Tuesday, December 01, 2020 / 2:37 PM / Ayomide Oguntoye
for WebTV / Header Image Credit: National Insight News
As the Lagos State Government (LASG) prepares for the 2021 fiscal year, members of the state executive council recently had a web-based virtual conference to explain the structure of the budget and its design around the states T.H.E.M.E.S agenda, crafted as a policy-focused acronym by the Babajide Sanwo-Olu-led administration.
To kick off the meeting the Commissioner of Economic Planning and Budgeting, Mr. Sam Egube, highlighted the key points of the agenda to include;
Speaking further he stressed that the 2021 budget, which he referred to as "A Budget Of Rekindled Hope" summed up the challenge posed by the COVID-19 pandemic in March and the adverse effect of the #EndSars protests in October 2020. He mentioned the fact that the administration was focused on youth employment with the additional objectives of:
According to the Commissioner one of the key thrusts of the 2021 fiscal year strategy was to create a youth-driven economy in Lagos State.
On his part the Commissioner of Finance, Dr. Rabiu Olowo, said that the 2021 budget was an opportunity to re-examine and reshape the fiscal model to improve engagement and impact.
He noted that the ministry of finance was a web that spreads across various ministries, departments and agencies with a focus on revenue management, investment management, reporting and compliance.
Reviewing revenue this year, the Commissioner said that with a target revenue at 96% this year, the ministry has been able to successfully restructure all existing internal loans from 20% to 12% with a Debt Sustainability ratio of 22% and a benchmark of 40%.
Dr. Fredric Oladeinde, Commissioner of Transportation also contributing to the session, described transportation as the engine of any economy and the most complex and yet one of the most important aspects of an economy's growth. He said that the vision for Lagos State is to develop an Integrated Model Transport System.
With about 22 million people in the State, Oladeinde noted that the State records about 24 million trips per day and it is projected to record more than this in the coming years.
With about 95% of the trips made on road, he said that there is a need for diversification and the plan is to make Lagos State a smart city and as a result, create a robust and integrated public transport system.
He mentioned that the strategic master plan which includes 7 rail Lines, 14 BRT buses and 26 water routes is projected to last for 20 years. Dr Oladeinde also mentioned other modalities to consider which include:
He also reviewed the effort of the administration in traffic management. He mentioned that the State's network which was initially developed for a population of about 3.5 million people now caters for about 22 million people resulting in bottlenecks. However, the administration has been able to work on Allen Avenue, Abraham Adesanya down to Lekki Phase 1 and 2.
Mrs. Folashade Adefisayo, the Commissioner for Education in her review, said that the ministry is saddled with a huge responsibility that caters for all other ministries. She mentioned that the ministry is faced with issues like the equity issue, funding, lack of personnel etc.
She, however, mentioned that the Ministry was looking forward to partnerships and collaborations with other ministries. The ministry also sought to upgrade the standards of public schools in the state with a major focus on technology.
Also speaking at the review session, Mrs. Abisola Adefisayo, the State's Commissioner of Agriculture, said that the contribution of Agriculture to the State over the years, has been low and the sector's overall contribution to the country's GDP was about 21%. With regards to employment generation, she noted that Agriculture contributed 70% to jobs in the country with most people living in rural communities.
She highlighted the strategic objectives of the Agric Ministry which involves four (4) key areas;
The Ministry, according to her, also looked forward to transforming the market to harness every opportunity available, with proper infrastructure to ensure food security. T.H.E.M.E.S represents Traffic Management and Transportation; Health and Environment, Education and Technology; Making Lagos a 21st Century state; Security and Governance. According to Adefisayo "we are looking forward to creating an enviable market structure, not just as a means for purchases but also as a means of agro-tourism" she noted.
The ministry also looks forward to creating an enviable market structure, not just as a means for purchases but also as a means of agro-tourism.
Analysts at the session raised a wide variety of issues ranging from the apparent absence of a clear cut policy that addresses the huge potential in Lagos's blue economy and the large opportunities that could exist in a night economy similar to that of Dubai in the United Arab Emirates (UAE). It was noted that there were some concerns about the states rising debt profile and a COVID-19-induced pullback in revenue as taxes such as value added tax (VAT) was likely to fall behind projections in the year as a result of the virus pandemic and the economic disruptions and commercial losses suffered during the EndSARS campaign in October with Lagos as the epicentre of youth agitations.
Lagos State IGR (N'bn) 2019
The government clearly, according to private sector reviewers of the state's 2021 budget, has a lot of fiscal rejuggling to do to sustain expansion of its capital expenditure in the coming year 2021. In addition a lot of work would need to go into restoring confidence in the state's security architecture and its business friendliness for fresh investor funds to flow into the many sectors that may require patient private capital.
Nevertheless, the T.H.E.M.E agenda if methodically and clinically executed may pivot the state's GDP growth trajectory towards a more inspiring rate of between +5.02 and 6.03%. This would contrast markedly with the -3.62% national growth rate in October 2020 and the -1.96% that some analysts have forecast for Q4 2020.