Economy Finance News Oil & Gas

States Disagree with NEITI on 2019 Budget Funding

State governments have disagreed with the Nigeria Extractive Industries Transparency Initiative (NEITI) that many of them would not be able to fund their 2019 budgets.

The states said they had funded their previous budgets successfully, and that this year’s wouldn’t be different, especially now that their Internal Generated Revenues (IGRs) are moving northward.

NEITI had said about 28 states’ IGR and their monthly allocations from the Federal Government could not fund their 2019 budgets.

It hinged its reason on the fact the allocations the states are getting have been going down, and their IGRs are nothing to write home about.

The combined net allocations for 2017 and 2018 are inadequate to fund 2019 budgets of 35 states, NEITI said.

It added that total revenues to states for 2017 and 2018 are inadequate to fund 2019 budgets of 28 states, this even as disbursements to states had dropped below N2trillion first time since second quarter 2018.

But as gloomy as this appears, the states said there is nothing to worry about.

Kogi sees hope in rice project

The Kogi State Commissioner for Finance, Alhaji Asiwaju Idris Asiru said though he has not read the (NEITI) report, he was however confident that the state’s 2019 budget tagged “Budget of Consolidation” will be funded.

“For instance, we have a massive rice project in Ejiba which is expected to boost the revenue profile of the state.

“We are equally going to develop the smallholder farmers along this value chain such that they also can be paying little taxes to the government.

“Apart from that, we have been able to pluck a lot of leakages in the state’s internal revenue generation system to enable them meet set target’’, he said.

He said the state internal revenue service had been given the target to generate N22 billion for the state this year and had been striving in that direction towards increasing the state’s revenue profile.

Plateau to increase IGR, reduce spending Plateau State Government said it will rely more on increasing Internally Generated Revenue (IGR) and reduce spending in order to fund the 2019 budget and pay the N30, 000 minimum wage.

The State Commissioner of Information and Communication, Yakubu Dati said the state government was fast tracking the demolition and rebuilding of the Jos Main Market which is a major revenue earner as well as increase the development of solid minerals and the potatoes value chain to address the financial challenges.

Benue: We’ll plug leakages, cut costs

The Chief Press Secretary to the Governor Samuel Ortom, Terver Akase, said, “our plan as a government is to look inwards and see how we can generate more funds. We will improve on our IGR, plug leakages and continue to cut the cost of governance as Governor Ortom is already doing.

That way, we believe that Benue will overcome the financial challenge ahead.” ‘Financial reforms make Yobe among eight solvent states’ Yobe state commissioner for finance, Alhaji Ismaila Nguru, said financial reforms embarked upon by Governor Ibrahim Gaidam has made the state buoyant to finance all its budget, without borrowing from any financial institution.

Speaking to Daily Trust against the backdrop of 28 states that cannot fund their 2019 budgets from the combined revenue of 2017 and 2018 budget, Nguru said it takes diligent political leadership to achieve that.

Jigawa: We wouldn’t embark on project without financial strength

Contacted on whether the state government would be able to finance its 2019 budget, the Jigawa state government spokesperson, Bello Zaki, said since coming to power of the present administration, the annual budget achievement of the state is within the region of 82 percent.

“In Jigawa state, we carry forward good balances to the next fiscal year. This indicates we have been moving along with our savings. In Jigawa state, we are very conservative in our budgetary estimates, we don’t budget for what we don’t have provision for’’, he said.

Innovations secret of our IGR improvement – Lagos

The Lagos State Commissioner for Finance, Akinyemi Ashade said adoptions of Innovations, new technology, among other measures have been helping the state to raise its Internally Generated Revenues (IGR).

Ashade who disclosed that the State succeeded in raising its IGR to the average of N34 billion in 2018, is actually targeting to raise it to N50 billion this year.

How states can improve their revenues – Experts

Meanwhile, an analyst with GTI, Damilare Asimiyu, said states should tap into their endowed resources to improve on their IGR.

“Until each state begin to maximize what it has, they will never get anywhere with FAAC allocation and the current IGR’’, he said.

He said a state like Lagos can rely on its tax base to meet its target while other states may need to look to agriculture to develop their taxable base Moses Ojo, head research, Pan African Capital said: “Looking inward is not necessarily about tax increase because of the weakness in consumer spending as a result of exchange rate devaluation and the impact of inflation.

They have to look at a public private partnership” The Director-General, Lagos Chamber of Commerce and Industry (LCCI), Muda Yusuf suggested that states should make budgets that are realistic.

(Daily Trust)

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