It is no longer news that the fear of the unknown in Nigeria now is occasioned by the dwindling fortune of oil in the international market. Nigeria’s major revenue earner now sells below $38 per barrel. But what has yet to be seen is how the Federal Government and the 36 states will weather the storm in 2016. Already, the Federal Government has disclosed that it is going for foreign loans to finance its 2016 budget, and has opted for a loan of N1.8tn. For some states, plunged into unprecedented debt by previous administrations, going for foreign loans to finance their activities may not be a viable option.
In Ogun State, at least, the signs of what to come have begun to manifest. The ray of hope appeared on the horizon on Tuesday, November 24, 2015 when Governor Ibikunle Amosun presented the 2016 Budget to the state House of Assembly. To say the least, it is obvious that the Ogun State Government did not deceive itself over what the financial environment would look like in 2016.Amosun, working closely with the appropriate committees of the House of Assembly in preparing the budget, showed that he did not set out to deceive the people of the state. The budget, christened, “Budget of Optimisation”, has a total estimate of N200.27bn which falls short of the N10.2bn for 2015. While some states might have considered the usual bogus budget estimates that characterised past years when petrodollar flowed like rain water, Amosun chose not to play to the gallery. Ogun State is one of those states in the country where the culture of paying tax is a taboo and almost alien to the people. The government has looked inwards and thinks out of the box tosatisfy its people. The contents of the 2016 Appropriation Bill clearly show that this is exactly what the state government has done. Among the objectives of the budget are diversification of the economy from Federation Account allocation-dependent to exploitation of our natural endowments and widening the tax base for the socio-economic development of the state and exploitation of raw materials (solid minerals); no pay cut or retrenchment of workers; prompt payment of workers’ salaries, pensions and gratuities of our retired senior citizens; aggressive IGR drive; radical approach towards reducing the level of poverty among the citizenry through provision of conducive environment for job creation and wooing of investors to the state and completion of ongoing capital projects among others.The government knows that it is imperative that growth and development in the state are inclusive and the connectedness of local governments will be covered in this initiative.
But in line with the industrial plan of the state, some areas around the Old Abeokuta-Lagos Road, the Lagos-Ibadan Expressway, the Sagamu-Ogijo area, Papalanto interchange and Ota-Agbara area have been designated as industrial clusters for prospective investors.Also, attractive incentives are being offered to investors wishing to acquire land for business; with these incentives, over 70 industries are said to have been established in Ogun State since the investment drive commenced in 2011, and a combined capacity of these companies has generated over 300,000 jobs for unemployed youths in the state.About 20.97 per cent of the budget is expectedto be funded by the revenue from the Federal Allocation Accounts, while the Internally Generated Revenue is expected to fund 53.93 per cent. Furthermore, external loans and grant are 20.11 per cent and 4.99 per cent respectively.Interestingly, N99.29bn (49.6 per cent) was earmarked for capital expenditure, while N 100.98bn (50.4 per cent) will be spent on recurrent expenditure.
The speedy passage of the appropriation bill by the state House of Assembly attests to the claim by the governor that the Assembly was carried along from the conception stages of the budgeting process.It is our prayer that the desire of the administration not to give the people a false sense of financial security will translate into expected results and that the people will key into the current economic realities for government to serve them better.


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