The Lagos State government is not having the covid-19 pandemic as an excuse not to generating more funds for the 2021 fiscal year. This is more so as the state government admits the budget projections are ambitious and audacious enough to rekindle hope as tagged ‘Budget of Rekindled Hope’.
The commercial nerve insists its total revenue target of ₦991.03billion for the 2021 financial year is very much feasible.
In a further remark, The Government argued that as aggressive as the estimates in its ₦702.935billion budget are, they were based on available economic information and intelligence and subjected to interrogation across various levels of debate at the State House of Assembly, constituents, and other stakeholders groups.
Recently at its Facts-Behind-the Figures Media Roundtable on the Year 2021 Appropriation Budget, the Commissioner for Economic Planning and Budget, Sam Egube, further explained that estimates were also buoyed by last year’s sterling performance in a very challenging environment.
Besides, the commissioner believes there are huge revenue-generating opportunities in the state, including real estate, transportation, and commerce sectors, adding: “We will continue to use data and intelligence to unravel revenue opportunities and leakages.”
In his words:
“While we were recovering from the pandemic, the #EndSARS protests and the aftermath of its hijack took us back economically and socially, further compounding the situation.
“However, attributable to our resilient nature, as at the third week of December 2020, our total revenue performed at 93%, while our total Capital Expenditure and total Recurrent Expenditure performed at 80% and 86%, respectively.”
“A significant percentage of the projected IGR (internally-generated revenue) of N512billion is expected to be contributed by LIRS (Lagos Inland Revenue Service). This, he said, will be achieved by expanding the tax net through a simplified tax process, improving our transaction taxes and the appropriate use of technology.
Funding the budget
Egube revealed that the borrowing would be sourced through the capital market (N100billion); External through bonds (N50billion); and internal sources (N40billion) all of which would be deployed into capital expenditure only.
Already, the Capital expenditure took the lion share of the 2021 State Budget of about N703billion while the balance of N460.6billion will go into recurrent expenditure or a distribution ratio of 60;40 percent, respectively.
Against this backdrop, he said the State Government made provision for a deficit of about N192.5billon, “to be financed by a combination of external, internal loans and bonds, which are well within the government’s fiscal sustainability benchmarks.”