By BOLANLE OKE
The draft 2012 budget presented to the Osun State House of Assembly by the Ogbeni Governor is the first to be presented, conceptualized and formulated by the Action Congress of Nigeria government in  the state.  Fiscal discipline and performance planning represent a central thrust in the conceptualization of the budget.

The all encompassing philosophy guiding the budget is located within the guidelines of the state’s vision 20:2020 first implementation medium term plan (2010-2013) which has been comprehensively reviewed to incorporate the six-point integral action plan the platform on which the Ogbeni Governor ran for election.

The six point integral plan seeks to banish hunger, poverty,  unemployment; promote healthy living, functional education and enhance communal peace and progress.

With this in mind, the government intends to use the 2012 budget as a trajectory to achieve massive achievements in terms of the execution of developmental projects. The 2012 budget, christened budget of “Service and Progress”, is predicated on the following objectives:

Provision of enabling environment to ensure increase in food production and to encourage agro-allied industries with substantial participation of the private sector;

Reconstruction of social infrastructure, economic and the industrial base of the state;

Creation of conducive economic environment that ensures job creation and empowerment of youths and women;

Promotion of culture of excellence and conducive work environment in the public service;

Development of opportunities for wealth creation through tourism and culture;

Promotion of industrial peace and social political harmony that would lead to revitalization of commerce and restoration of wealth;

Restoration of healthy living to the people of Osun State through the provision of affordable, effective and quality healthcare for all; promotion of functional education by improving basic educational infrastructure and by enhancing capacity of teachers at all levels; promotion of clean environment and healthy living; and reformation of commerce by ensuring standardization of weight and measure.

The size of the draft budget is N146,674,283,140.

Osun State government believes in what one commentator has already termed  ‘total governance’  This represents a structural framework  with which to achieve a multiplier effect for the state’s economy by linking key sectors for employment generation and widening the tax base.

This has already been reflected in  the  O’YES agricultural scheme which has translated into 20,000 new sustainable jobs aimed at curtailing youth unemployment.  Agriculture on which the state government is virtually betting the ranch (the pun is deliberate) remains the decisive focus in the concept of total governance.

Given the importance attached to agriculture and rural development sub-sector, a total sum of N5.6 billion has been provided in the 2012 budget to fund the various government programmes in agriculture and rural development.

It is not an understatement that the level of industrialization in Osun is low in spite of its 20 years of existence. The Aregbesola government is committed to the development of integrated industrial estates for mini, micro and large manufacturing industries and this will be pursued with vigour in the 2012 fiscal year.  The existing industrial estates in Osogbo and Ilesa received attention  in 2011.

The collaboration between the state government and the Bank of Industry in providing micro credits for the operators of micro, small and medium enterprises (MSME) will continue unabated  this year. 26 cooperative groups and three small and medium enterprises have benefited from the scheme.

The administration inherited a staggering commercial bank liability of about N20 billion from the immediate past administration.  This amount includes the huge N18.38 billion loan obtained from a particular commercial bank and other loans from three other commercial banks.

The liabilities were being serviced with an average sum of N1 billion monthly when the Aregbesola administration assumed office.  The first major assignment of the administration on assumption of office was therefore to find means of tackling the issue of the huge monthly loan repayment with its debilitating effect on the economy of the state.

Nevertheless through financial engineering and re-engineering, the State Government paid back the N2 billion owed the three commercial banks by the former administration within the first half of last year.  Similarly, the state government has been able to refinance at a lower interest rate and longer tenor the N18.38 billion commercial bank liability.

Given the array of projects which have been planned for execution in the 2012 fiscal year, the Osun government actually requires a more robust and reliable revenue source for the prosecution of its programmes.  Undoubtedly,  the revenue projection from the Federation Account and the Internally Generated Revenue cannot cope with the financial requirements of the state government.

Rather than relying on the money market for the purpose of raising fund to finance our deficit budget, government intends to leverage on the opportunities offered by the capital market to raise a N50 billion bond. Efforts are already in the front burner for the actualization of this plan as early as possible in the New Year.

The administration will continue to give necessary impetus for the growth and development of commerce in 2012. In order to revitalize commerce and restore wealth back to the state through the revival of customary commercial activities in Osogbo, the state government will embark upon the establishment of a market tagged: “Ayegbaju Modern Market”  Similarly, the state government has acquired 200 hectares of land at Dagbolu, Oba Road, by the side of the railway line for the construction of warehouses and market.

Oke is resident in Oshogbo,Osun State.

The project, tagged “O’Hub”, will be handled through Public Private Partnership (PPP). The Osun government will provide subsidised freight through its partnership with Nigerian Railway Corporation.

It is expected that the completion of the hub will facilitate the transportation of manufactured goods from Lagos through the railway line to Osogbo and transportation of agricultural produce from Osogbo to Lagos. N500 million has been earmarked in the 2012 Budget for the project.

One of the practical steps taken by the Aregbesola administration to improve the internally generated revenue (IGR) is the introduction of the electronic banking system of revenue cycle management (EBS-RCM).This system aims at facilitating proper accountability and transparency as well as ensuring that avenues for leakages are blocked.

Presently, there has been an appreciable boost in the state’s IGR, in fact,  doubling from N300 million to N600 million, which we believe will get better in 2012.