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Friday, September 25, 2020 / 3:59 PM / Ottoabasi Abasiekong for WebTV / Header Image Credit: Twitter; @BudgITng
As the global crude oil price volatility
ensues and Nigeria like other nations grapple with the disruptive impact of
COVID-19, states have been tasked with the responsibility of rethinking
governance and strategies for attaining fiscal sustainability. This was a major
takeaway from the official unveiling of the BudgIT "State of States 2020" report which focused on the theme "Fiscal Sustainability and Epidemic
Preparedness Financing at the State Level".
The event which was a hybrid of a physical
presentation (at Radisson Blu Hotel, GRA, Ikeja, Lagos) and a virtual
participation by stakeholders. The event brought together policy makers,
analysts, business leaders, and advocacy groups.
Giving the opening remarks at the event
the Principal Lead of BudgIT Mr Gabriel Okeowo described the "State of the
States report" as a flagship event for the organization.
According to him since 2015 the "State of
the States" report has provided data-driven research that looks at the
sustainability of states.
For the 2020 edition the BudgIT's
Principal Lead said it took 9 months of detailed research to produce the
report, which covered the 36 states of the federation.
Mr. Okeowo said the methodology of the
report was validated by other key stakeholders in the nation, before its final
publishing.
"The StateofStates report provides
actionable intelligence that serves state governments, citizens and advocacy
groups, and is designed to inspire healthy competition amongst states".
This according to him was the first time
the report launch was being hosted in Lagos, outside the Federal Capital
Territory Abuja and is the part of the plan of BudgIT to extend the launch to
other states in the country.
In his address at the event as the Special
Guest the Governor of Lagos State Mr Babajide Sanwoolu commended BudgIT for its
dedication to driving advocacy at the level of governance and public finance,
covering the various tiers of government.
Citing some of the key points captured by
the report, Governor Sanwoolu was happy to note that Lagos state had 22 or 23%
of its revenue from FAAC allocation in 2019, which has reduced to about 21% as
at August, 2020 revealing the state remains a sustainable without
reliance on FAAC allocation.
He also stated that the Debt Service to
Revenue of the State was 23%(within the 30% global best practice threshold)
even as Lagos seeks to De-Risk the Debt Portfolio it inherited.
Speaking further Governor Sanwoolu said
Lagos state will be relying more on naira borrowing to reduce the risks to
currency measures.
To reflect the COVID 19 economic realities
the Governor mentioned that the state reviewed its budget by 20%.
Looking at the budget composition,
Governor Sanwoolu asserted that over time Lagos has maintained a recurrent to
capital expenditure distribution of 51%-49% and also 55%-45. Recently it went
up to the range of 60% to 40% due to the COVID 19 pandemic which required
expenditure on medicals and consumables for stabilization of the economy.
He informed stakeholders that Lagos
remained the Sub-National with the highest health expenditure at the state
level.
Going forward he said Lagos was exploring
the 3Rs which include;
The Governor stressed that the key areas
of focus for the state will be food security, MSME support, ICT, Arts &
Tourism and Transportation through which Lagos is targeting 29% GDP growth in
2021.
In terms of investments the Governor said
Lagos has attracted about $600m into the Lekki Deep Sea Port, while it is
determined to complete a 6,000km fiber infrastructure to drive the digital
economy.
Looking at Agriculture the Governor said
the Rice Mill in Imota when completed will provide 2.4m bags of 50kg Rice
annually to citizens and will produce 250,000 jobs.
Presenting the Keynote address at the
event Mr Teslim Shitta-Bey the Chief Economist/Managing Editor of Proshare who
represented the Founder/Chairman Mr Olufemi Awoyemi, FCA lauded BudgIT for the
launch of the #StateofStates2020 describing it as an intellectual art, that is
easy to relate with and understand.
He described the annual report as an
effective way to measure policy impact for states ,who have a wider influence
over grassroot socioeconomic development than the Federal Government.
From the presentation he called on Lagos
and the other 35 states to rethink, re-strategize and re-imagine governance and
economic strategy.
Shitta-Bey highlighted the fact that
five(5) states classified as sustainable by the BudgIT report namely Rivers,
Anambra, Ogun, Lagos and Kano were economic hubs and had characteritics that
drove growth in GDP and debt in a marriage of self reinforcing complexity.
On areas that states must address and take
seriously based on the report, he listed the following;
He advised states like Lagos to take steps
in the area of articulating and implementing easily triggered "Disaster
Recovery Plans (DRPs)" would that would position the states to respond to issue
slikes pandemics and ecological disruptions in a programmed and strategic
manner rather than random actions taken aimed at dodging silver bullets. He
emphasized the need for states to be prepared for both dark swan and grey
swan occurences.
The Research Methodology of the
#StateofStates2020 report covered the focus on four indexes which were;
Index A - Ability of States to meet their recurrent expenditure obligation with their internally generated revenue and Value Added Tax. (45%)
The formal launching of the report was
performed by Mr Sam Egube who also joined in commending BudgIT in its role in
advocacy and citizen engagement, especially in its interventions in ensuring
governance transperancy.
The launch also featured a panel
discussion that focused on the theme "Exploring Fiscal Dimensions for Epidemic
Preparedness and Social Protection" with Mrs Toyosi-Akerele-Ogunsiji
(Chairperson, Victim Support Fund;COVID 19 Task Force, Dr David Okelue
Ugwunta(Commissioner for Budget and Planning, Enugu State), Ms Amina Ado (Chief
Executive, Sana'a da limi Foundation) and Mr Sam Egube (Commissioner for
Economic Planning, Lagos State).
Watch Video
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