The State of Our States: The Cost of Poor Governance

By Nurudeen O. Alimi

For all the noise about record budgets, Nigeria remains a country where prosperity sits in government ledgers, not in people’s lives.

Across thirty-six states and the Federal Capital Territory, public spending has climbed sharply, yet poverty continues to deepen. The BudgIT State of the States 2025 Report shows that while total state expenditure exceeded ₦15 trillion in 2024, more than 61 percent of Nigerians now live below the national poverty line.

If money alone could buy progress, we should all be celebrating. But the numbers tell a crueller story: Nigeria’s problem is not revenue, it is results.

 

Billions Spent, Little to Show

Between 2015 and 2024, combined federal and state budgets grew by over 300 percent. Recurrent spending rose fastest, capital projects stagnated, and human development indicators flatlined.

Infant mortality remains among the highest in Africa, learning outcomes continue to decline, and unemployment hovers around 33 percent.

Even as FAAC and IGR figures swell, too many citizens face a daily trade-off between food, fuel, and school fees.

 

When Governance Becomes Accounting

BudgIT’s Fiscal Performance Index ranks states not by size or political clout, but by how efficiently they convert public funds into tangible welfare outcomes. It is a sobering mirror:

• Top Performers (High Governance Quality) – Anambra, Kwara, Abia, Ekiti, Edo, Lagos, Nasarawa, Ogun

These states combine fiscal discipline with modest social progress. They publish budgets, track projects, and sustain health or education initiatives that citizens can see.
They spend to serve, not to survive.

• Mid-Tier Performers (Mixed Governance Quality) – Oyo, Ondo, Delta, Akwa Ibom, Enugu, Cross River, Kaduna, Osun, Plateau, FCT

Their budgets are large, but results inconsistent. Transparency is improving, yet capital projects often stall before completion.
They spend to be seen, not to sustain.

• Low Performers (Poor Governance Quality) – Bayelsa, Kogi, Niger, Zamfara, Kebbi, Taraba, Borno, Yobe, Adamawa, Gombe, Sokoto, Katsina

Despite generous FAAC inflows, poverty rates remain extreme. Weak institutions and opaque accounts mean resources rarely reach citizens.
They spend, but people stay poor.

 

The Poverty Paradox

How does a state spend billions and still record higher poverty?

The answer lies in inefficiency, leakages, and misplaced priorities. Much of the money meant for health, education, and rural infrastructure disappears into overheads or politically inflated contracts.

Take two oil-rich states—Bayelsa and Delta—which received over ₦2 trillion combined in 2024. Yet both rank among the ten poorest in welfare outcomes. Meanwhile, smaller economies like Kwara and Ekiti deliver better health indices with leaner budgets.

This paradox shows that good governance is not about how much is available, but how much is accountable.

 

 

 

The Federal Story: Rich Centre, Poor Citizens

At the federal level, the pattern repeats. Abuja’s social-investment budgets—cash transfers, youth funds, palliatives—often lack transparency. While trillions are announced, independent verification of beneficiaries remains weak.

The result is a growing trust deficit: citizens no longer believe public spending will improve their welfare. The promise of inclusion fades beneath layers of bureaucracy and politics.

 

What Makes a Government Truly Perform

Governance quality is measurable through three intertwined metrics:

1. Fiscal Discipline: How effectively resources are managed.
2. Transparency: How openly those resources are reported and audited.
3. Human Impact: How directly they improve lives—lower poverty, higher literacy, healthier families.

A government that excels in the first two but fails in the third has not succeeded; it has merely managed itself well.

 

The Human Cost of Misgovernance

Poor governance is not abstract—it lives in overcrowded classrooms, unpaid teachers, and clinics without medicine.

When public money feeds bureaucracy instead of building opportunity, citizens lose trust, and democracy becomes transactional. Poverty becomes generational not because people are lazy, but because their leaders are careless.

 

Signs of Hope

Some states are quietly rewriting the story.

• Anambra has linked budget planning to measurable SDG targets.
• Kwara publishes quarterly budget performance reports and tracks social investments online.
• Lagos integrates open-data dashboards to monitor education and health outcomes.
• Ekiti and Abia have adopted gender-responsive budgeting for equitable impact.

These may seem small steps, but they signal a cultural shift—from spending for show to spending for society.

 

The Reform Roadmap

To turn fiscal efficiency into human prosperity, three things must happen:

1. Tie Budgets to Outcomes:
   Every naira spent should link to measurable welfare targets—jobs created, lives improved, literacy rates raised.
2. Open the Books:
   All levels of government should publish real-time expenditure and poverty-reduction data. Secrecy sustains mediocrity; transparency breeds trust.
3. Reward Performance:
   Federal grants and development loans should prioritise states that demonstrate tangible social impact, not just balanced spreadsheets.

 

Final Reflection

Governance is not about managing accounts; it is about changing lives.

Nigeria’s billions mean nothing if citizens still queue for water and hospitals without drugs. Until governments—federal and state alike—begin to measure success by human progress, not financial performance, poverty will remain the nation’s most honest auditor.

Because at the end of every fiscal year, the truest budget report is not written in numbers—it’s written in the faces of the people.