The Lagos State Commissioner for Economic Planning and Budget, Sam Egube, has revealed it was necessary the government review its 2020 budget downward due to the adverse impacts of COVID-19 on economic and social activities on the state.
The 2020 budget at N1.168,561,893,990tn which was passed late in December 2019 with an estimated revenue of about N1.07tn consisting of Internally Generated Revenue of N886.04 bn and federal allocation of N184.99bn, was slashed to N920.5bn, a difference of N248bn, representing a 21 percent cut to reflect the new economic and social realities.
Egube had attributed the review to “deleterious effects on statutory allocation expectations, slide in internally generated revenue and devaluation of the naira, reduced public and private investment, increased inflation, decline in demand for goods and services and reduction in manufacturing activities, which portends lower gross domestic product (GDP) growth and increased unemployment.”
The commissioner, who explained that the state government has adopted a holistic approach to the shocks induced by the coronavirus, further disclosed that the state would maintain a strong pandemic response, restart the economy and re-imagine the modus operandi of the state.
He said, “To restart the economy, we are going to optimise the state’s budget for investment for investment in jobs and priority sectors through job creation, economic stabilisation, and fiscal consolidation.
“In reimagining the state economy, we will prepare the state to operate and thrive within a new reality with digitisation, business environment reforms, improved economy and diversification of revenue sources.”
According to Egube, in the reviewed budget, recurrent expenditure will decline by 10 percent from N457.529bn to N411.608bn while total capital expenditure will be reviewed downward to N508.861bnn from N711.033bn being a 28 percent adjustment.
Get real time update about this post categories directly on your device, subscribe now.