14th December, 2010
Governor Babatunde Fashola has sent a budget proposal of N445.180 billion for theÂ 2011 fiscal year to the Lagos State House of Assembly, Lagos, Southwest Nigeria, forÂ approval.
The proposed budget exceeded the 2010 revised budget of N412 billion by 8.2 percent.
Presenting the budget to the Assembly today, Fashola said the focus of the 2011Â budget would remain, but not limited to the following key sectors: Law and Order;Â Road and Transportation; Environment; Health; Education; Water; Rural DevelopmentÂ and Agriculture.
â€œThis budget will seek to promote greater co-operation with the local governmentsÂ and Federal Government, especially on roads rehabilitation and power sector reform,Â as well as entrenchment of Public Private Partnership (PPP) as alternativeÂ development strategy for Lagos infrastructure.
The proposed budget has a recurrent expenditure of N196.709 and a capitalÂ expenditure of N248.471 billion while the total revenue stood at N352.320 billion,Â comprising ordinary revenue, N262.620 billion and Federal Transfer of N89.7 billion.
The recurrent expenditure of N196.709 billion comprises N68.229 billion TotalÂ Personnel Cost and N128.480 billion Total Overhead Cost while the capital receipt isÂ N19.261 billion and financing requirement stood at N73.599 billion.
â€œWhen this budget increase is viewed against the recent published inflation figuresÂ of about 13 percent, it will become manifest that the budget has not reallyÂ increased.
â€œWe have revised the Capital to Recurrent ratio of 60:40 in 2010 to 56:44 in 2011.Â The shift towards recurrent expenditure is largely due to the significant growth inÂ our personnel costs as our response to the demand of our workers for improvedÂ welfare and remuneration conditions,â€ Fashola said.
â€œThese are also partly informed by the emerging recurrent costs of maintaining andÂ staffing the various infrastructure projects we have embarked upon over the yearsÂ that are now being put to use. The deficit financing requirement proposed isÂ N73.599bn which is 1.77 percent of the Stateâ€™s GDP,â€ he added.
According to the governor, the components of the total overhead costs of N128.480bnÂ are as follows: Overhead cost; N69.809 bn, Dedication Account, N22.191 bn;Â Subvention, N24.430 bn; Staff Housing Fund, N0.050 bn; Debt Charge (External),Â N1.050 bn; Debt Charges (Internal), N6.958 bn and Debt Charge (Bond), N3.992 bn.
The Capital Receipts for the 2011 Budget is put at N19.261 bn. made up of: Grants,Â N4.194 bn; Investment Income, N0.275 bn and Other Capital Receipts, N14.792 bn.
The Capital Expenditure of N248.471 bn consists of: Core Capital, N220.016 bn;Â Capital Development (Dedicated), N14.442 bn; Grants, N4.194 bn; Counterpart Funding,Â N4.619 bn; Special Expenditure, N5 bn and Risk Retention Fund, N0.200 bn.
The sectoral allocation of the Budget in size and percentage are as follows: GeneralÂ Public Service, N112.608bn (25.3%); Public Order and Safety, N12.763bn (2.9%);Â Economic Affairs, N142.040bn (31.9%); Environmental Protection, N36.390bn (8.2%);Â Housing and Community Amenities, N26.761bn (6.0%); Health, N39.888bn (9.0%);Â Recreation, Culture and Religion, N6.880bn (1.5%); Education, N61.713bn (13.9%) andÂ Social Protection, N6.137bn (1.4%).
Fashola stated that with the proposed budget, the state would consolidate on itsÂ infrastructure programme and progress on ongoing projects like the Lagos-BadagryÂ Road, light rail (Blue Line) and water transportation projects.
â€œMitigation of global warming would remain a key programme and we shall pursue ourÂ environmental mitigation and adaptation activities. We shall also consolidateÂ recently established critical and strategic agencies which include the WeatherÂ Agency, Lagos Safety Commission, Planning Permit Authority and Building ControlÂ Authority.
â€œWe will continue to pursue sustained improvements in crime prevention lawÂ enforcement and justice administration. The Stateâ€™s Free Healthcare and EducationÂ Programmes will also be sustained, while the implementation of the multi-modal andÂ Integrated Mass Transit Programme will be vigorously pursued.
â€œThe government also intends to give teeth to its affordable housing programme byÂ collaborating with financial institutions to establish a sustainable Home OwnershipÂ Mortgage Scheme,â€ he stated.
According to him, â€œThe 2011 Budget will be used to further the goals of jobÂ creation, poverty eradication and wealth creation by ensuring that at leastÂ two-thirds of the total capital expenditure funds are directed to the governmentâ€™sÂ priority areas.
â€œThis government remains concerned about youth unemployment and will continue toÂ implement and pursue policies and programmes that give these critical and importantÂ stakeholders of our society, the best opportunities to realize their potentials.
â€œFiscal discipline in all Ministries, Departments and Agencies (MDAs) shallÂ therefore be improved upon while ensuring that sustained, accelerated, broad-basedÂ economic growth with emphasis on increasing investment and strengthening of theÂ rural economy is maintained.â€
The governor said in view of the Stateâ€™s prime role in Nigeria and indeed WestÂ Africa , with the attendant challenges, the State deserved a compensatory share ofÂ resources such as Value Added Tax (VAT), Port Royalty, and others derived from thisÂ territory.
â€œWe must continue to make the point that the prosperity of Lagos is the prosperityÂ of all Nigeria and vice-versa. Lagos must be treated with special attention, givenÂ its commendable role as the former capital of Nigeria and being the most populousÂ State, with citizens from every nook and corner of the country, placing extensiveÂ pressure on our infrastructure and resources.
â€œWe are the only State that every Nigerian feels comfortable to refer to as a home.Â Indeed, we pay the hard way for our success story as this has continued to attractÂ migration to the State. However, we will continue to tackle these challenges withÂ uncommon commitment as we are determined to sustain the good works of ourÂ predecessors, and reward their enormous sacrifice,â€ he stated.
â€”Kazeem Ugbodaga, Eromosele Ebhomele