Anambra State government has reduced the size of its 2020 budget from N137.2 billion to N112.8 billion due to the adverse effect on the economy by the ravaging coronavirus pandemic.
Already, the state Commissioner for Economic Planning and Budget, Mr. Mark Okoye has held an intense interactive session with stakeholders on the matter during which he explained that it had become necessary for the federal and state governments to review their budgets to reflect the current economic realities.
The virtual budget review session hosted by the Commissioner had in attendance, officials of the state budget team, and representatives from the civil society organizations, including the Manufacturers Association of Nigeria (MAN), the State Traders Association, among others.
Okoye said: “The state budget for 2020, other things being equal, will be revised to N112.8 billion from the earlier approved budget of N137.1 billion. The reduction in the budget size is N24.3 billion representing an 18 percent decrease.”
Further break down shows that the recurrent expenditure would decline by 18.9 percent from the initial N58.8 billion to N47.7 billion, while total capital expenditure would reduce by 16.9 percent from N78.4 billion to N65.1 billion.
The Commissioner, however, said that the budgets of critical sectors like health, water and sanitation were left untouched to ensure that there was a buffer to contain COVID –19 outbreaks and associated social and economic fall-out.
He said further that the revised total revenue would represent a drop of 29 percent from the projected N158.6 billion to N112.8 billion, adding that factors that necessitated the review included fall in crude oil prices with effects on statutory and value-added tax, VAT, revenues, drop-in Internally Generated Revenue (IGR) and other capital receipts.
The commissioner drew special attention to key underlying guidelines driving the 2020 budget revision, explaining that non-essential items in the budget had either been reduced or stripped from the Ministries, Department and Agencies (MDAs) capital expenditure budget.
He added that the reduction in some non-essential approved budget lines was to position the state against post-COVID-19 shocks on the back of dwindling government revenues and receipts.
Okoye emphasized that provisions have also been made to provide cash transfers and livelihood support to poor and vulnerable households in the light of current economic realities, increase food security and safe functioning of food supply chains for all residents of the state, with special emphasis on poor and vulnerable households, as well as provide low-interest facilities to support micro and small businesses.
The leader of the civil society groups, Mr. Chris Azor commended the state government for organizing the forum, which he observed, was aimed at openness and inclusion, and expressed the belief that the state has what it takes to tackle the challenges and remain sustainable.