It is no news that many states in Nigeria are still unable to pay workers who are being owed salaries of a minimum of six months. And this is despite that the federal government had last year granted the distressed states bailout package of N713.7 billion and an additional N90 billion loan with some financial discipline conditionalities.
Certainly the difference between the failing states and the very few dependable ones has never been the paucity of funds, but that of sound financial management and probity.
In fact most of the states are like spoilt brats who are eternally tied to the federal government’s apron strings with their monthly visit to Abuja to get their share of the oil money for upkeep.
So when the petro-dollar was swelling in the Federation Account and regularly shared by the federal and state governments, instead of the state governments to embrace creative ideas and embark on sustainable projects that will attract investments, they went on shameful spending sprees. Most of the state governors are known to have dipped their hands into the states’ treasury with reckless abandon.
Thankfully though, the few reliable ones amongst the states are showing that either in scarcity or plenty the fixation on financial prudence and responsible spending engenders an atmosphere of shared prosperity. And that is the enviable spot Lagos State has held since the period of Governor Bola Tinubu when finance was a neck-breaking burden for the state government because of the animosity between Tinubu and the President Obasanjo-led federal government which withheld supply of financial oxygen from the state.
Following the footsteps and template of his predecessor, Babatunde Fashola who was evidently relatively financially okay due to the impressive growth in the internally generated revenue of the state during his term made Lagos a shinning example of good governance.
Even though Fashola’s successor, Governor Akinwunmi Ambode took over the leadership of the state when the country’s economy had nosedived and the federal government, the supplier of the monthly petrodollar, was also crying for assistance as a result of the plunging global oil prices, Ambode has kept the ship of state afloat. Instructively, this is not done by magic. It is a business of logic and good planning. And that is what really makes the difference in any human endeavour.
Expectedly the prevalent economic hardship and the shame that it has brought on many careless states has compelled some states to change their attitude towards spending. While some states have cut down their capital expenditure, others are embracing austerity measures and cutting down on overhead costs to avoid total collapse. But the truth is Lagos State cannot be classed in the club of these perpetually unweaned ones. The state is on a class of its own.
Lagos remains the commercial nerve centre of the country which is already generating massive revenue within its borders. And there are still so many yet-to-be harnessed income-generating avenues for the state government to explore. I bet that’s the reason why the governor is so confident of implementing the programmes of the 2016 budget worth a total of N662.588 billion.
People in the know have also hinted that even though the governor acknowledges the hardship the falling crude oil prices has brought on the economic life of many Nigerians, the state’s budget was prepared to be driven by Internally Generated Revenue (IGR). And that the governor is keeping a card up his sleeves.
Previously I have stated that a game plan that is designed to massively jack up the revenue base of the state and which the government is relying on was the gaming industry. Lagos State, being the pioneer government to tap into the revenue benefits of that sector, recently revealed that the Lagos State Lotteriesboard generated about N1 billion in 2013 from about 11 sport-betting companies in the state.
But who would have ever thought that Lagos State would become a bonafide beneficiary of the 13% derivation fund accruable to oil producing states of the federation?
This is obviously another good game plan and a fantastic game changer for the state in its efforts towards attaining greater developmental heights. And this potentially huge revenue generator is made possible through the tenacity and exploratory fortitude of a Nigerian company, Yinka Folawiyo Petroleum (YFP), headed by a dogged oil and gas entrepreneur, Mr. Tunde Folawiyo.
YFP announced in May that it had started crude oil production from an offshore field in Lagos.
“Yinka Folawiyo Petroleum Co. Ltd (YFP) is pleased to announce that it has commenced production of crude oil from its Aje field located in block OML 113 offshore Lagos.
“The attainment of this milestone is indeed a laudable achievement not just for the YFP, but for the Nigerian oil and gas industry as a whole and indeed Lagos State, which can now be addressed as an oil-producing state,” said Tunde Folawiyo in a statement.
Upon this important declaration, Ambode commended Tunde Folawiyo and his team. The governor also reiterated his commitment to creating a better environment for innovation and more viable businesses to thrive in the state.
Evidently, Governor Ambode continues to stun many with his alluring approach to governance which is making people wonder if he has been in the seat of power for more than the 18 months since his assumption of office. And the successes of businesses like YFP can be partly attributed to the enabling infrastructure created by the state government under his watch.
With what we have seen so far of public spending in Lagos, it is undoubted that any additional revenue accruable to the state will be expended for the good of all.