Lagos State Governor, Babaunde Fashola has presented a budget proposal of N489.69 billion to the Lagos State House of Assembly for approval for the 2015 fiscal year.
The budget is the same as that of 2014, which stood at N489.69 billion, while it still retain its zero deficit in order to ensure that the next Government does not inherit a deficit.
The Capital to Recurrent ratio is 51:49 for 2015 which is the same as 2014 budget.
The budget is made up of Capital Expenditure of N249.232 billion and a Recurrent Expenditure of N239.948 billion in the ratio of 51:49 respectively.
A breakdown of the budget showed that Economic Affairs has the highest allocation of N146.305 billion, followed by General Service, N107.69 billion, Housing and Community Amenities, N82.14 billion; Education, N49.033 billion; Health, N44.619 billion and Environmental Protection, N34.953 billion.
Others are: Public Safety and Order, N15.547 billion; Recreation, Culture and Religion, N3.118 billion; Social Protection, N1.589 billion; Planning Reserve, N2.26 billion and Contigency, N2.448 billion.
“As you will observe, we have retained essentially the same budget size as 2014. This is for many reasons. One reason is that we have kept a zero deficit in order to ensure that the next government does not inherit a deficit. This will give them room to start off very quickly when their programmes begin to crystallize and they may need to raise funds in order to start off.
“Another reason is that our budgets, like all good budgets, are not only defined by plans and expectations, they make more sense if they are defined by resources. Our resources have been severely adversely affected by the management and lack of transparency of the Federal Government and her agencies of the nation’s oil proceeds.”
The governor said the Federal Government is still owing Lagos State Government N51billion certified and unpaid, out of N59billion expended on Federal Government roads in Lagos.
“They are also owing pension obligations of N673.67 billion which they have not paid. And as all of us are aware, oil prices have dropped from $100 per barrel and above to just around $80 per barrel at the time we finalized the budget.
“Our monthly receipts from FAAC have fallen below our usually conservative expectations for the first time in seven years. And lately, we are noticing that reduced patronage of the tourism and entertainment facilities has occurred in the aftermath of the Ebola outbreak. This has translated to reduced consumption and consequently reduced incomes in the Consumption Tax sub-head of our Internally Generated Revenue,” he said.
According to Fashola, “because we will not implement this budget fully by ourselves, we have thought it fit to moderate expectations in order to avoid disappointments. I remain optimistic, however, that our workers’ successful and courageous containment of the Ebola infection is the strongest statement of who we are and in no time I expect that activities in those tourist facilities will pick up because the confidence in our government is very high out there.”
He said in spite of these challenges, the 2015 budget would focus on payment of contractors’ liabilities to enable government complete as many projects as possible before handing over.
He added that one of the highlights of the 2015 budget would be the settlement of outstanding pension liabilities that were imposed by the Federal Government which later became contentious, saying without consultation with the states, the Federal Government had reviewed pensioners’ entitlements upwards by 142% without a corresponding 142% upward review of states’ revenues.
“While I remain convinced that the Federal Government which receives 52% of national revenues and leaves the 36 States and 774 Local Governments to share 26% and 20% of national revenues has no legal basis to impose financial obligations on states and local governments, our government’s compassion for the plight of these pensioners has weighed more heavily on our minds, than the legal misfeasance of the Federal Government.
“Our government has therefore committed to pay and now budgets for the 142% arrears, in addition to 12% and 6% recent reviews. This is the least that we think these public servants deserve. Apart from this, our Contributory Pension has been largely up to date, except for a few parastatals for whom we are also making provisions,” he said. Click to signup for FREE news updates, latest information and hottest gists everyday
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