The Lagos State government yesterday disclosed that its debt profile now stands at N39.692 billion, even as it said it is targeting N73.836 billion monthly as Internally Generated Revenue (IGR) in 2020.
The state Commissioner for Finance, Mr. Rabiu Olowo, said this while responding to questions from journalists during a media briefing on the analysis and breakdown of the state’s 2020 budget held in Lagos.
He explained: “There are two questions when debt is being considered and they are utilisation and sustainability figures.
“For debt utilisation alone, with fiscal Responsibility Act, 100 per cent of our debts are targeted towards capital projects. If you look at sustainability figures, we are very much on line with international and local benchmark.
“Currently, we finished 2019 at 29 per cent, which is below the 30 per cent benchmark. Going forward into the medium-term, by 2021- 2022, debt figure will come down to 25 per cent meaning that we will be able to manage our debts into the future with increasing revenue in the coming years.
“For Lagos debt charges, our external debt charges stand at N4.9 billion, internal debt charges is N29.7 billion, while charges on the bond is N5 billion. In totality, it amounts to N39.692 billion.
“Also, the deficit financing of the budget is in total of N97 billion. The breakdown shows that external loan is N34 billion, while the internal loan is N63 billion.”
Earlier, the Commissioner for Economic Planning and Budget, Lagos State, Mr. Sam Egube, who gave a breakdown of the 2020 budget tagged: ‘Budget of Awakening,’ said that the total revenue the state expects to generate internally for the year is N886.041 billion, while other revenue projection to fund the budget includes capital receipts N232.29 billion and federal transfers N184.988 billion.
The total revenue estimate amounts to N1.071 trillion, while the deficit of N97.53 billion would be financed by a combination of external and internal loans within the state’s fiscal sustainability benchmark.
Egube disclosed that the state the government hopes to achieve the IGR target by expanding the tax net, through the deployment of technology and other initiatives, which includes massive investment in technology and other facilities to improve the efficiency in operations of all revenue-generating agencies.
He added that about N500 billion would be raised by Lagos State Internal Revenue Service (LIRS).
“We believe that there are huge revenue-generating opportunities in the informal sector, including real estates, transportation for which Lagos State is known for,” he said.
The state earmarked N711.031 billion for capital expenditure and N457.529 billion for recurrent expenditure, making it a ratio of 61:39 per cent, in favour of capital expenditure.
The education sector has the highest allocation of N136.100 billion, which is N70.40 billion higher than last year’s provision of N65.693 billion.
It is followed by roads and other infrastructure with a budgetary provision of N117.248 billion and health with N111.775 billion.
Others are: Science and Technology – N10.629 billion; Environment – N66.586 billion; Tourism – N7.481 billion; Sports Development – N7.740 billion; Housing and Community Amenities – N48.559 billion; and Agriculture and Food Security – N4.840 billion.
Also, Commerce and Industry got N3.926 billion; Wealth Creation and Employment – N8.403 billion; Women Affairs – N2.920 billion; Youth and Social Development – N3.716 billion, and Security and Governance – N39.265 billion.
The commissioner said the objectives of the budget was to attract private sector investments by creating an enabling environment; aggressively develop, upgrade and maintain infrastructure; invest in human capital development, education and healthcare; and facilitate sustainable social investment and enterprise.
Egube said the budget was the result of widely-held consultations across the three senatorial districts, in addition to taking memoranda and feedback from stakeholders meeting hosted by Honorable Members of the state House of Assembly within their respective constituencies.
“To drive the execution of 2020 Budget, this administration will deploy a digitally enabled Performance Management System which is in line with our commitment to transparency and accountability in the management of public finances.
“This budget has taken into consideration the present economic realities in the World, Nation and Lagos State in particular, as well as the optimism for improvement in our revenue collections,” he said.