Analysis of 2013 Agricultural Sector Budget

By Esther Agbon & Constance Okeke

Background

• Agriculture spending is critical to reducing poverty and promoting development in Nigeria

• Small holder farmers (2ha) produce over 90% of the Nations food

• Agriculture employs about 70% of the population

• Successive governments have failed to prioritize agriculture

Background

• Agriculture is the largest contributor to GDP –over 40%

• Real GDP growth in terms of output is 3.7% as compared to 5.95% in 2011, (NBS,Q2, 2012)

Major Challenges

• Low access to extension services, credit and input

• Standard is 1:500 extension worker farmer ratio• In Nigeria extension worker to farmer ratio is

1:1,500 households• Low access to land - 38% of farm household

own no land, about 25% own 1ha or less

Challenges

• Only about 40,000 ha are irrigated which is less than 1% of land actually in use

• Crop yields are far below their potentials despite available arable land

• In Nigeria a ha yields only 4 tonnes compared to other countries with 13 -14 tonnes/ha of agricultural products

• Loss of farm lands, produce, livelihoods due to climate change

Women in Agriculture

• Small holder farmers face even greater challenges

• Form 60 – 80% of the labour force• Carry out 50% of husbandry and 60% of food

processing• They produce both food and cash crops and

perform multiple roles on and off farm• Work on their own plots as well as others as

unpaid or paid labourers

Government Policies

• policies and plans to increase productivity include; Agriculture transformation agenda, CAADP, MDG 1, vision 20:2020

• Federal and state level programs on fertilizer research, credit loans etc

• Despite these, budgetary allocations and actual spending on agric key services are grossly inadequate to reduce poverty

Focus of analysis

• Government spending on key areas such as - Women farmers- Input (seeds, fertilizer, chemicals etc) - Extension services- Credit- Research and development

Funding Trend

• Funding for agriculture has been on the downward trend since 2009

6.2

3.6

1.9 1.66 1.7

6.2

3.6

1.9 1.66 1.7

% % % % %

2009 2010 2011 2012 2013

Agric funding trend

Findings

• Total Agric budget 1.7% of 4.920t amounting to N81,410b

Other DAs42%

Main Min58%

Total Agric budget

Capital85%

Recurrent15%

Main Ministry

General Observations

• The budget lines especially for the main ministry are very ambiguous – lacks details

• Most of the budget items do not contain intervention locations as with some of the DAs

• Climate change gets N60m – lacks proper descriptionIs it for adaptation? Mitigation? or ………….

• Repetition of items such as seeds and fertilizer with no description on location, specification, quantity poses challenges for monitoring

Provision for Women

• No clear budget line for women farmers except for training of 3000 women in value chain worth N100 million

• Amounts to N33,000 per head including other costs• Starter packs for 2500 women worth 87.5 million• Compared to the number of women in the sector

the amount and target is insignificant• Contradicts the policy thrust which presume focus

on women

Farm Input and Extension Services

• Fertilizer, seeds, fungicides repeated severally with different budget costs

• extension service gets N12m for capacity building – how many people how many days?

• while a feasibility study for a meat processing and packaging gets N200m

• Farmer field schools get paltry N53m• The quality of allocations are not people driven

Credit

• Provisions for access to credit is funded by the ongoing MDG1 projects

- Access to credit - N250,000,000- Access to credit – N900,000,000• Question is who, where and how many people

will benefit from this loan?

Research and Development

• The agencies and departments in agric ministry are mainly research institutes

• Only 42% of the total budget will be shared among them

• Main ministry spends N100,000,000 for R&D• Question is why are the research Institutes so

poorly funded?• Obvious the institutes will not fare well in 2013

Research and Development

0

500,000,000

1,000,000,000

1,500,000,000

2,000,000,000

2,500,000,000

3,000,000,000

1. National Centre for Agric Mechanisation -

Ilorin

2. Agric Research & Management Institute -

Ilorin

3. National Root Crops Research Institute -

Umudike

4. Natioanl Institute for Oil Palm Research

(NIFOR) Benin

5. Institute of Agriculture Research - Zaria

Capital vs recurrent

Recurrent

Capital

Total

Bloated/Wasteful Overheads

• Office construction for the main ministry was duplicated severally with different costs.

• Construction/provision of office building – N1.6m• Fencing and engineering design of Hqtrs –N620m• Remodelling of the same Hqtrs – N100m• Processing zones repeated

6 times @N200m each, lacksdescription and location

Recommendations

• Federal Government and states should progressively fund agric to reach the 10% Maputo agreement

• The allocations must be qualitative and people centred

• Increase massively, spending on extension services – recruitment & training, credit and inputs

• Sincerely prioritize credit and input for women farmers in the budget

Recommendations

• Refocus the fertilizer subsidy programme and agric research services to adequately target women considering their role in the sector

• Make agric budgets more descriptive and clear to aid monitoring

• Ensure participation of farmers, CSO and other stakeholders in annual budget process to aid design of agric programmes and projects

Thank you for Listening