Kano Govt proposes over N1trn 2026 budget despite not reaching N100bn annual IGR in over 4 years
By Aminu Abubakar
The Kano State Government has proposed over N1 trillion budget for the 2026 fiscal year, even though the state has not generated up to N100 billion in Internally Generated Revenue (IGR) annually in more than four years, according to official financial records.
The development has triggered fresh conversations about the sustainability of the state’s fiscal direction, its widening debt burden, and the practicality of deploying a trillion-naira spending plan without a significant and consistent rise in domestic revenue.
IGR Trends Fall Short of N100bn Benchmark
An analysis of Kano State’s revenue trajectory through the budget performance documents over the last four fiscal years shows that IGR performance has remained far lower than N100 billion, which is 10% of the over N1 Trillion now proposed as total expenditure for the 2026 fiscal year.
The state’s IGR has fluctuated between N37 billion and N59 billion in this period.
In 2021, the state generated N40.4 billion in IGR against a total budget of N177.9 billion.
In 2022, IGR declined to N37.4 billion while the approved budget increased to N221.2 billion.
By 2023, IGR grew modestly to N41.1 billion as the government expanded its budget to N268.1 billion.
In 2024, the state earned N59.4 billion, while the approved budget climbed sharply to N437.7 billion.
For 2025, the state had realised N71.8 billion as of September—still not enough to break the N100 billion annual threshold. The total approved expenditure for the 2025 fiscal year stands at N719 billion, official budget documents show. This would mean that the state as of September 2025, has generated internally only 10% of the approved budget estimates.
Despite these modest inflows, the government has now put forward a N1 trillion budget plan for 2026, representing the most ambitious financial proposal in the state’s history.
A Trillion-Naira Budget: Ambition or Overreach?
The implied leap from a N437.7 billion budget in 2024 to a proposed over N1 trillion for 2026 has raised questions about fiscal realism and long-term planning. Analysts expect that the proposal will generate renewed debate among policymakers, civil society, and economists regarding Kano’s actual revenue capacity and how the state intends to sustain such a massive budget expansion without proportionate growth in IGR.
Nevertheless, government officials argue that the plan is grounded in improved revenue systems, better administrative controls, and a renewed push to block leakages.
The state has relied on Federal allocations and borrowings to finance previous budgets that were far less than N1 Trillion.
Governor Yusuf’s Justification for the Massive Budget
Governor Abba Yusuf earlier disclosed that his administration is finalising the state’s first-ever trillion-naira budget for the 2026 financial year. This was revealed in a statement issued by his spokesperson, Sunusi Dawakin-Tofa, who noted that the governor made the remarks while opening the Second Special Executive Council Meeting convened to deliberate on the budget proposals ahead of their submission to the Kano State House of Assembly.
The governor attributed the unprecedented increase to improvements in internal revenue collection and administrative reforms aimed at preventing leakages.
“We have strengthened internal revenue mechanisms and sealed leakages, enabling us to plan boldly for transformative projects in 2026,” he said.
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According to Yusuf, the proposed 2026 budget will emphasise investments in housing, agriculture, education, healthcare, and support for small and medium-scale enterprises. He explained that the objective is to stimulate economic activity, generate employment, and create sustainable livelihoods for residents of the state.
Debt Sustainability Concerns Deepen
A review of Kano State’s Debt Sustainability Report by SolaceBase reveals that the state government intends to borrow N55 billion between 2025 and 2026. This comes amid growing concerns over rising debt levels and widespread calls for a shift toward more sustainable, non-debt revenue sources.
According to the report, the state has no plan to secure external loans in 2025. Instead, it will rely entirely on domestic borrowing, with N30.4 billion expected to be sourced locally.
In 2026, however, the borrowing structure changes to include N14 billion in domestic loans and N10.8 billion in external loans, bringing total borrowing for that year to N24.8 billion.
Rising Borrowing Trend Amid Worsening Debt Burden
The N30.4 billion projected borrowing for 2025 exceeds the N25.065 billion allocated for borrowing in 2024, pointing to a trend of increasing dependence on debt to fund government activities.
As of September 2024, Kano State’s domestic debt stood at N61.9 billion, according to the Debt Management Office (DMO). The external debt stock as of June 2024 was $123.393 million. Financial analysts warn that as the state continues to borrow heavily without a proportional increase in revenue, debt sustainability may become more challenging, especially under unpredictable economic conditions.
Debt Servicing Costs Surge Dramatically
The state’s rising debt has also resulted in a steep increase in debt servicing obligations.
In 2024, Kano State’s debt servicing cost rose to N69.8 billion.
In 2023, the state spent N9.5 billion on debt servicing.
In 2022, the figure stood at N12.7 billion.
In 2021, Kano spent N3.7 billion on servicing existing debts.
This sharp escalation highlights the growing financial pressure on the state, raising concerns that a significant share of government revenue could continue to be diverted toward servicing debt instead of funding development projects.
Development Challenges Persist Despite Rising Budgets
Despite a steady increase in budget sizes and borrowing, Kano continues to face deep-rooted developmental challenges.
An estimated 4.6 million adults in the state live in poverty.
About 35 percent of children do not have access to education.
More than half of households—51 percent—lack access to sanitary facilities.
Additionally, 31 percent of households do not have access to clean drinking water, according to the National Bureau of Statistics’ multidimensional poverty index.
Critics argue that without structural reforms, enhanced revenue mobilisation, improved transparency, and better prioritisation of critical sectors, even a trillion-naira budget may not adequately address Kano’s ongoing development deficits.
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