The Federal Government has proposed to spend N6.04 billion on personnel costs for Ajaokuta Steel Company Limited in the 2026 fiscal year, despite the steel complex remaining largely non-operational over four decades since its inception.
Data from the 2026 Appropriation Bill shows that the company received a total allocation of N6.69 billion, with personnel expenses accounting for over 90 per cent of the provision.
Of this, N4.79 billion is earmarked for salaries and wages, while N1.25 billion is set aside for allowances and statutory contributions, including employer pension contributions (N479.42 million), NHIS payments (N239.71 million), employees’ compensation insurance (N59.82 million), and regular allowances totaling N468.9 million.
The budget highlights a stark imbalance between recurrent and capital expenditure, with N6.28 billion designated for recurrent spending and only N410.8 million for capital investment.
Within the capital allocation, minor items such as computers, printers, and security equipment take N56.4 million, construction and facilities N129.2 million, and rehabilitation and repairs N225.2 million, primarily for electricity works and office buildings.
The proposed budget continues a long-standing trend, with personnel costs dominating spending while capital investment toward actual steel production remains minimal.
Personnel costs rose from N4.29 billion in 2024 to N6.21 billion in 2025, and the 2026 allocation of N6.04 billion reflects only a marginal 2.7 per cent decrease from last year, despite the company generating zero independent revenue.
Beyond the company’s internal budget, the 2026 Appropriation Bill includes provisions under the Federal Ministry of Steel Development for revival-related activities, allocating N150.99 million for revitalisation projects and N1.06 billion for project preparation, including feasibility studies, Environmental and Social Impact Assessments, and financial modelling. However, these funds remain focused on planning rather than physical recommissioning.
Meanwhile, Ajaokuta continues to fund constituency-style projects, such as solar street lighting, water facilities, road repairs, security lighting, and grants to market women and youths, none of which contribute to reviving steel production or industrial capacity.
The 2026 budget reinforces Ajaokuta’s long-standing role as a non-producing public enterprise, sustained largely by salary payments rather than industrial activity, highlighting the persistent challenge of reviving Nigeria’s flagship steel complex.