Austerity measure: How we’ll cushion effects

January 6, 2015

LAGOS — MINDFUL of the impact that falling crude oil prices will have on the fortunes of Nigeria this year due to declining foreign revenue, a host of the state governors have mapped out measures to cushion the effects of the dwindling economic fortunes on the citizenry.

With meagre statutory allocation from the centre, there are fears that many states would not be able to pay salaries regularly and provision of basic amenities and maintenance of infrastructures may also suffer and politicians get ‘very’ busy with the 2015 elections.

The Nigeria Labour Congress, NLC, in its New Year message, called on Nigerian workers to brace up for a tougher 2015. In a statement by its President Mr. Abdulwaheed Omar, titled “Tough times don’t last forever,” it said: “Collated reports from our state councils indicate that a number of state governments and some federal MDAs have not paid their workers for December as the year comes to an end.

“Of the 30 states reporting as of 30th of December, 11 subjected their workers to a Christmas/New Year celebration without the December salary. Three of these owed their workers arrears of salaries ranging from three to eight months! Some federal government employees in the Ministries of Education, Labour and Productivity, among others, are owed arrears of salaries ranging from 1-3 months.’’

However, the governors said they are on top the situation and will do the needful to save the citizenry and minimise the effect of expected austerity measures.

A peep into the budgets proposed by 31 of the 36 states of the country shows that some of the governors are prioritizing projects to meet basic needs.

Apart from proposing ‘frugal’ or ‘austere’ budgets for 2015, a host of them said they would pursue aggressive internally generated revenue (IGR) to augment whatever they will get from the centre as allocation.

They also allayed fears that boosting their IGR would entail a heavy tax-burden on their citizenry and businesses.

So far, states that are yet to present their 2015 budget proposals are Ondo, Abia, Rivers, Yobe, Jigawa and the Federal Capital Territory, Abuja.

Ogun budget of repositioning

While presenting his N141.778 billion 2015 budget proposal tagged ‘Budget of Repositioning’ in Oyo State, Governor Abiola Ajimobi, who is seeking for a re-election, pledged that no new taxes would be imposed on the people, notwithstanding the poor financial situation of the state occasioned by sharp drop in oil revenue. The state spent about N190 billion last year.

He said rather than impose new taxes on the people of the state a strategy had been put in place to enhance the level of cost effectiveness of revenue collection, especially with respect to existing fees and levies.

However, the governor said priority would be given to expanding the state’s taxable base through accelerated gainful employment generation by private investors in the state. Of the N141.8 billion budget the sum of N86.72 billion (61.17 per cent) is allocated to recurrent expenditure while a miserly N55.05 billion (38.83 per cent) will be for capital expenditure.

Imo: Okorocha goes for total rescue, allocates 57% to capital projects

The Imo State Governor, Owelle Rochas Okorocha proposed a budget of N141,219,133,849, termed “budget of total rescue and sustainability,” for the 2015 fiscal year.

Presenting the budget to members of the state legislature, Okorocha said the budget represented an improvement from the last fiscal year’s N137,684,678,119. He stressed that recurrent expenditure for the 2015 fiscal year would be 43 per cent, while outstanding 57 per cent would be channelled to capital projects.

The governor explained that the higher allocation for capital expenditure, which he said, was “the thrust of the budget since 2012, is a policy meant to sustain the basic structure upon which other structures will stand to guarantee balanced development, industrialisation, private investments with high multiplier effects for wealth creation, employment generation, conducive business environment and improved welfare of the citizens.”

Ekiti goes for realistic budget

In Ekiti state’s N80.78 billion “budget of reality”, which represents 77.7 per cent of the 2014 budget of N103.8billion, Governor Ayodele Fayose allocated N48,717 billion to recurrent expenditure and N31. 956 billion to capital expenditure.

He said the size of the budget was informed by his government’s desire to live within its means and go with an achievable estimate rather than “decorate the budget with unrealistic figures.”

It’s unlimited opportunities in Niger

In Niger State, Governor Mu’azu Babangida Aliyu forwarded to the House of Assembly a “Budget of Shared Vision and Unlimited Opportunities,” estimated at N80.815 billion.

In a statement, his Chief Press Secretary, Israel A. Ebije, said the capital expenditure is N38.5 billion (47.83 percent) while recurrent expenditure is N42.6 (52.17 per cent). The governor said the budget is more realistic and in response to the dwindling crude oil prices.

Ebije disclosed that the budget is N18 billion less than the 2014 appropriation bill as the state drives for a realistic budget, adding that a 50 percent increase is projected from IGR as the state moves to diversify its revenue sources.

Delta: Economic sector gets lion’s share

In Delta State, Governor, Emmanuel Uduaghan proposed N327.68 billion for the 2015 comprising of N161.6 billion recurrent and N166.07 billion capital estimates, representing 49.32 and 50.68 percent respectively.

Uduaghan disclosed that the 2015 estimates was lower than the 2014 fiscal estimates by N123.05 billion due to the fall in the price of crude oil at the international market.

Sectoral breakdown of the capital estimates revealed that a lion share of N50.32 billion, representing 30.3 per cent went to the economic sector, followed by the social, general administration and environmental sectors while the sum of N34 billion was voted for the Delta State Oil Producing Areas Development Commission (DESOPADEC).

His words: “The 2015 budget is driven by the successes recorded in various sectors of the state’s economy in the past seven years up to the 2014 budget of Consolidation, Sustainable Economic Growth and Development as the 2015 budget is aimed at consolidating the achievements of 2014 budget as well as completing all ongoing projects and programmes that will facilitate the fulfilment of the administration’s goal of making Delta State one of the most industrialised and developed states in the country by 2020.

Katsina State Governor Ibrahim Shema, while proposing a N110 billion ‘Budget of Accomplishment’ made up of N34 billion for recurrent expenditureand N75 billion for capital expenditure for 2015, said the budget proposal was consciously prepared to sustain the development recorded so far, adding that government intends to consolidate and leave behind a platform for growth and development.

Taraba: Making communities accessible

In Taraba, the Acting Governor, Alhaji Sanni Abubakar Danladi allocated over N22 billion of the N97.3 billion proposed budget to the Ministry of Works to ensure there are more access roads in the   rural areas. “There is need to provide more communities with access roads. That is why the Ministry of Works has the highest allocation of N22,063,221,363.00,” he said.

He also allocated N53.3 billion of the budget to capital projects while recurrent expenditure got N42.7 billion.

Bauchi: We will pay salaries promptly –Yuguda

While presenting the Bauchi State.s 2015 N127.89 billion budget, Governor Isa Yuguda said that a huge percentage of the budget would be for the payment of salaries, wages, pension and gratuity.

He said that the budget would give priority to health, agriculture, water resources, poverty eradication, women and youth empowerments as well as ongoing projects.

Adamawa: Ngilari opts for consolidation

In Adamawa State, Governor Bala James Ngilari proposed a N100.89 billion “Budget of Consolidation and Hope” of which capital projects got N42 billion and recurrent expenditure was allocated N57billion.

To achieved the desired impact, he assured that stringent fiscal control mechanisms will be employed to ensure all loopholes and leakages are blocked for a high performance and maximisation of the budget.

Jang proposes inclusive growth on the Plateau

Plateau State Governor, Jonah Jang said his 2015 N215.5 billion “Budget of Transition and Inclusive Growth (V)” would focus on the completion of ongoing projects.

The governor said the budget would ensure smooth transition from the present administration to the next one in 2015.

He added that the budget was a 4.26 per cent drop from 2014 estimate of N225.1billion, and attributed the drop to the state’s dwindling economic fortunes, particularly in oil receipts.

Jang said N92.5 billion had been proposed for recurrent expenditure, representing 42.93 per cent of the budget, while N122.9 billion was proposed as capital expenditure, representing 57.07 per cent of the total budget.

Edo: Oshiomhole seeks consolidation

In Edo State, Governor Adams Oshiomhole said his N159.3 billion “Budget of Developmental Consolidation” is aimed at taking the state to the next level. It is made up of N87.5 billion as Capital expenditure (55.77 per cent) and N68.99 billion (44.23 per cent) recurrent expenditure.

The budget is N4 billion lower than the 2014 budget which stood at N160.1 billion.

He also said the budget is designed towards the completion of all ongoing projects, injection of new investments in key priority sectors of the administration which are roads construction and rehabilitation, education, health, water, rural electrification and environmental protection including drainage, erosion control and beautification.

The governor said the budget will also address projects for job creation particularly through economic empowerment with emphasis on micro-credit to small and medium scale enterprises; Project for mass housing, expanding the revenue base, creation of the enabling environment for domestic and direct foreign investment and deepening of governance reforms.

Anambra: Expanding frontiers of excellence

For Anambra State, Governor Willie Obiano proposed a budget of N164,496 billion which represents a marginal increase of 3.17 per cent over the 2014 N159,469 billion estimate.

Obiano said he wants to expand the frontiers of excellence in Anambra State by embarking on extensive infrastructural development that will enable the state shrug off its current inhibitions and challenge for a position among Nigeria’s front line states.

A breakdown of the budget aptly tagged “Budget for Wealth Creation and Social Cohesion” reveals that Anambra will spend an estimated N110.979 billion on capital expenditure and N53.517 billion on recurrent expenditure representing approximately 67.5 per cent and 33.5 per cent respectively.

“This is consistent with the broad policy thrust of providing adequately to support investments in the Economic Pillars and Enablers, while ensuring that the cost of governance is adequately provided for, and that we are efficient and robust in the use of our available resources,” he said.

He promised to ensure that workers welfare is given adequate attention in the 2015.

Akwa Ibom: Capital projects gets 80%

In Akwa Ibom, Governor Godswill Akpabio proposed to spend N492 billion for the 2015 as against the N498.5 billion he spent in 2014. He allocated N268 billion to capital expenditure while recurrent expenditure has N94.7 billion.

Essentially, the state government said it is committed to the completion of such flagship projects as Tropicana Entertainment Centre, roads, specialist hospital and four-point Sheraton Hotel, Ikot Ekpene among others.

Lagos: Fashola seeks zero deficits for successor

Governor Babatunde Fashola of Lagos State while presenting the 2015 budget proposal of N489.69 billion, which is the exact amount he spent last year, said the budget size was retained in order to keep zero deficits for the incoming government.

A breakdown shows that education got N82.11 billion or 16.6 per cent as against N77.42 billion or 15. 81 per cent recorded in 2014.

His words: “We have retained essentially the same budget size as 2014. This is for many reasons. One reason is that we have kept a zero deficit in order to ensure that the next government does not inherit a deficit. This will give them room to start off very quickly when their programmes begin to crystallize and they may need to raise funds in order to start off.”

Bayelsa: Dickson proposes budget of completion

Governor Seriake Dickson of Bayelsa State said his 2015 N320.6 billion “Budget of Completion,” which comprises N175. 78 billion (54 per cent) recurrent expenditure and N144. 84 billion (45.2 per cent) capital expenditure would be judiciously implemented.

He assured that most of the ongoing projects in the health sector would be completed, particularly the five new referral hospitals under construction, Melford Okilo Memorial Hospital and rehabilitation work on over 30 health centres across the state.

Cross River: Imoke promises to stimulate economy

In Cross River, Governor Liyel Imoke said his N149.443 billion “budget of transition” would commit 60 per cent to capital development while 40 per cent would be used to service recurrent expenditure, stressing that economic sector would gulp 47 per cent of the budget.

“The economic sector has the highest allocation in the 2015 budget proposal. This is understandable as the sector is expected to stimulate the entire economy of the state and create jobs for our unemployed youths. The budget focus for the agricultural sector for 2015 would be on youth employment through value chain development, and using the sector to provide a source of livelihood to our women as well as wealth creation,’’ he said.

Osun: We will boost IGR without increasing taxes –Aregbesola

In his 2015 ‘Budget of Renewed Hope’, Governor, Rauf Aregbesola, proposed to spend N197.8 billion as against the N234 billion he spent in 2014.

The total recurrent expenditure is N87 billion while capital expenditure is N110 billion.

In the proposed budget, the Economic Sector, covering agriculture and rural development, rural/urban electrification, commerce, industry, finance and transportation accounted for the largest chunk with N41.6 billion.

Aregbesola said that the budget would ensure the completion of on-going projects and commencement of new ones for the comfort of the people. He noted that extra efforts would be made to generate more revenue internally, especially through collection of existing taxes and rates without necessarily imposing new tax regime on the people.

We will block wastages in Borno –Shettima

To ensure that his N175.9billion budget makes impact in his insurgency ravaged state, Governor Kashim Shettima said his ‘budget of fulfilment’ comprises N62.9 billion as recurrent expenditure and N113 billion as capital expenditure.

Shettima said the budget tis geared towards completing all ongoing projects and embarking on new ones that are necessary for the achievement of set goals and objectives of improving the living conditions of the people of the state and boosting the economy.

His words: “We shall mobilize all available resources and human capital to ensure that the targeted objectives are achieved, especially peace and stability, conducive environment for small and medium scale business to thrive, improving agriculture to generate employment opportunities to the youths and introduction of mechanized farming.

“Considering the fact that our projections are ambitious, while our resources are limited, we shall explore all avenues of revenue generation to compliment the statutory allocations from the federation account which has dwindled in view of the general downward trend for oil prices in the international market.”

He stressed that all wastages will be blocked and prudence, accountability and transparency will be maintained in the management of public funds.

– See more at: http://www.vanguardngr.com/2015/01/austerity-measure-well-cushion-effects-govs/#sthash.HfTw1frQ.dpuf

Source: Clifford Ndujihe, Vanguard NG

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