Ekiti, state where impunity reigns in misappropriation of public funds

When local authorities fail to adhere to their budgets without due process, they undermine public trust and raise concerns about transparency and accountability in their financial management. In the long run, this practice will ultimately destabilise the macroeconomic stability of any state, leading to adverse effects on its development prospects

 

By Emmanuel Ukudolo, Ishaya Ibrahim, Funmi Falobi and Seyi Babalola

 

ADO EKITI, Nigeria  -There is widespread impunity in Ekiti State with misappropriation of public funds. Government officials seem to have made it a habit of dipping their hands into the public purse and spending at will without recourse to the budget in five Local governments. 

Auditor General of Local Governments in Ekiti State, Dr. Iyadunni Victoria Oke made allusion to  these breaches in the audit certificate she presented on Ekiti West Local Government, Ijero Local Government, Ikere Local government, Ilejemeje Local Government and Irepodun/Ifelodun Local Government, where she posited that her observations reflect a true and fair view of the local governments as at 31st, December, 2022.

Our investigations into the books of Ekiti West Local Government reveal that these breaches occurred in overhead cost, transfer and purchase of assets, overshooting the budget by almost half of the amount budgeted, without a supplementary approval by the local government approving authorities.

For instance in Overhead Cost, the total budget for the year ended 2022 was N81, 480, 000 but Ekiti West Local Government spent N122, 931, 602.00, exceeding the budget by a total of N41, 451, 602.00. 

Items captured in the Overhead Cost include maintenance services, transport,  grant, SUBEB Overhead,  fuel and lubricants,  training and human development, field overhead expenses, professional services,  miscellaneous expenses,  material supplies, Iyaloja Imprest and general utility.

Under transfer to other government entities, the total budget for the year 2022 was  N1,025,000,000 but what was spent without supplementary approval was N1,577,252,389.63, overshooting the year 2022 budget by  N552, 252, 389.63. As usual there is no supplementary budget to approve the excess based on the impunity which seems to have eaten deep into Ekiti West Local Government.

Items captured under transfer include pension and gratuity,  SUBEB staff salary,  Security fund,  Parastatals and agencies, Peace Corps, Ekameta LCDA, Okemesi /Ido-Ile LCDA and  Special Rates with JAAC.

For Purchase of Assets, the total  appropriation for the Year  was  N74,000,000 but what was spent without budgetary approval was N71,031, 304.90, again exceeding the budget by  N2, 968, 695.10 kobo.

Items covered under this subhead include  Land, building, infrastructure,  motor vehicles, plant and machinery, office equipment, furniture and fittings. 

This same trend was replicated in Ijero Local Government where budget for overhead cost was N74, 242,000.00  whereas what was spent without budgetary approval was N182, 020, 858.04, surpassing the budget by N107, 778, 858.04 kobo. 

IYALOJA

The trend continued in Ikere Local government where no amount was captured in the 2022 budget for Iyaloja, yet the local government paid a whopping N155, 256, 935.23 to the Iyaloja of the state. 

To be specific, N300,000 was paid to the Iyaloja as stipend for 12 months, N78, 162, 600 was paid for Iyaloja’s Logistic Security and another N76, 794,335.23 kobo was paid to the same  Iyaloja as Assist/workshop claims without being captured in the 2022  budget. 

Ikere also overshot the budget for the year 2022  in transfer to other government agencies.  For instance, the total budget for transfer in the affected year was N414, 358,322, whereas what was spent was N1, 144,  077, 709.55, exceeding the budget by N729, 719, 387.55 kobo almost N1 billion.  In fact, the practice of overshooting the budget was carried over from the year ended 2021.

In fact the Ikere Local Government is so rotten that they carried their act of impunity into the arena of allowances too. For the year 2022, the budget captured N11, 500,000.00 for allowances but government officials spent N91, 179, 621.79 on allowances, exceeding what was provided for in the budget by N79, 679, 621.79 kobo. 

Ilejemeje Local Government is not left out in the mess pervading almost all the local  governments in Ekiti State. For instance, under transfer to other government agencies, the Local government budgeted N543, 300, 000 for transfer to other government agencies, whereas  what was spent out of budgetary approval was N970, 836,  332.94 kobo, overreaching appropriation for the year by N348,  956, 892.52 kobo.

The cankerworm also spilled over to Irepodun/Ifelodun Local Government under the subhead of Salary payment for the year ended December 31, 2022.  The Local government  budgeted N1,158, 724, 854.72 kobo, whereas it spent N 1,818, 764, 568.38 kobo, consequently spending  a whooping N660,039, 713.66 without budgetary approvals. 

The same holds true for social contributions, where the sum of N6, 550,000 was approved for the local government but as a result of inherent impunity, officials of the local government  spent N56,512, 399.11 kobo without any supplementary consent.

The same level of executive lawlessness was exhibited in overhead cost, where  the total budget  approved for the local government under the subhead was N60,  290, 000, whereas officials of the local government went ahead to spend N101, 471, 297.67 Kobo, exceeding what is approved by  N41, 181, 297.67 kobo. 

This financial lawlessness was also carried further to the subhead, transfer of other government entities, where N530, 000,000 was approved in the budget but what was spent for the year was N762,  718, 354.54 kobo, exceeding approval by N68, 285, 303.45 kobo. The same trend holds  true for allowance and others

Reacting to this  ugly development, Chairman, Institute of Chartered Accountants of Nigeria (ICAN) in Ekiti State, Mrs. Funmi Alonge, said the local government officers involved should be called to explain what happened if there is no virement.

“If there is no virement, then they should be called to explain. Ideally, they should not have spent beyond their budgetary allocation,” she said in a telephone interview with one of our team members.  

She said although inflationary trends could sometimes lead to spending beyond budgetary allocation, but that when such happens, officers who dispense such funds must provide a clear explanation for the gap. 

 “Most times, the amount allocated and funds expected do not match and the cost of things are also increasing. For instance, if you budgeted N3, 000 on fueling before, look at the cost of fuel now. If you budgeted N189 per litre, look at it today. So, the amount budgeted will be at variance because the cost of things are escalating every day, and unfortunately, the revenue remains the same. But there should be a system for explanation. Once something is very wide like that, it calls for questioning. The officer in-charge should have been called to explain the reason for the gap.” 

In her reaction, Policy and Research Officer at Corporate Accountability, Advocacy and Public Participation Africa (CAPPA), Zikora Ibeh says the practice of local governments in Nigeria spending beyond their budgetary allocations indicates a deficiency in due process and weak financial management and oversight structures. 

“This pattern poses a significant threat to the financial health of any state and fosters fiscal indiscipline, leading to financial mismanagement, misappropriation, and the potential rise in public debt as governments may need to borrow to cover deficits. This prevalent issue across multiple local governments in the country is also the reason why local authorities are unable to finance capital projects, undermining economic development and effective governance.

According to her, when local authorities fail to adhere to their budgets without due process, they undermine public trust and raise concerns about transparency and accountability in their financial management.

“ In the long run, this practice will ultimately destabilise the macroeconomic stability of any state, leading to adverse effects on its development prospects.”