Lagos State Governor, Mr Babajide Sanwo-Olu on Friday presented a budget size of N1.168trillion to the State House of Assembly.
The budget which was christened ‘Awakening to a greater Lagos,’ has deficit of 97.5bn which would be financed through internal and external borrowings.
According to the Governor, the capital would be 773bn while recurrent would stand at 441.8bn representing 62:38 ratio respectively.
The budget brekadown showed that infrastructure got the lion share 115bn followed by education that got 48bn.
He explained further that he would ensure adequate performance of the budget before December 2020, saying; “I’m energized through your cillective effort to take decision. It is to imagine a new Lagos and better Lagos.”
“Speaker and Honourable Members of the House, I will now move to the highlights of the 2020
The budget is fully consistent with our THEMES agenda, and gives priority to the completion of ongoing projects.
“The Proposed Budget Size for Year 2020 is 1.168
“Trillion Naira; to be funded by a projected Total revenue of 1.071 Trillion Naira, and a deficit amounting to 97.53 Billion Naira.
“The budget size is higher than the 2019 budget by 34%. Capital expenditure amounts to 723.75 Billion Naira, while the Recurrent Expenditure is 444.81 Billion.”
According to the Governor, “giving a 62:38 capital to recurrent ratio. This, in our view, is strong for development.
“We have placed an increased focus on wealth creation where we will take deliberate steps in courting a partnership between our people and various development institutions. In line with this, we have provided N11.8bn as counterpart funds in preparation for various social impact schemes.
“In addition, we have made provisions for N7.1bn this year, to provide for industrial hubs, parks, graduate internship programs and virtual markets for artisans. This is in support for Micro, Small and Medium enterprises which are the engines for both economic and employment growth.
“It is equally proposed that a total of 167.81 Billion Naira of the Recurrent Expenditure shall be applied towards personnel costs and other staff-related expenses.
“This represents 22.02% of the proposed Total Revenue, which is within the acceptable wage policy of 25% of Total Revenue, and includes a provision for the new minimum wage.
“The budget deficit of 97.53 Billion Naira will be financed by both internal and external loans. Since revenue generation is the spine of any budget, this budget supports investment in our revenue generating agencies.”
Sanwo-Olu added, “it is to aggressively invest in and develop our education, health and other physical infrastructure sectors.
“Although our capital spend on works and infrastructure was just 31 Billion Naira as at September 2019, as against the 2019 budget
proposal of 78 Billion Naira, it is our intention to spend 115 Billion Naira in 2020.
“Education will see a significantly increased capital budgetary allocation of 48 Billion Naira, an increase of 60% over the 2019 provision of 30 Billion Naira.
“We must improve the standard and relevance of our education outcomes to our industries.
“We will work together with our Local governments to strengthen early child education and teachers training/administration, leveraging technology,” he said.
Sanwo-Olu recalled one of his first tasks as the Governor, saying he would ensure strict compliance to the reordered 2019 budget.
Sanwo-Olu added, “One of my first tasks when I assumed office as Governor was to sign the 2019 Appropriation Bill into law on June 3, 2019.
“In the five months since the Budget became effective, our administration has commissioned several projects in line with our THEMES agenda, including but not limited to the following:
“We completed and opened the Maternal and Child Care Centers (MCC) in Eti-Osa and Alimosho
LGAs, completed and commissioned 492 housing units at the Lateef Jakande Estate in Igando; and we donated security vehicles and equipment to our security operatives.
“We built Court complex in Eti-Osa Local Government Area, and a Police Command Complex in Ojo Local Government Area.
“Working with you, Honourable members of this esteemed House, we achieved the re-ordering of the budget. This includes a plan to increase borrowing by way of internal loans and bond issuance, totaling N250billion, to address critical infrastructure needs, including the following:
“Public School Infrastructure Rehabilitation program, which will transform 300 public schools across the State. Road Infrastructure Projects: Lagos – Badagry Expressway; Agege – Pen Cinema Overhead Bridge; Agric – Isawo Road; Bola Ahmed Tinubu; Ikoyi-Victoria Island CBD reconstruction projects Igbogbo Road, and our Zero Tolerance for Potholes program, .Rail/Civil infrastructure works;
d. Construction and completion of MCCs in Badagry, Epe and Ojo;
e.Desilting of major drain systems across the State; and construction of new ones;
Provision of Security and Emergency equipment.
“Despite these loans, our sustainability ratio of total debt service to total revenue remains good at 29% and we still intend to achieve a capital to recurrent expense ratio of 55:45 by the end of 2019.
“Let me also state that we are committed to ensuring that all new borrowing is done under the most responsible fiscal terms possible.
In his response, the Speaker of the House, Rt. Hon. Mudashiru Obasa charged the Governor towards realizing the electoral promises, saying the House is poised to do thorough screening within short period.
Obasa declared, “Ladies and gentlemen, we have all listened with rapt attention to how the wealth of our state will be utilized for our common good in Y2020 with the presentation of the budget.
“W shall do the needful; and I assure you that we will meticulously perform our constitutional duty.
“Mr. Babajide Sanwo-Olu, I commend you for being astute, courageous, insightful, forthright, thorough, and determined. You have really displayed, during your few months in office, that you are capable to maintain a track record of resourceful consistency in the state.
“Mr. Governor, your actions so far have shown the zeal, desire and passion in you to get things done, to fix what has been left undone and to move the state forward. Hence, we believe that the content of the budget will serve this purpose in making life worthy of living for our people in Lagos State.
“As is evident, the Y2020 Appropriation Bill is significant in that it is the first budget proposal to be presented by Mr Governor. This will give him the opportunity to encapsulate his vision and mission for us all as the budget will lay the foundation for this. For this singular reason, we are all hopeful and expectant that this coming year will witness more of democracy dividends for betterment of Lagos and Lagosians.
“However, permit me to remind this gathering that the matter of budget presentation is essential. Beyond its constitutional stipulation, it requires the backing of law to make it implementable and executable; without which it becomes an offence punishable under the law.
“Let me remind this gathering that of recent, Lagos State budget has become a topical issue vis-à-vis last administration, where the provision of the budget law was being viciously violated.
“It is worthy of note that the Nigerian 1999 Constitution recognizes the separation of power and empowers the State House of Assembly to dictate how the state fund is being expended and the manner of its presentation.
“Still on this, regarding the last administration, I have heard from different quarters about people asking why this House did not properly query the actions of the immediate former governor while in office. Alas, there is nothing of such.
“Let me take you down the memory lane that it was in this House that Vision Scape, a policy of the last administration, was openly condemned and tagged a ghost.
“Remember too that this House questioned the provision of the budget for this idea.
“But some people, like one Olu Fajana with his faceless group calling themselves the Legislative Probity and Accountability (LPA) led a protest to this House.
“They used the medium to blackmail the House instead of reasoning with us to join hands in moving the state forward, by avoiding the treasury of the state from being touched unconstitutionally.
“With this, it is a common knowledge that the last administration employed blackmailing and harassment to witch-hunt and deprive the House from performing its duties appropriately,” Obasa said.