Mr Babajide Sanwo-Olu’s administration in Lagos State on Friday said that the 2022 budget deficit of ₦521.275 billion is expected to be funded through the ₦1.237 trillion targeted revenue.
The State Commissioner for Economic Planning and Budget, Mr. Sam Egube disclosed this during a media briefing on the analysis of the Year 2022 Budget, christened: “Budget of Consolidation,’’ at the State Secretariat Alausa, said the State hopes to amass N980bn through Internally Generated Revenue to finance the budget, with the state Internal Revenue Service expected to generate 73.5% (N599,04bn) while about 19.2% (N156.65bn) is expected to be generated by other MDAs of government.
It will be recalled that on Wednesday, November 24, 2021, a proposed Y2022 Appropriation Bill of N1.388 trillion was presented by the state Governor, Babajide Sanwo-Olu to the Lagos State House of Assembly for consideration and assent.
After a very rigorous bilateral engagement with the respective Ministries, Departments and agencies, MDAs, an amended Bill of ₦1.758 trillion was subsequently passed on Wednesday, December 29, 2021, by the State House of Assembly and was signed into law by the Governor on Friday, December 32, 2021.
According to Egube, the revised Y2021 Budget of ₦1.257 trillion had total revenue of ₦984.573 billion and deficit financing of ₦271.994 billion; the Capital to Recurrent ratio stood at 59:41 that is, Capital Expenditure of ₦743.224 billion and a Recurrent Expenditure of ₦513.343billion.
As of November 30, 2021, the budget posted a performance of 73 per cent, saying, “Our Revenue Performance was 75 per cent, while Capital and Recurrent Expenditure performed at 65 per cent and 83 per cent respectively.”
He said: “The Y2022 budget, which we have christened the “Budget of Consolidation” is a landmark budget in the history of the state both in its size and texture. The approved Y2022 Budget of ₦1.758 trillion made up of ₦1.167 trillion Capital Expenditure and ₦591.281billion Recurrent Expenditure, resulting in a Capital to Recurrent ratio of 66:34, is strongly in favour of Capital Expenditure.
“Total Revenue is estimated at ₦1.237 trillion while deficit funding requirement is ₦521.275 billion, which at 21 per cent of debt service to total revenue is within the fiscal sustainability benchmarks of 40 per cent.
“Our overriding budget objective to achieve a budget of consolidation is: Substantially, complete existing and ongoing infrastructure project; infrastructure is essential to state-wide economic and social development.
“We have increased our investment in infrastructure by 86 per cent over the prior year budget to N619 billion representing 35 per cent of the entire budget size.
“Prioritization of existing, contractor funded (front-loaded) infrastructure projects are completion of Eight Stadia across the Five Ibile divisions of Lagos State, to facilitate youth development, engagement and community sports, construction and rehabilitation of schools across the state to significantly improve access to quality education, construction of the 6-lane reinforced concrete Lekki Epe Expressway from Eleko junction to Epe T-junction.
“This strategic project is aimed at accommodating the increasingly huge and heavy vehicular movement in the Lekki Epe axis especially when the deep seaport and the Dangote refineries et al comes into operation, procurement of 62 fire vehicles to improve fire response service all over Lagos by further decentralization of operating locations all over the state. This will strengthen our emergency response capability.
“Construction of 130 bed New Massey ultra-modern and fit for purpose Paediatric programmed and emergency general hospital. We believe that when this hospital, which will be located at Lagos Island is completed, it will be the largest specialist children hospital in sub- Saharan Africa.
“Construction of the Opebi Link bridge to Maryland that will improve significantly travel time and alternative route options the axis. All these projects are contractor funded, with structures that provide very beneficial payment terms that give the state upfront value (front-loaded) ahead of payments; thereby increasing the sustainability benefits to the state.”
On human capital development and social interventions, Egube said, “the human capital continues to be an area of deep interest to the state. We believe that the opportunities in the state can only be converted to value by a population that is healthy, skilled and inclusive.
“This year’s budget increased investment by 30 per cent to N325 billion in Y2022, about 18 per cent of the total budget size.
“Under our human capital development initiatives, the Y2022 budget increased the allocation to the education family by 25 per cent to N173billion representing 10 per cent of the budget size while the health family received an allocation of N132 billion representing 35 per cent increase over prior year budget and 8 per cent of the current budget size.”
On food security, he said, “we have continued since the outbreak of COVID 19 to increase our investment and attention on food security. We have completed the 5-year Agric road map to provide support to our farmers, create food banks and improve our food systems generally.
“In line with this posture, we have increased in Y2022 our budget to Agric by 34 per cent to N27 billion. We intend to complete the Imota rice mill, which when completed will have a capacity to produce 2.6 million 50 kilogramme bags of rice per annum and employ over 350,000 people both directly and indirectly. In addition to this, we will be training and empowering over 40,000 women and youth in agric business.”
On technology, Egbube said: “Lagos intends to be the technology hub for Africa, a major incubation and acceleration destination for technology solutions. We have provided an increase in technology investment of 27 per cent over the Y2021 budget to N30 billion. We will continue to invest in strengthening our intelligence gathering/capacity-building capabilities together with improving the ease of doing business through the SmartCity project, The Lagos new Data Center project, Eko Excel project and the Oracle upgrade project.
“We will continue implementing in collaboration with private sector partners existing initiatives like the 3,000 broadband fibre duct infrastructure project, Knowledge Innovation, Technology, and Entrepreneurship (KITE) Campus development at Yaba in addition to the Lagos Science Research and Innovation council (LASRIC). All this will strengthen our aspiration to be the technology hub for Africa.”
On youth development, he said given the demography of Lagos, investment in technology, the 8 stadia, Agriculture, Entertainment and Tourism are largely targeted at our youth development and engagement. We believe that Lagos has one of the most innovative youth populations in Africa, which we intend to continue to cultivate.
The Commissioner noted that there was a difference between the total budget size presented by the Executive and the final size passed by the Legislature adding that the difference was largely accounted for by the decision during the bilateral meeting with the MDAs to further accelerate already existing projects to bring them to substantial closure.
He listed some of the projects under the contractor financed programs to include: 24km Red line rail from Agbado to Oyingbo (phase 1) to includes 10 bridges/overpasses, 13 pedestrian bridges and 8 train stations while the 13kilomtre Blue line rail from Mile 2 to Marina with sea crossing (phase 1), the 20 km Lagos Badagry Expressway to Okokomaiko, both project estimated to gulp N153 billion for the completion of the first phase.
Others include Expanded Drainage construction, rehabilitation, maintenance program, channelization of waterways among other infrastructure projects.
Present at the briefing were: Commissioner for Information and Strategy, Gbenga Omotoso, Commissioner for Transportation, Dr. Fredric Oladeinde, Commissioner for Education, Mrs. Folashade Adefisayo, Commissioner for Energy and Mineral Resources, Mr Lere Odusote, Special Adviser to the Governor on Works and Infrastructure, Engr. Aramide Adeyoye, among others.
Packaged by Alaba Igbaroola
