Lagos state government has said that it hopes to generate the sum of N1.237 trillion out of which it will finance the N521.275 billion deficits in the 2022 budget. The State Commissioner for Economic Planning and Budget, Sam Egube, said this Friday in Ikeja, during a budget breakdown press conference tagged: “Consolidation Budget”. Egube said that the budget deficit would be financed through a combination of internal and external loans and bond issuance
He said the deficit financing requirement of £ 521.275 million equates to 21 percent of the debt service of the state’s total revenue. The governor of the state, Babajide Sanwo-Olu, submitted a bill of appropriations for the year 2022 of N1.388 rillion to the State House of Assembly for its consideration and approval on November 24, 2021. Additionally, on December 29, 2021, the Sate House of Assembly passed an amended bill of N1.758 trillion and was promulgated by Mr. Sanwo-Olu on Friday, December 31, 2021.
This was after a very rigorous bilateral engagement with the respective Ministries, Departments and Agencies, MDA. Mr. Egube said that the total budget size of N1.758 trillion would be financed with an estimated total revenue of N1.237 trillion. This comprises total internally generated revenue (TIGR) of N980.654 billion, capital income of N142.743 billion, and the federal transfer of N256.268 billion. Egube said 73.5 percent (N599.04 billion) of the projected TIGR is expected to be contributed by the Lagos State Internal Revenue Service (LIRS), while around 19.2 percent is expected. (N156.65 billion) is generated by other government MDAs. “We will achieve this by expanding the tax network with the deployment of technology, economic intelligence, through the collection and analysis of data, among other initiatives. We believe that there are tremendous income-generating opportunities in the informal sector, including real estate, transportation, and commerce.
“The deficit of N521.275 billion is expected to be financed through a combination of internal and external loans and bond issuance. The approved budget for 2022 of N1.758 trillion composed of N1.167 trillion of capital expenditures and N591.281billion of recurring expenses, resulting in a capital-to-recurring ratio of 66:34, is strongly at favour of capital expenditures. Total revenues are estimated at N1,237 trillion while the deficit financing requirement is N521.275 billion, which at 21 per cent of debt service to total income is within the fiscal sustainability benchmarks. 40 per cent, ”Egube said. He said the overriding budget goal is to achieve a consolidation budget to substantially complete the existing and ongoing infrastructure project essential for economic and social development across the state.
