Rivers State has again led other states in the country in BudgIT’s 2022 fiscal performance ranking, according to a press release issued yesterday by the civic-tech organisation. The statement said that this year’s edition of BudgIT’s annual States of States report titled, “Sustainable Governance Reforms for a New Era,” shows that “Rivers State maintained its overall fiscal performance position, ranking 1st, just like it did in 2020 and 2021.” The report, which is BudgIT’s signature analysis, assesses and ranks the fiscal performance of all 36 states, from the most sustainable to the least sustainable. According to the statement: “For the 2022 edition, all 36 states were ranked using five metrics: Index A examines states’ ability to meet Operating Expenses (Recurrent Expenditure) with only their Internally Generated Revenue.
Index A1 looks at the percentage year-on- year growth of each state’s Internally Generated Revenue. “Index B reviews states’ ability to cover all operating expenses and loan repayment obligations with their Total Revenue (Internally Generated Revenue + Statutory Transfers + Aids and Grants) without resorting to borrowing.
“Index C estimates the debt sustainability of the states using four major Indicators- debt as a % of GDP; debt as a % of revenue; debt service as a % of revenue; personnel cost as a % of revenue. “ Index D evaluates the degree to which each State is prioritising capital expenditure with respect to their operating expenses (recurrent expenditure).” The press release said that while two states, Kaduna and Cross River, made it to the top five on the overall fiscal performance ranking, Yobe State dropped to the bottom five having fallen 13 places from 21st in 2021 to the 34th position in 2022.
Furthermore, the statement indicates that on Index A, just two States (Lagos and Rivers) generated enough revenues internally to take care of their operating expenses. “Comparatively, the operating expenses of Yobe and Bayelsa (the least ranked states on index A) was more than seven times the revenues generated by both states Internally, reinforcing the heavy reliance on federal transfers and budget support to fund their budgets.
