institutional engagements must not be misconstrued as evidence of supporting terrorism.

“To suggest that lawful professional or institutional engagements can be read as evidence of terrorism financing is both mischievous and unjust,” he said.

Highlighting his record, Malami listed several anti–money laundering and counter-terrorism reforms spearheaded during his tenure, including:

Establishment of the Nigerian Financial Intelligence Unit (NFIU) as an independent entity

Enactment of the Money Laundering (Prevention and Prohibition) Act, 2022

Enactment of the Terrorism (Prevention and Prohibition) Act, 2022

He noted that improved inter-agency coordination under these laws contributed to Nigeria’s removal from the Financial Action Task Force (FATF) grey list.

“During my tenure, I worked to strengthen—not weaken—Nigeria’s legal and institutional framework against money laundering and the financing of terrorism,” he said.

Malami urged the media to exercise caution when reporting on sensitive national security issues, warning that careless publications can damage reputations and undermine confidence in state institutions.

He reaffirmed his commitment to the rule of law and Nigeria’s international obligations, adding that he reserves the right to seek redress against any publication that misrepresents his role in the fight against terrorism financing.

News

Otuaro Pledges To Expand PAP Scholarship As Beneficiaries Bag Master’s Degrees From UK Varsities

Published

1 day ago

December 5, 2025

Editor

Administrator of the Presidential Amnesty Programme (PAP), Dr. Dennis Otuaro, has expressed his unwavering commitment to expanding the PAP scholarship scheme.

The PAP boss made the pledge at a graduation reception for nine students who were awarded foreign post-graduate scholarships by PAP in universities in the United Kingdom.

A statement by his Special Assistant on Media, Mr Igoniko Oduma, said the successful scholars are the first graduates in the offshore post-graduate scholarship deployment to UK institutions by the PAP Administrator, Dr Dennis Otuaro, for the 2024-2025 academic session.

According to the statement, they graduated from the Anglia Ruskin University, University of Dundee and The University of Law with master’s degrees in cyber security, data science and engineering, law, construction and civil engineering management, project management, and ICT.

Otuaro disclosed in the statement that 711 undergraduate and post-graduate scholarship beneficiaries are expected to graduate from universities within Nigeria this year.

According to Otuaro, the expansion of the scholarship scheme is aimed at creating more opportunities for indigent students of Niger Delta extraction to access higher education with a view to closing the human capital development gap in the region.

Otuaro said it was for this reason he deployed 3800 beneficiaries in-country in the 2024-2025 academic year, and increased the figure to 3900 in the 2025-2026 academic session with 200 for foreign scholarships.

He said under his administration, 7700 students have been so far deployed for the PAP scholarship scheme within Nigeria in less than two years.

According to him, aince he took over, he has deployed 162 students from the region for post-graduate programmes in targeted disciplines in the UK universities.

According to him, this is in conformity with the Renewed Hope Agenda of President Bola Tinubu for the Niger Delta, who has given unprecedented support to the PAP because of his sincere love for the area.

The PAP boss said, “Our decision aligns with the Renewed Hope Agenda of His Excellency, President Bola Ahmed Tinubu GCFR for the Niger Delta. We will continue to create more higher educational opportunities for students from indigent backgrounds in our region.

“We are also deepening the implementation of the programme’s mandate in informal education and other areas for the sustainable peace and socio-economic advancement of the region.”

Otuaro, who congratulated the master’s graduates on their successful graduation, stressed that they completed their programmes in record time which shows the seriousness they had put into their studies.

He said they have justified the Federal Government’s investment in their education with their successful graduation, and urged other beneficiaries not to be distracted in their academic pursuits.

“We congratulate these scholars on their successful graduation. It shows that they took their studies seriously. That is what we demand of every scholarship beneficiary, whether at the undergraduate or post-graduate level”, Otuaro said.