The Lagos State Executive Council has approved a review of the state’s 2020 budget by 21 per cent.
The state Commissioner for Economic Planning and Budget, Mr Sam Egube, made this known at a press briefing on Thursday in Lagos.
Egube said this was to help mitigate the economic and social headwind precipitated by the coronavirus pandemic on the state.
He said the budget would be reduced to N920.5 billion against N1,168.6 trillion, hitherto approved by the State House of Assembly.
While giving the breakdown of the revised budget, he said, “The total budget size is reduced by 21 per cent from N1,168.6 trillion to N920.5 billion with the financing deficit increasing slightly by 11 per cent from N97.5 billion to N108.1 billion.
“Recurrent expenditure (Debt and Non-Debt) declined by 10 per cent from the initial N457.5 billion to N411.61 billion and total capital expenditure reduced by 28 per cent from N711.033 billion to N508.9 billion.
“The revised total revenue represents a drop of 24 per cent from the projected N1,107.03 billion to N812.5 billion.”
The commissioner listed some of the factors that necessitated the review of the 2020 budget to include a fall in crude oil prices with damaging effects on statutory allocation expectations, downward pressure of IGR, and devaluation of the Naira.
He added that reduced public and private investment, increased inflation, a decline in demand for goods and services, and a reduction in manufacturing activities portended increased unemployment and lower GDP growth.
Egube said part of the state’s holistic approach to COVID-19 shock already adopted by the state government included maintaining a strong pandemic response, restarting the state economy, and re-imagining the way of the state’s operations.
“To restart the economy, we are going to optimise the state’s budget for investments in jobs and priority sectors through jobs creation, economic stabilisation, and fiscal consolidation.