The payments were broken into N1.6 billion for “Domestic Interest/discount” and another N58 billion paid for “Domestic Principal.”
A review of the budget performance documents of Kano State has shown that a sum of N60billion was spent by the state on public debt charges between April and June 2024.
The N60billion was spent in the second quarter and this is despite the fact that only N4.6 billion was budgeted to be spent by the state on debt servicing for the whole of 2024.
The payments were broken into N1.6 billion for “Domestic Interest/discount” and another N58 billion paid for “Domestic Principal.”
In same period, only N628 million was spent on construction/provision of public schools, provision of roads took N7.1 billion, both of whom are far lesser than the expenditure on debt servicing.
The expenses on debt servicing is also four times its internally generated revenue, given that only N14 billion was generated for the first six months of the year and N60 billion was spent on debt servicing.
At the ministerial level, the capital expenditure for ministry of works and housing is estimated at N18.6 billion for the half year 2024, water resources is N4.2billion.
The total capital expenditure for the economic sector is N36.8billion which is far lesser than the N60billion for debt servicing.
The N60billion for debt servicing is also more than the N42 billion spent by the state to pay salaries (personnel cost), for the first six months of 2024.
It is also more than the total N42 billion spent on capital expenditure for the first six months of the year.
Kano expenditure on debt servicing denies it the provision of critical infrastructure such as water, which it has faced challenges with over time especially in the area of scarcity.
Experts have argued that there is an urgent need for states to diversify their revenue sources and curb reliance on loans as a source of revenue.
Reliance on loans by states have meant that they pile up high debt servicing figures, a situation that has usually led to dwindling revenue.
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