Breaking News
Translate

Lagos to fund projects through borrowing — Commissioner

By Olasunkanmi Akoni & Monsur Olowopejo
AS the Lagos State Government continues on its massive infrastructure renewal in the state, it has disclosed its intention to continually borrow money to take care of its capital projects in the interest of the general populace.

It has also disclosed plans to focus on projects implementation of the year 2009 in the 2010 budget proposal. The focus includes roads and transportation, environment, health, education, water, rural/riverine development, law and order and agriculture.

The state Commissioner for Economic Planning and Budget, Mr. Ben Akabueze disclosed this yesterday at the budget consultative forum and overview of the year 2009 budget/2010 projections, held at the State Secretariat, Alausa, Ikeja.

According to Akabueze, the measure became necessary because the state will be running a deficit budget in 2010, meaning that government will spend more than the revenue generated.

Akabueze, while presenting the overview to stakeholders and participants that included, members of the state Executive Council, Lagos state Head of Service, Alhaji Yakub Balogun, Permanent Secretaries, Directors, Local Government chairmen, traditional rulers, community leaders, Organised Private Sectors (OPS), representatives of youth associations at the event, said the state government was currently running a deficit budget for the 2009 fiscal year because of the large number of projects earmarked for immediate implementation.

He stressed that in order to meet myriad challenges facing the government, there was the need to evolve means of meeting the yearnings of the people, hence there is nothing the government could do than to borrow money to finance those projects, “We will spend more than what we have budgeted for to implement our projects in 2009.”

Akabueze who also disclosed plans of the government to enlarge its tax net next year, lamented that the state government is also losing its tax nets to the present economic realities. He cited the case of Dunlop which had to relocate to other countries due to harsh economic situation in Nigeria.

He therefore, appealed to Lagos residents that earning their income and within tax net to do so willingly in order for the government to continue with infrastructural renewal as well as other basics amenities.

On  budget focus and implementation, Akabueze, however posited that the 2010 budget would not be different from the 2009 because of the current global economic recession, which he admitted is seriously affecting the country economy, including that of Lagos.

“We will borrow money as a matter of policy. We will not use borrowed money on any other thing than spending it on capital project. We will also ensure that the deficit budget is not more than three per cent of the state Gross Domestic Product (GDP)”, he emphasized.

Akabueze also said the World Bank projections indicate there will be relatively little or no changes in the world economy despite bailouts, adding, “Nigeria’s economy will be defined by weak global energy prices, which will probably oscillate around $50.00.”

He said that the continued low oil outputs would predominate as Niger Delta crisis persist, causing a contraction in the amount of available grants and loans from external sources.

This, according to him will affect Lagos state, which derives about N57 billion of its budget as Federal government transfers in form of statutory allocations and Value Added Tax (VAT).

Tagged Budget Consultative Forum, Akabueze said that the objective of the overview was to generate quality ideas from stakeholders on the 2010 propose budget.

He said the state government overriding policy thrust is poverty eradication and sustainable economic growth through infrastructure renewal and development; ten point agenda and Millennium Development Goals (MDG).

In her brief speech, Mrs. Florence Oguntuase, special adviser to the governor on economic planning and budget, said the forum has become expedient in realization of the role that budget has come to play in development, decision making and good governance.

“The Y2010 budget is going to be premised on the medium term expenditure framework in line with acceptable best practices and which has provided the necessary platform for the three-year budgeting approach being operated in the state.”

She also explained that the medium term expenditure framework is a three-year revenue and expenditure outlay from which the state derives the annual budget as it provides government an opportunity to look at the needs of the state within a medium term framework.

Meanwhile, various contributors at the forum while commending the on going efforts of the state government in transforming the state into a mega-city, urged the state government to focus more on road rehabilitation and construction as well as development of modern markets.

They also bemoan the lack of infrastructural maintenance because most of the infrastructure put in place was left as soon as they were constructed without proper monitoring.


Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.