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Faith Awa Maji, Lafia
Nasarawa State Governor, Engr Abdullahi Sule Tuesday, has signed into Law the revised 2020 Appropriation Bill.
It would be recalled that the Governor signed into Law the 2020 Fiscal Appropriation document on Monday, 30th December, 2019 of One Hundred and Eight Billion, Four Hundred and Forty-four Million Eight Hundred and Five Thousand, Six Hundred and Fourteen Naira (N108,444,805,614.00) only.
Following the signing, the state government started the implementation of the law on 1st January, 2020 as a responsive Government in accordance with the provision of the law, which stipulates that the accounting year shall begin from 1st January to 31st December, 2020.
This is the first time that Nasarawa State Government under the leadership of Gov Abdullahi Sule began the execution of its fiscal policy strategy on the day it was supposed to begin.
“It is important to note that, in the process of implementing the 2020 Appropriation Law, the world witnessed the sudden upsurge of a novel pandemic of Coronavirus tagged Covid-19 which is still ravaging the global economic system. The virus has shutdown global economic activities rendering capital markets ineffective for income generation and purposeful development”.
However, according to Gov Sule, his administration has remained committed and focused on its determination to provide good governance based on reality that is anchored on the principles of transparency and accountability to the State.
“This we belief is geared towards uplifting the living standard of our people and transforming the State into a viable socio-economic and prosperous entity.
“It was based on these realities that it became imperative to present another Appropriation Bill to our esteemed House of Assembly within the mid-year of 2020.
“The revised version of the 2020 Budget is in line with the reality of the expected income due to the COVID-19 pandemic”.
It would be recalled that the House of Assembly has in Thursday, 23rd of this month deliberated on the revised fiscal document and passed into Law which show demonstration collective commitment of both the executive and legislative arms of government to the development of Nasarawa State.
The Nasarawa State number one man said that the world is witnessing the ravaging nature of the coronavirus pandemic noting that his administration has made significant landmarks in the control and containment of the spread of the virus in the State.
“I am happy with the manner in which our medical personnel are demonstrating their professionalism in containing the disease, as well as handling those infected. No amount of money can actually pay for the sacrifices they are rendering in this regard.
“In this connection, Isolation Centers have been provided by Government in most parts of the State for quick and easy access to those infected. We will continue to provide welfare to the health personnel within the limited resources at Government disposal in order to spur them, as well as to show Government’s appreciation for the enormous sacrifices”.
He noted that the state government has provided medical equipment to the Isolation Centers which it will continue to provide more as once the state government’s resources can afford.
“This was the major reason why Governments in most part of the world have reversed their budgets and Nasarawa State cannot be left out”.
Governor Sule stressed that in spite of the negative trends of the economy, the State is committed to ensure total development hence, the provision of basic infrastructure that have direct bearing in the lives of the people, where he said, some major roads construction such as Mararaba – Udege Road, Sisinbaki – Farin Ruwa road, Bus Terminals at Lafia and Karu, and other Feeder Roads within the State have commenced in enest.
“This Administration shall ensure the completion of all viable projects started by the previous Administration such as the Cargo Airport at Lafia, Lafia – Keffi Road, Adudu – Azara – Wuse – Plateau Border Road amongst others. We want to re-emphasize that, we shall not neglect the remaining Lafia Township Roads and other Urban Roads in the State. We shall continue to uplift the health facilities in the State and also elevate infrastructure in the education sector”, he said
Engr Abdullahi Sule has again reiterate that, in consonance with the reality of the current financial position, Government will be strict in expenditure control to ensure efficiency in spending and accountability.
“I want to believe that the Bureau for Public Procurement has put in place mechanism for effective monitoring of Ministries, Departments and Agencies (MDAs) to strictly comply with budgetary provisions and fiscal control”.
The State Governor then said he is aware of the Budget Preparation Committee on the state who meet severally to brainstorm on the reality of the effect of COVID-19 on the general income to the State.
“Therefore, in reversing the 2020 budget, they were guided by the Macro-fiscal and Mineral Sector Assumptions as projected by the Federal Government when making submission of the Medium-Term Expenditure Framework (MTEF) to the National Assembly, as well as the trend in the global capital market. Our assumptions are essentially dependent on the Federal Government Fiscal Strategy Paper, since the Solicitors Regulation Authority (SRA) is the major source of revenue to the State”.
The followings were the are assumptions to include,
Crude Oil Price, in the original approved budget, the State’s assumption for crude oil price was $57 per barrel. However, in the revised budget, crude oil price is $20 per barrel. This crash was caused by the Coronavirus.
Oil Production, following the low oil price in the global market, Nigeria cuts its oil production from 2.2 million barrel per day to 1.7 million barrel per day. This means Nigeria will earn less.
Exchange Rate, Exchange Rate of US$305 was projected in the original budget but Government has reviewed the rate upward to $360 to reflect the current economic realities.
GDP Growth Rate, in the original approved budget, the GDP Growth Rate was 2.98%. However, in the revised budget it was projected at -4.42%. This negative GDP growth rate is influenced by the larger than expected storms to global value chains due to the Coronavirus, affecting global demand for goods and services.
Inflation Rates, Inflation Rate has been revised from 10.80% in the original budget to 14.13% in the revised budget. This increase in inflation rate is based on the April 2020 Consumer Price Index (CPI) Report recently released by the National Bureau of Statistics (NBS) for activities in March 2020.
On the basis of the assumptions above, aggregate revenue is projected at Sixty One Billion, Seventy Four Million, One Hundred and Eight Thousand, Eight Hundred and Eight Naira (N61,074,108,808), while the expenditure outlay is estimated at Sixty Two Billion, Nine Hundred and Sixty Eight Million, Three Hundred and Forty Eight Thousand, One Hundred and Thirty Eight Naira (N62,968,348,138) only. The deficit of N2.505 billion is expected to be financed through internal and external borrowings.
Accordingly, the 2020 Amended Appropriation Law is Sixty Two Billion, Nine Hundred and Sixty Eight Million, Three Hundred and Forty Eight Thousand, One Hundred and Thirty Eight Naira (N62,968,348,138) only which translates into the total expenditure outlay.
This shows that the original 2020 budget of the State was reduced by 41.94%, that is, from N108,444,805,614 to N62,968,348,138.
In keeping faith with the original plan, the Governor said his leadership is still christened the Revised Budget as “Amended Budget of Inclusive Development” which was due to the present administration’s philosophy anchored on transparency, accountability, prudence and inclusiveness in the discharge of its responsibilities to the good people of Nasarawa State.
The recurrent expenditure which the COVID-19 pandemic has escalated the Nasarawa State expenditure requirements, it has reflected in two ways; first is the need for the State to implement an expansionary fiscal policy, to recharge the economy, and second is the reallocation of expenditure to focus more on support to specific sectors such as health, providing welfare support to the vulnerable, and a shift to other priority and high impact projects that are driven primarily by economic rationale and not political expediency.
The total recurrent budget decreased by 37.78%, that is, from N58,670,129,609 to N36,502,715,764 only.
Capital Expenditure, in selecting the capital projects as COVID-19 response expenditure, Government first and foremost identified the challenges arising from COVID-19 and developed clear plans, objectives and strategic options for responding to the challenges that will help the State to identify expenditure items for responding to COVID-19.
Therefore, the Capital Expenditure of the State was reduced by 46.83% using the plans, objectives and strategic options to select the projects. The original capital budget was N49,774,676,004 but reduced to N26,465,632,374 in the Revised Budget.
COVID-19 Responsive Expenditures, the COVID-19 responsive expenditure is very essential to Government.
As stated earlier, the revision of the 2020 budget is in response to the effect of the COVID-19 pandemic. In line with this, Government will ensure that COVID-19 responsive projects/programs are projects that meet the broad definition of COVID-19 response expenditures.
He added that the unfolding health and economic crisis demand bold action, Government is therefore, poised to draw on practical support to rapidly scale up its healthcare system and its capacity to contain the likely escalation of the impact of the COVID-19 pandemic, especially, as it progresses to the most vulnerable areas, disrupting millions of people’s livelihoods, with a disproportionate impact on poor households and small and informal businesses.
Gov Sule assured that his administration has developed a comprehensive blueprint, Nasarawa COVID-19 Economic Response for responding to the challenges of the Pandemic which he said the Revised 2020 Budget is aimed at allocating resources towards strategic Government objectives and strategic options provided in the blueprint. Government deliberately provided a COVID-19 responsive expenditure of 17.56% total expenditures in the Revised Budget.
He listed some of the strategic areas covered in the 2020 Amended Budget as follows:
Payment of hazard allowance to health workers and other response activities.
Increasing hospital beds, quarantine/isolation facilities, equipment and consumables.
Improved agricultural productivity to increase source of income for our citizens.
Provision of access to food producing areas to access health facilities and increase food distribution in the State.
Provision of stimulus package/ loan/support to help our citizens navigate out of the crises.
He added that there is no double the state is in a very trying times and appeal for the understanding of the people of Nasarawa State as state government continue to evolve measures to cushion the envisaged consequences of the situation
