Lagos State is economically and financially solid, contrary to the report by BudgIT. The state’s Commissioner for Finance, Dr. Rabiu Olowo, in a statement issued yesterday, stated that the state continues to meet all its recurrent and loan service obligations.
BudgIT, a public finance analyst, in a report titled “Ability of States to Meet Monthly Recurrent Expenditure and Loan Repayment Obligations, 2019,” had stated that the state was having issues with fiscal sustainability. Olowo noted that although BudgIT has apologized for the error in the report, the government’s statement is meant to present the facts to the public.
He said that the information published by Budg- IT was “incorrect, inaccurate and a gross distortion of the actual facts.”
Citing figures from the state’s published 2019 audited financial statements, which show total revenue for Lagos stood at N644,762,788,340.04, while recurrent expenditure and loan repayment obligation and the surplus or deficit components stood at N554,241,725,038 and N90,521,063,302.04, respectively, the commissioner said: “As indicated in Lagos State’s published Financial Statements, the information in the table published by BudgIT should have correctly indicated a surplus of N89 billion.”
He further stated: “Lagos State Government continues to efficiently explore options in both the Financial and Capital Markets, to extract optimal funding solutions, which will enhance the administration’s ability to deliver on the construction, renewal and improvement of the deficit in social and physical infrastructure for the benefit of Lagosians; who represent 10% of Nigeria’s population.
“In the year under review (2019), Lagos State restructured all existing internal loan facilities to 14% per annum, from between 18% and 20% per annum. These rates have even more recently been re-negotiated to circa 12% per annum. “Lagos State is the only state that is not reliant on the allocation from the Federal Account Allocation Committee (FAAC) with Internally Generated Revenues (IGR) representing circa 72% of the state’s aggregate revenues to enable it address challenges faced by mega cities world over.
“Lagos State is economically and financially viable and the Government of Lagos State continues to expand funding sources whilst also ensuring that prudence and sustainability are at the fore of all funding and expenditure decisions.”