Lagos projects 59% capital expenditure, as Sanwo-Olu presents 1.38trn proposed Y2022 budget


…As general public services, health, education attract lion share

By Moses Adeniyi

Lagos State Governor, Mr. Babajide Sanwo-Olu on Wednesday presented before the State’s House of Assembly, the year 2022 appropriation bill for the State with a budget size of  N1.38trn.

The Year 2022 appropriation bill christened “Budget of Consolidation,” has a budget size of N1.38trn, comprising a total                 revenue               of N1.1trn           and        deficit   financing              of   N253bn.

The recurrent expenditure was pegged at  N564.9bn at 41 per cent, while the capital expenditure has N823.35bn at 59 per cent.

According to Sanwo-Olu, the deficit financing will be by way of a combination of external and domestic loans and bonds, which he said are well within the State’s fiscal sustainability parameters.

“We have clearly articulated our vision in tackling governance in the State through the T.H.E.M.E.S agenda and have commenced the state’s thirty-year development plan 2021-2051 that will update and replace our previous plan, which was for 2012-2025.

“This is necessary given the huge global changes that have come on us as a people and a nation. We must therefore continue to have a long-range view to our desired outcomes,” he said.

The proposals of the budget include a total revenue of N1.135trn for Y2022 which composes of total internally generated revenues and total federal transfers of  N898.891bn and               N236.268bn  respectively.

For recurrent expenditure at N564,934,331,886.41bn, total Overhead Cost was N303,272,873,298.10 comprising: Overhead Cost – N158,734 783,394.89;  Subventions  N89,642,302,488.07; Dedicated –  N54,895,787,415.14;

Also were Total Personnel Cost                 –  N189,399,268,261.4;    Recurrent Debt service –  N72,262,190,326.82.

The breakdown of the Sectoral allocation in line with Classification of Functions of Government (COFOG) includes (in Naira and percent respectively) include: General Public Services, N235,400,815,610975bn 16.96 per cent; Public Order and Safety                4.45per cent; Economic Affairs, N325,014,165,395             23.41; Environment N49,846,704,975bn, 3.59percent; Housing and Community Amenities N77,980,156,022bn, 5.62percent; Health N123,166,815,968bm, 8.87 percent.

Others are  Recreation, Culture and Religion N16,768,767,649bn, 1.21percent; Education N171,672,5145,711bn,                12.37percent; Social Protection N9,810,289,079bn 0.71percent.

The allotment for Contigency Reserve (Including Special  Expenditure-Statewide and Special  Expenditure-Others) was N10,840,406,741 N26,077,160,775 N36,917,567,516 2.66 respectively; Loans (Repayments, CDSA & Debt Servicing)-                N170,997,372,704 N170,997,372,704 12.32, respectively.

Personnel Cost (Servicewide and  Pension) N53,147,182,926 – N53,147,182,926   3.83percent; Grants & Counterpact Fund N55,852,385,009 N55,852,385,009 4.02percent respectively.

Giving rationale to the christening of the budget, Governor Sanwo-Olu said “2022 is a year in which we will focus obsessively on completing ongoing projects, while also expanding our social intervention programs and support for citizens, and for micro and small businesses.

“The Y2022 Budget is aimed at consolidating all our efforts so far, into timely delivery of our electoral promises of a Greater Lagos to all citizens and residents of the State. Our destination is now in sight.

“Despite experiencing one of the most challenging times in modern history in our beloved state, we have advanced in a manner that ensures that conviction of our progress is incontestable.

“Lagosians can testify to the improved standard of infrastructure delivered by our administration throughout the 377 wards across the State, which aligns with the State’s mission to eradicate poverty and promote economic growth through infrastructural renewal and development.

“But we cannot afford to rest on our oars. We are therefore using this opportunity to again announce our commitment to delivering the Lagos of our dreams: Africa’s model mega city, a global economic and financial hub that is safe, secure, and productive,” he said.

The  year 2021 revised Budget of N1.256Trillion, had a total revenue of N984.573bn, and deficit financing of N271.994bn. Capital expenditure came to N743.224bn, representing 59% of the total, while Recurrent Expenditure stood at N513.343bn, representing 41%.  The  Generated Revenue (IGR) stood at N128.2bn, about 28% higher than IGR in the corresponding quarter of 2020, which stood at N100.3bn.   Also, in that Q1 2021, capital expenditure amounted to N119.92bn, representing 68% performance on target.

Q2 2021 revenue recorded a performance of 76% of our projected target for the quarter, while expenditure came to 82% of target. In the third Quarter, Q3 2021, total revenue amounted to 78% of projection, while total expenditure came to 79% of target.

On financial management, he  disclosed the State Government has successfully restructured all its existing loan facilities, translating into a reduction in interest rates from an average of 18% to about 12.75%.

Some of the concrete achievements he noted the administration secured with the 2021 budget year, revolved around Rehabilitation of major arterial roads; new high-impact roads and bridges;           Urban regeneration programs;  Connecting roads;   Junction gridlock resolutions:  multi-modal transport strategy, Youth Development courses,  Graduate Internship Placement Programme (GIPP), various housing projects, among others.

He disclosed the Government is about to launch a new car hailing initiative introducing about 1,000 new taxi cars tagged “LagosRide” on the transportation landscape.

In his remarks, Speaker, Lagos State House of Assembly, Mudashiru Obasa assured the Governor of the support of the House with speedy consideration of the bill.

Applauding the Governor for inclusive governance system, Obasa said he has maintained a track record of resourcefulness and development in the administration of the State.