2021 Benue budget: Full details of presentation by Gov Ortom
ADDRESS BY GOVERNOR SAMUEL ORTOM AT THE PRESENTATION OF THE 2021 BUDGET ESTIMATES TO THE BENUE STATE HOUSE OF ASSEMBLY IN MAKURDI ON THURSDAY, 5TH NOVEMBER 2020
BUDGET OF RESILIENCE
PROTOCOLS
1. It is with great pleasure and fulsome appreciation of the will of God Almighty that I present today the 5th Day of November 2020, the Benue State Government Budget Estimates for Fiscal Year 2021 for consideration and appropriation. God alone deserves all the praise for preserving and protecting our people and keeping us safe in the face of the COVID-19 pandemic. I am sure you will join me in commending all the good people of Benue State for their willing cooperation and sacrifice in respecting the restrictions and enduring the disruptions that have been necessitated by our collective fight against this pandemic.
THE DEVELOPMENT CONTEXT: CHALLENGES AND PROGRESS
2. Mr. Speaker, Honourable Members, we are all witnesses to the fact that 2020 has been a difficult year for the world and for our country and our State. Millions of people worldwide have tested positive to the COVID-19 pandemic already, with hundreds of thousands of deaths worldwide. Nigeria now has over 63,000 confirmed infections and 1,151 deaths as at yesterday. While all States have been affected, Benue has been spared the worst of the pandemic, with 493 cases and 11 deaths. The country has only started emerging from a prolonged lockdown that lasted several months. There are lingering concerns that, as testing expands, the nationwide infection and mortality rate might climb higher due to a combination of community infection and limited national capacity to provide the required care for large numbers of cases.
3. In the circumstances, therefore, we should be thankful to God that Benue State has recorded relatively modest numbers of infections and deaths so far. We are also encouraged by this result to continue with the vigorous preventive measures and emergency preparedness that have been the hallmarks of our State response. We commend and appreciate the work of our State Action Committee on COVID-19, led by His Excellency the Deputy Governor, and all those who have been diligently serving in the frontline and the back end of our relatively successful response to the pandemic.
4. Mr. Speaker, Honourable Members, while our State has so far been able to contain the public health impact of COVID-19 on our people, we are still grappling with the economic and fiscal impact of the global and national economic crisis that forced us to revise our original 2020 budget downward in July. You will recall that the State Assembly reviewed and passed the original fiscal year 2020 State Budget in record time, which paved the way for me to sign it on 30th December, 2019 and for implementation to start on 1st January, 2020.
5. It was less than three months into the year, however, that the implementation of the 2020 budget suffered severe disruptions from the impact of the crude oil price war between Russia and Saudi Arabia and the outbreak of the pandemic, which forced us to a 43 percent downward revision of the budget which you graciously considered and passed in July 2020.
6. Mr. Speaker, Honourable Members, the economic pressures and fiscal constraints that prompted the 2020 downward budget revision are still very much with us, and the outlook for 2021 and beyond is not rosy. In addition to these is the high rates of unemployment and poverty, insecurity, youth restiveness and breakdown in citizens’ trust of Government that have been highlighted in the recent ENDSARS protests. We can all see that the country is going through challenging and uncertain times.
7. Mr. Speaker, Honourable Members, navigating these challenges and uncertainties requires Governments at all levels to improvise and to adjust. We as leaders cannot just lament how bad things are; we must lead in finding solutions. For us in Benue we are inspired by how God has helped us thus far to come through numerous challenges in the time we have been entrusted with the leadership of our State.
8. Mr. Speaker, Honourable members, you will recall that soon after taking office in 2015 we had to suffer through a recession, the first in over two decades. We have experienced the brutal devastation of invasion by murderous herdsmen that threatened our very existence in this country. Both in 2015 and 2019 we have had to fight long-drawn court battles over the mandate that our people freely and overwhelmingly gave to us. Now another recession is upon us that has the potential to bite deeper and longer than anything we have seen, while the rampaging COVID-19 is the biggest health crisis in over a century and has caused the greatest economic disruption since the end of Nigeria’s civil war. In fact, the pandemic has already reset the world such that no-one knows what the new normal is or will be. Our lives and our economy are in an existential fight for survival, and things will never be the same again.
9. While, humanly speaking, it would have been better if we did not have to contend with all these challenges, we cannot be dismayed or fearful about our prospects as a people and as a Government. God who knows all things brought us into office for such a time as this. Indeed, we have a lot to thank God for. We thank Him that our State has not seen the worst of the pandemic. We thank Him that He has enabled us to make so much progress in service delivery to our people over these last five years despite all the challenges.
10. Mr. Speaker, Honourable Members, permit me to highlight just a few of these areas of progress to remind us of how far we have come and to encourage us as we strive to prevail against these unprecedented challenges.
(a) We have already built or completed hundreds of kilometers of roads infrastructure and numerous rural electricity projects across the State.
(b) We have aggressively promoted agricultural mechanization through the acquisition and distribution of Tractors and are following up with investments in land clearing and development.
(c) We have revamped hundreds of schools and health facilities at primary, secondary and tertiary levels.
(d) We have secured and preserved accreditation for our key health sector institutions.
(e) We have transformed technical education by increasing the number of Polytechnics.
(f) We are working hard to revamp moribund urban water projects along with projects in rural water supply as well as watershed and Environmental Management and Sanitation.
(g) We have also recorded considerable progress in restoring and revamping public structures across the State.
(h) We have passed and implemented new Laws and Programmes to improve security and public safety, including by reducing incidents of herdsmen attacks and curtailing violent crimes.
(i) We have created new institutions to strengthen public sector governance and the management of public finances by institutionalizing greater fiscal responsibility, open and competitive public procurement, better management of our debt and improved revenue administration.
(j) We have created a new Ministry to drive progress in the areas of Energy, Science and Technology.
(k) We have started an online State Television Station that we are now transforming into a Cable Broadcast Station.
(l) We have created the institutional framework for the effective and sustainable management of our Pension Administration.
(m) We have continued to take the required steps to protect the safety and security of our people.
11. Indeed, as we have started commissioning some of these projects, I notice that many of our people are pleasantly surprised by how much we have accomplished in the face of all the challenges.
12. Mr. Speaker, Honourable Members, this record of progress gives us the assurance that despite the challenges we remain on course to realise our vision for Benue State. That is the vision of an economically self-reliant and prosperous federating unit of Nigeria that is anchored on the fear of God.
13. This vision is not a pipe dream or a casual political slogan that we can abandon in the face of challenges or setbacks. We are committed to realizing the vision, knowing that God has endowed us with the human and natural resources that we can harness towards achieving it. Lest the current challenges tempt us to despair about our prospects, let us call to mind the assuring words of our State Anthem, that God will give us victory over all the giants on our way provided we are on the righteous side with Him. The faith and the resilience that have brought us this far will avail for us as we look ahead. That is the spirit that we have taken into our preparation of the 2021 budget that we are presenting here today.
REVIEW OF THE PERFORMANCE OF THE 2020 BUDGET
14. Mr. Speaker, Honourable Members, the 2020 Budget was christened the “Budget of Advancement, Growth and Development”. Our focus was to step up the charge towards making Benue an economically self-reliant federating unit of Nigeria following the work done to recover from the effects of the 2015 elections and the security challenges and humanitarian crises hallmarked by the herdsmen invasion of 2018. But we soon had to revise the budget in the face of the global and national economic downturn caused by the oil price war between Russia and Saudi Arabia and subsequently compounded by the disruptive impact of the COVID-19 pandemic.
15. The revised 2020 Budget anticipated aggregate revenue estimates of One Hundred and Eight Billion, Eight Hundred and Twenty-Two Million, Six Hundred and Eighty-Three Thousand, One Hundred and Eighty-One Naira (N108,822,683,181.00) only. This amount was appropriated into Personnel cost, Overhead cost and Capital Expenditure as follows:
Table I: Revised 2020 Allocation of Recurrent and Capital Expenditure
| A. RECURRENT EXPENDITURE N68,338,978,786.00 |
| i. Personnel Cost N37,286,131,793.00 |
| ii. Overhead Cost N31,052,846,993.00 |
| B. CAPITAL EXPENDITURE N40,483,704,395.00 |
| C. TOTAL N108,822,683,181.00 |
PERFORMANCE OF THE 2020 REVENUE BUDGET
16. By the end of the second quarter of 2020, the State realised the total sum of Forty-Seven Billion, Four Hundred and Eighty-One Million, Six Hundred and Eighty-Seven Thousand, Two Hundred and Ninety-Eight Naira and Twenty-Four Kobo (N47,481,687,298.24) only, representing 43.63 percent of the approved aggregate revenue estimates.
THE 2020 EXPENDITURE PERFORMANCE
17. As earlier stated, the total expenditure outlay of the revised 2020 revised budget was One Hundred and Eight Billion, Eight Hundred and Twenty-Two Million, Six Hundred and Eighty-Three Thousand, One Hundred and Eighty-One Naira (N108,822,683,181.00) only. Whereas the sum of Sixty-Eight Billion, Three Hundred and Thirty-Eight Million, Nine Hundred and Seventy-Eight Thousand, Seven Hundred and Eighty-Six Naira (N68,338,978,786.00) only was for Recurrent Expenditure, the sum of Forty Billion, Four Hundred and Eighty-Three Million, Seven Hundred and Four Thousand, Three Hundred and Ninety-Five Naira (N40,483,704,395.00) only was provided for capital development.
18. On the expenditure performance side, the State has expended the sum of Thirty-Eight Billion, Four Hundred and Three Thousand, One Hundred and Thirty-One Thousand, One Hundred Naira and Forty-Three Kobo (N38,403,131,100.43) only as at the second quarter of 2020 on Recurrent items, representing 56.20 percent of the budgeted amount.
19. The sum is made up of Nineteen Billion, One Hundred and Eighty-Six Million, One Hundred and Twenty-Two Thousand, Seventy-Two Naira and Sixty Kobo (N19,186,122,072.60) only expended on Personnel cost, the sum of Nineteen Billion, Two Hundred and Seventeen Million, Nine Thousand, Twenty Seven Naira and Eighty-Three Kobo (N19,217,009,027.83) only used for Overheads cost, while the sum of Nine Billion, Seventy-Eight Million, Five Hundred and Fifty-Six Thousand, One Hundred and Ninety-Seven Naira and Eighty-One Kobo (N9,078,556,197.81) was expended on Capital items. The State Government spent the sum of Eight Billion, Five Hundred and Twelve Million, Four Hundred and Fifty-Eight Thousand, Seven Hundred and Forty-Three Naira, Thirty-Eight Kobo (N8,512,448,743.38) only on Debt servicing. However, Seven Hundred and Ten Million, Sixty-Five Thousand and Twenty-Two Naira and Fifty-Two Kobo (N710,065,022.52) only was refunded by the Federal Government as part of the moratorium on deductions granted in response to the COVID-19 pandemic.
20. Mr. Speaker, Honourable Members, the performance of this budget has been affected by the impact of the aforementioned economic slowdown and the disruptions and uncertainties caused by the COVID-19 pandemic on national and State revenues and the failure of the States to achieve a moratorium on domestic Debt servicing obligations as had been promised by the Federal Government when it offered to serve as a deal broker.
REQUEST FOR SUPPLEMENTARY FISCAL YEAR 2020 APPROPRIATION
21. Mr. Speaker, Honourable Members, as a result of these developments, some Ministries, Departments and Agencies (MDAs) have not been able to expend much of their provisions at the rate anticipated while others have exceeded their provision for certain Sub-heads. In addition, the failure of the Federal Government to broker the Debt Servicing Moratorium agreement with local creditors has caused the unexpectedly huge outlay in debt servicing expenditure. The Executive Council is satisfied that these expenditures were essential and in the best interest of the State.
22. To facilitate your consideration and approval of the request for Supplementary appropriation for fiscal year 2020, we have provided the list of MDAs that have made the various requests for Supplementary provisions and have also shown how these provisions will be sourced from existing appropriated funds that can no longer be utilised in the time available. As the adjustments are within the approved programmes of the revised 2020 budget, the total size of the revised 2020 budget will not be affected.
23. Mr. Speaker, Honourable Members, in light of the foregoing, permit me to present to you a Supplementary Appropriation bill of Twenty Billion, Six Hundred and Eighty-Two Thousand, Six Hundred and Six Hundred and Thirty-Four Naira (N20,000,682,634) only for your consideration and passage into Law.
PRINCIPLES OF THE PROPOSED 2021 BUDGET
24. Mr. Speaker, Honourable Members, in preparing the 2021 Budget Estimates we have focused on programmes and projects that will further strengthen the resilience and recovery of our people in the face of the manifold challenges we have already noted. We need to recover as quickly as possible from the disruptive impact of the economic downturn and the COVID-19 pandemic in order to keep our State on the path to becoming an economically self-reliant federating unit of Nigeria. For that, we need to focus on measures that will enhance our economic recovery and growth. We must support our hardworking farmers and micro, small and medium enterprises to recover and rebuild their operations. We have to find innovative ways to support struggling households and individuals to survive and to thrive. We need to create opportunities for jobs and wealth creation for our teeming population of young men and women and to ensure that they have the education and skills to seize these opportunities.
25. The above are the main considerations underpinning our approach to the 2021 Budget proposals. We have undertaken to be faithful to these considerations even as we remain true to the core public financial management principles of a realistic, responsive and transparent budget preparation and implementation process. These principles include:
(a) provision of infrastructure with positive impact on the ease of doing business and the living standard of the people of the State;
(b) community consultation, mobilisation and engagement in the design and implementation of projects priority projects and programmes;
(c) adoption of technology to block leakages in revenues and expenditure, including Salaries and Pension Payments, and in tracking and reporting budget implementation;
(d) sustaining the implementation of financial management reforms to ensure prudent management of resources, value for money, accountability and transparency in Government revenues, expenditure and debt;
(e) implementation of a comprehensive Pension Reform programme;
(f) utilising the budget as an instrument to achieve the goals articulated in our blueprint – “Our Collective Vision for a New Benue” and the Benue State Development Plan 2016-2025.
(g) controlling the impact of the COVID-19 pandemic on lives and livelihoods;
(h) protecting and promoting economic enterprises to enable them to survive and thrive in the face of economic crisis and the COVID-19 pandemic.
KEY ASSUMPTIONS OF THE FISCAL 2021 BUDGET PROPOSAL
26. Mr. Speaker, Honourable Members, the national macroeconomic situation continues to be uncertain, even as the country itself continues to be unstable in the face of protests, strikes and generalized insecurity. The slight gains that have been recorded in oil price earnings have been overshadowed by the declining value of the Naira, high rates of inflation and an economic recession that is predicted to worsen to an economic depression that has not been seen since 1980. The additional complication is that, unlike the recession in 2016, there are few buffers available to the navigate these headwinds and prevent a rapid and sustained downward slide. From the viewpoint of our State’s 2021 Budget, we have to anticipate a significantly disruptive impact on our projected revenues and expenditure, as already projected in the Federal Government’s revised Medium-Term Expenditure Framework. We are therefore planning on the basis of the following assumptions:
(a) benchmark crude oil price of $40 per barrel and oil production at 1.86 million barrels per day;
(b) revenue accruals will improve with respect to the statutory allocations and the Value Added Tax (VAT)
(c) exchange rate of N379 to the dollar will remain stable;
(d) inflation rate of 11.95%;
(e) revenue sharing formula holds steady or improves with respect to the Statutory Allocation and Value Added Tax (VAT) distribution to the States;
(f) continued institutional strengthening of internally generated revenue collection in the State in collaboration with the Local Government Councils;
(g) blockage of leakages in internal revenue generation by our MDAs and remitting of all collections into the Government’s Treasury Single Account;
(h) further acceleration and strengthening of the financial management reforms embarked upon under the World Bank-supported State Fiscal Transparency and Sustainability (SFTAS) programme for results, which will earn enhanced revenue for improved results;
(i)successful takeoff of the new World Bank-assisted Nigeria COVID-19 Action Recovery and Economic Stimulus (N-CARES) programme-for-results;
(j)other commitments with our development partners will be further strengthened;
(k) herdsmen attacks and other clashes and forms of criminality are eliminated or reduced;
(m) goodwill of domestic and foreign creditors, investors and development partners in respect of debt servicing reliefs and emergency financing and aid;
(n) no new wave of lockdowns or restrictions of movement due to the COVID-19 pandemic and a broader and rapid reopening of all segments of the national economy;
(o) an end to the ENDSARS protests and no further threats to stability and predictability in the national and global political economy.
PROPOSED YEAR 2021 BUDGET OF RESILIENCE
27. Mr. Speaker, noting the above assumptions and taking into consideration the need to strengthen the resilience of our people and our state as we seek to recover from the global, national and sub-national economic and pandemic crises, we are now proposing the total sum of One Hundred and Thirty-Two Billion, Five Hundred and Ninety-Two Million, Forty-One Thousand, Three Hundred and Ten Naira (N132,592,041,310.00) only for approval as revised estimated aggregate revenue from all sources in fiscal year 2021. The 2021 budget estimate revised estimate figure represents an increase of Twenty-Three Billion, Seven Hundred and Sixty-Nine Million, Three Hundred and Fifty-Eight Thousand, One Hundred and Twenty-Nine Naira (N23,769,358,129) or 18% from the revised year 2020 revenue estimates. The Budget Framework below summarises our revenue and expenditure projections, the details of which are provided in the draft budget document. The Honourable Commissioner for Finance and the Director-General of the State Planning Commission are available to provide any explanatory details as appropriate.
| BENUE STATE GOVERNMENT
2021 BUDGET FRAMEWORK |
|||
| S/No. | Source of Revenue | Revenue Estimates January-December 2021 (Naira) | Of which COVID-responsive* |
| 1 | Opening Balance | ||
| RECEIPTS: | |||
| 2 | Statutory Allocation | 39,707,261,002 | |
| 3 | FAAC Special Allocations | 4,253,264,465 | |
| 4 | Share of VAT | 13,798,146,690 | |
| 5 | Excess Crude | 1,000,000,000 | |
| 58,758,672,157 | |||
| INDEPENDENT REVENUE | |||
| 7 | Tax Revenue | 13,011,500,215 | |
| 8 | Non-Tax Revenue | 6,750,111,237 | |
| 19,761,611,452 | |||
| TOTAL PROJECTED FUNDS: | 78,520,283,609 | ||
| OTHER RECEIPTS/REVENUE | |||
| 9 | Domestic Aid & Grant | 10,371,371,249 | |
| 10 | Foreign Aid & Grant | 10,819,398,195 | |
| 14 | Other Capital Receipts | 233,033,799 | |
| 16 | Transfers to Fund Recurrent Expenditure | 8,837,954,459 | |
| 30,261,757,702 | |||
| DEFICIT FINANCING: | |||
| 18 | Domestic Loans/Bond/Deficit Financing | 23,810,000,000 | |
| 23,810,000,000 | |||
|
EXPENDITURE:
|
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| 20 | Debt Payments Local | 8,500,000,000 | |
| 21 | Debt Payments Foreign | 500,000,000 | |
| 22 | Pension | 2,010,000,000 | |
| 23 | Gratuity | 2,704,218,459 | |
| 24 | Death benefits | 127,380,000 | |
| 25 | NHIS Contribution | 2,269,602,684 | |
| 26 | Contributory Pension | 3,535,586,225 | |
| 27 | Personnel Costs | 38,691,427,898 | 6,584,046,043 |
| 28 | Overhead Costs | 32,472,736,484 | 2,325,404,294 |
| CAPITAL | |||
| 28 | ADMINISTRATION SECTOR: | 3,498,455,059 | 27,500,000 |
| 29 | ECONOMIC SECTOR: | 29,480,684,943 | 8,247,983,407 |
| 30 | LAW & JUSTICE SECTOR: | 602,441,860 | |
| 31 | SOCIAL SECTOR: | 8,199,507,699 | 2,852,373,065 |
| TOTAL EXPENDITURE: | 132,592,041,310 | 20,037,306,809 | |
| TOTAL REVENUE: | 132,592,041,310 | ||
| FINANCING GAP | 0 | ||
| COVID-19 responsive expenditures (% of total expenditures) = | 15 | ||
FISCAL YEAR 2021 REVENUE PROJECTION
28. The State Government’s share of Federation Account Allocation Committee (FAAC) revenue is expected to be the leading revenue source with an estimated figure of Fifty-Eight Billion, Seven Hundred and Fifty-Eight Million, Six Hundred and Seventy-Two Thousand, One Hundred and Fifty-Seven Naira (N58,758,672,157) only. This is followed by Independent Revenue of Nineteen Billion, Seven Hundred and Sixty-One Million, Six Hundred and Eleven Thousand, Four Hundred and Fifty-Two Naira (N19,761,611,452) only. Other receipts are estimated at Thirty Billion, Two Hundred and Sixty-One Million, Seven Hundred and Fifty-Seven Thousand, Seven Hundred and Two Naira (N30,261,757,702) only, while Domestic Bonds, Loans and deficit financing are a combined estimate of Twenty-Three Billion, Eight Hundred and Ten Million Naira (N23,810,000,000) only.
FISCAL YEAR 2021 EXPENDITURE PROJECTION
29. Mr. Speaker, Honourable Members, the proposed aggregate expenditure for fiscal year 2021 is projected at One Hundred and Thirty-Two Billion, Five Hundred and Ninety-Two Million, Forty-One Thousand, Three Hundred and Ten Naira (N132,592,041,310) only. We have proposed that this amount be appropriated into personnel, overhead and capital expenditure as follows:
Table I: 2021 Allocation of Recurrent and Capital Expenditure
| A. RECURRENT EXPENDITURE N90,810,951,749 |
| i. Personnel Cost N49,338,215,266 |
| ii. Overhead Cost N41,472,736,484 |
| B. CAPITAL EXPENDITURE N41,781,089,561 |
| C. TOTAL N132,592,041,310 |
FISCAL YEAR 2021 RECURRENT EXPENDITURE PROJECTION
- The proposed fiscal year 2021 Recurrent Expenditure stands at Ninety Billion, Eight Hundred and Ten Million, Nine Hundred and Fifty-One Thousand, Seven Hundred and Forty-Nine Naira (N90,810,951,749) only, representing 68% of the total budget. This figure is made up of the sum of Forty-Nine Billion, Three Hundred and Thirty-Eighty Million, Two Hundred and Fifteen Thousand, Two Hundred and Sixty-Three Naira (N49,338,215,266) only for Personnel cost, representing 37% of the budget, and the sum of Forty-One Billion, Four Hundred and Seventy-Two Million, Seven Hundred and Thirty-Six Thousand, Four Hundred and Eighty-Four Naira (N41,472,736,484) only, or 31%, for Overhead costs.
- Mr. Speaker, Honourable Members, our recurrent expenditure estimates reflect our continued commitment to faithfully pay the Salaries of our workers and meet our obligations under our new Pension laws, while also keeping faith with the payment of Pensions for those already retired. We have also made provision for essential Overheads expenditure, with emphasis on items of that relevance to our quest to promote resilience and recovery, including grants to poor households and micro, small and medium enterprises to cushion the impact of COVID-19.
FISCAL YEAR 2021 CAPITAL BUDGET EXPENDITURE PROJECTION
32. Mr. Speaker, Honourable Members, as we have seen, the proposed fiscal year 2021 capital expenditure budget is and the sum of Forty-One Billion, Seven Hundred and Eighty-One Million, Eighty-Nine Thousand, Five Hundred and Sixty-One Naira (N41,781,089,561)) only, representing 31% of the total budget.
33. Mr. Speaker, Honourable Members, you will notice that our Capital Expenditure estimates reflect our continuing commitment to job-creating and wealth generating agricultural value chain development, with adequate provisions for key inputs such as land development, mechanisation, provision of inputs to farmers, including fertiliser, seeds and seedlings, irrigation and chemicals, services and access roads and bridges to facilitate the evacuation of produce to markets.
34. Our provision for infrastructure remains the largest component of our Capital Expenditure estimates. Alongside our programme of revamping educational and health infrastructure, we have made ample provisions for 10 critical arterial road projects spanning hundreds of kilometres across the three senatorial zones. We have continued our investment in the critically important Benue Geospatial Information Service (BENGIS) project and we expect to begin to realise its benefits as soon as the coming year. We also intend to continue the construction of Township roads in all our major towns and LGAs to promote economic and commercial activities in the urban economy. We have also provided for labour-intensive rural development projects to improve rural economic infrastructure, provide income and livelihoods opportunities and ensure basic services for the majority of our people in the face of COVID-19. Ample provision is also made to expand water supply across the State, which has been made even more urgent by the importance of water to the hygiene requirements of the COVID-19 response. We have also made infrastructural provisions for the effective take-off of the newly designated Polytechnics in Yandev and Makurdi.
35. Mr. Speaker, Honourable Members, it will come as no surprise to you and your colleagues that we have made special provision for responding effectively to COVID-19 and addressing the challenges and opportunities the pandemic has presented for the present and for the future. Our objective is to preserve lives and promote livelihoods and food security. We have made adequate provisions for the health services sector. We have also made substantial additions to provide specifically for the control of COVID-19 and care for those infected, while other significant provisions are made for interventions to address the impact of the pandemic on fragile livelihoods and businesses. These include budgetary provision for palliatives for poor and vulnerable citizens, the aforementioned agricultural inputs, access roads and basic rural infrastructure to support farmers and protect the food supply chain. We are also looking to facilitate a public-private partnership to establish a major food basket market to boost the sector and create more jobs. We have also provided for relief packages for affected businesses, provisions for operations and research in COVID-19 priority sectors and provision to facilitate access to e-learning across the various levels of education as well as e-commerce. Putting together the previously approved and additional provisions, our overall budget for health, basic services, livelihoods and food security in the context of COVID-19 is Twenty Billion, Thirty-Seven Million, Three Hundred And Six Thousand, Eight Hundred And Nine Naira (N20,037,306,809), representing 20% of our total budget.
36. Mr. Speaker, Honourable Members, it is the objective and policy of the Benue State Government that every young person, male and female, should be in school, work or training. This is important to give every young person prospects for the future and a perspective for life. Both for our recurrent and capital expenditure, we are providing for a robust programme of empowering our youth for the challenges and opportunities of the present as well as the changing world of the future. A major lesson from previous efforts in Benue State and elsewhere is that it is important to carefully target the youth empowerment programmes and projects so that they are effective in providing perspective and prospects. It is not effective to adopt a one-size-fits-all approach as if all youth are the same in terms of background, interests and capabilities. Hence, we are taking necessary steps to ensure that we properly identify and target each category of youth with the appropriate empowerment interventions. We have already set up a Steering Committee comprising a cross-section of the state’s youth which is convening a Youth Summit and will also be mapping the specific needs of the different categories of the State’s youth in order to ensure that empowerment interventions are targeted and effective.
FISCAL YEAR 2021 SECTORAL ALLOCATION ESTIMATES
- The total expenditure as captured in the table above is also distributed across the four major sectors of the State economy as follows:-
- Economic = N51,380,902,302
- Social = N44,523,554,164
- Administrative = N33,846,563,092
- Law and Justice = N2,841,021,752
ANTICIPATED CHALLENGES OF THE FISCAL YEAR 2021 BUDGET
- Mr. Speaker, Honourable Members, we are mindful that the implementation of the proposed 2021 budget will have its challenges. Some of the anticipated challenges, many of which are related to COVID-19, include:
(a) controlling the spread of the pandemic and mitigating its impact of on lives and livelihoods;
(b) the volatility of the global economy and Federation Account receipts as a source of funds for the budget, more so in the face of economic recession and depression;
(c) the narrowing window of alternative sources to finance rising recurrent and capital expenditure;
(d) the management of all outstanding debts, including arrears of salaries and pensions and contract payments;
(e) controlling unexpected herdsmen and communal crises that disrupt production activities;
(f)the risk of widespread lockdowns of economic activities due to outbreaks of disease, protests or other national emergencies.
MITIGATING THE CHALLENGES OF THE FISCAL YEAR 2021 BUDGET
39. While we cannot control all of these risks, we are taking deliberate steps to mitigate their impact on the delivery of the 2021 budget. On the economic and fiscal front, my Administration is diligently integrating the proposals put forward by the Benue State Economic Advisory (BSEAC) to mitigate the impact of the pandemic and prepare us to survive and thrive in its aftermath. This new budget includes some of these recommendations. In addition, the Executive Council has constituted a special Strategy Committee, chaired by me, to fast-track policy actions aimed at developing the agricultural value chain to create jobs for our youth and wealth for our people. The Committee is also working to ensure that revenue is generated and remitted to the Treasury while also strengthening our development partnerships at home and abroad. Specifically on revenue, my Administration will continue to ensure that adequate support and compliance measures are in place to track collection and remittance of all revenues in line with agreed milestones, with sanctions to be applied as part of the enforcement measures wherever necessary.
40. We are also working to improve the quality and impact of our expenditure. To this end we are establishing a budget intelligence unit and also strengthening the existing Efficiency Unit in the Ministry of Finance to monitor the quality of expenditure. We are undertaking state-wide payroll reform, including the deployment of technology using the Nigeria Inter-Bank Settlement System (NIBSS). We are also making good progress towards the comprehensive implementation of the Treasury Single Account. Completion of the BENGIS project which will enhance data for planning and monitoring as well as improve revenue administration. The implementation of the new Laws passed by the Government will certainly strengthen fiscal responsibility, public procurement and debt management.
41. Mr. Speaker, Honourable Members, we are actively productive collaborations with investors, development partners and businesses in the private sector, building on recent and emerging collaborations on various projects and programmes. We will also be taking full advantage of opportunities for States in the recently launched Economic Sustainability Plan of the Federal Government. We also expect that our faithful implementation of the World Bank-assisted States Fiscal Transparency and Sustainability (SFTAS) and the Nigeria COVID-19 Action Recovery and Economic Stimulus (N-CARES) and other existing or new programmes and other effective collaborations with development partners will translate to impact on the ground and in some cases a boost to state revenues.
42. The State Government will continue to support the diligent work being done by the COVID–19 Action Committee headed by His Excellency, the Deputy Governor. Benue State is fully aligned with all the prevention and mitigation measures being put in place by the Federal Government and our development partners.
43. Mr. Speaker, Honourable Members, we are exploring every opportunity to ensure that this budget works for our people in spite of all the constraints. We are undertaking a debt sustainability analysis with the aim of restructuring some of our existing financial obligations and thereby reducing the monthly repayment burden on our revenues. Furthermore, our new Procurement Commission is working on a framework that will provide links to the Federal Government database for procurement and contract pricing in support of our Law to promote open and competitive procurement. In the same vein, we will commence strict compliance with the extant provisions of the Benue State Procurement Law, Debt Management Law and the Fiscal Responsibility Act And finally, it has become necessary to further tighten the belt on expenditure across all Ministries, Departments and Agencies of Government.
CONCLUSION
44. Mr Speaker, Honourable Members, permit me in concluding to once again call your attention and that of your colleagues to the powerful words of our State Anthem, which is relevant for all times but especially for challenging seasons such as these. While it would have been better if we did not have to contend with all these challenges, we are not dismayed or fearful about our prospects as a people and as a Government. God who knows all things brought us into office for such a time as this. We are therefore assured that, as we sing in our State Anthem, that God will surely give us victory over whichever giants stand in our way – if only we move unto the righteous side with Him. It is in the Spirit of this song that I enjoin us all as leaders and citizens to get even closer to God so that He will bless our endeavours and cause us to not only survive this season but also be ready to thrive beyond it. Moving on to the righteous requires us to commit to ending the debilitating local conflicts and quarrels that undermine the unity of purpose that we need to advance our collective vision for our State. It also behoves us to commit to the principles of prudence, integrity and conscientiousness as stewards of public resources.
45. Finally, Mr. Speaker, Honourable Members, let me express my appreciation and that of my Administration for the spirit of cooperation and constructive engagement that has existed between the three arms of Government and between the State Government and the Local Governments. The State Assembly has shown a resolve to be a constructive partner in our common quest to serve and protect our people. You displayed this spirit in the conscientious manner in which you diligently reviewed and passed the 2020 Budget and its revised version in record time. We are counting on you to bring the same spirit to the consideration and passage of the 2020 Supplementary budget and the 2021 Budget proposals which I now lay before you.
46. Thank you very much for your attention.
47. Long live Benue State.
48. Long live the Federal Republic of Nigeria.
49. In God we trust.
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