Lagos State Government has said that the deficit of N521.275 billion of the 2022 budget will be funded through N1.237 trillion targeted revenue.
The Commissioner for Economic Planning and Budget, Mr Sam Egube, made this known on Friday in Ikeja, during a news briefing on the analysis of the Year 2022 Budget, tagged: “Budget of Consolidation”.
Egube said that the budget deficit would be funded by a combination of internal, external loans and bond issuance.
He said that the deficit funding requirement of ₦521.275 billion was at 21 per cent of debt service to total revenue of the state.
Recall that a proposed Year 2022 Appropriation Bill of N1.388 trillion was presented by the State Governor, Mr Babajide Sanwo-Olu to the Lagos State House of Assembly for consideration and assent on Nov. 24, 2021.
Also, an amended Bill of N1.758 trillion was subsequently passed on Dec. 29, 2021 by the State House of Assembly and was signed into law by the Gov. Sanwo-Olu on Friday Dec. 31 2021.
This was after a very rigorous bilateral engagement with the respective Ministries, Departments and Agencies (MDAs).
Egube said that the total budget size of N1.758 trillion would be funded from a total revenue estimate of N1.237 trillion.
This comprises the Total Internally Generated Revenue (TIGR) of N980.654 billion, Capital Receipts of N142.743 billion and Federal Transfer of N256.268 billion.
Egube said that 73.5 per cent (N599,04 billion) of the projected TIGR is expected to be contributed by Lagos State Internal Revenue Service (LIRS), while about 19.2 per cent (N156.65 billion) is expected to be generated by other MDAs of government.
“We shall achieve this by expanding the tax net with the deployment of technology, economic intelligence, through data gathering and analysis amongst other initiatives.
“We believe that there are huge revenue generating opportunities in the informal sector, including real estates, transportation and trade.
“The deficit of N521.275 billion is projected to be funded by a combination of internal, external loans and bond issuance.
“The approved 2022 Budget of N1.758 trillion made up of N1.167 trillion Capital Expenditure and N591.281 billion Recurrent Expenditure, resulting in a Capital to Recurrent ratio of 66:34, is strongly in favor of Capital Expenditure.
“Total Revenue is estimated at N1.237 trillion while deficit funding requirement is N521.275 billion, which at 21 per cent of debt service to total revenue is within the fiscal sustainability benchmarks of 40 per cent,” Egube said.
He said that the overriding budget objective is to achieve a budget of consolidation to substantially complete existing and ongoing infrastructure project essential to statewide economic and social development.