EDO STATE 2014 BUDGET TEXT OF 2014 BUDGET PROPOSAL PRESENTED TO THE EDO STATE HOUSE OF ASSEMBLY BY COMRADE ADAMS ALIYU OSHIOMHOLE, mni, CON, GOVERNOR EDO STATE , DECEMBER 11, 2013 Mr. Speaker Principal Officers of the House Honourable Members Members of the Edo State Executive Council Representatives of the Oba of Benin Other Royal Fathers Elder Statesmen and Party leaders Gentlemen of the Press Distinguished Ladies and Gentlemen 1. Introduction Mr. Speaker, I wish to sincerely thank you for giving me the opportunity to present the Edo State 2014 Budget Proposal to the Edo State House of Assembly. Allow me to reaffirm my deep appreciation to you and the other Distinguished Members of the House for the robust partnership and support extended to this administration since its inception. Our relationship with this honourable House has been characterized by cooperation and contestation on how best to carry out our developmental goal, and I do hope that this cooperation will endure in the years ahead. With your support, we have been able to sustain the tempo of development across the 18 Local Government Areas of the State. Our people are living witnesses to our developmental strides in the provision and delivery of physical and social infrastructure and services; and strengthening the institutions of governance across the State, which have positively affected their lives. In addition to the landmark achievements we have recorded in the area of road construction, education, health, flood and erosion control, rural electrification, and water supply among others, this administration, through your continuous cooperation has no doubt created and expanded economic opportunities and jobs for our young people, which have resulted in wealth creation and poverty reduction. As you are aware, our efforts have significantly led to arresting the palpable decay in environmental, social, educational and transportation sectors in the State. We are determined more than ever before to reposition Edo state and take it to the next level in fulfillment of our campaign promises. The 2014 budget is, therefore, designed as a launch pad to propel us to higher levels of developmental possibilities. It hopes to leverage on the investments we have so far made in governance, infrastructure and education to create an enabling environment for investments, unlock the human potentials and promote economic growth. 2.0 Review of 2013 Budget Permit me, Mr. Speaker, to recall that the House approved a total budget size of N154,125,498,265 billion for the 2013 financial year as amended. Of this amount, N66.242 billion was approved as Recurrent Expenditure, while the approved Capital Expenditure was N87.883 billion 2.1 Revenue Performance The approved Recurrent Revenue was N130.697 billion. Of this amount, N90.670 billion represented anticipated receipts from the Federation Account, N28.979 billion was approved as Internally Generated Revenue, while the Aids, Grants and Opening Balances accounted for N8.548 billion and N2.50 billion respectively. As at the end of September 2013, the Total Revenue stood at N84.076 billion. Out of this amount, N57.160 billion represented accruals from the Federation Account, and N14.486 billion was internally generated, while Aids/Grants and Capital Receipts accounted for N0.425 billion and N12.00 billion respectively. In 2013, revenue performance was affected by the reduction in the Personal Income Tax leading to a big drop in our Internally Generated Revenue to the tune of N500 million monthly. The drop in the allocation from the Federation Account arising from the alleged oil theft has also adversely affected the revenue profile of the State. These are challenges that we have had to contend with in 2013. 2.2 Expenditure Performance The Recurrent Expenditure component of the 2013 budget was N66.242 billion, broken down as follows: 1. Personnel Cost N 28.017 billion 2. Overhead Cost N 17.115 billion 3. Consolidated Revenue Fund Charges N 0.160 billion (Statutory office holders) 4. Pensions and Gratuities N 5.460 billion 5. Total Recurrent Debt N15.490 billion As at the end of September 2013, the total Recurrent Expenditure incurred stood at N 46.847 billion. The breakdown is as follows: 1. Personnel Cost N 18.913 billion 2. Overhead Cost N 9.554 billion 3. Consolidated Revenue Fund Charges N 0.075 billion (CRFC- Statutory office holders Salaries) 4. Pensions and Gratuities N 2.942 billion 5. Recurrent Debt Repayment N 15.363 billion I am delighted to report that we have remained faithful to our wage obligations despite the dwindling allocations and inflows from federal sources, which led to delay in payment of salaries by some more buoyant States and even the Federal Government. We have equally honoured our pensions and gratuity commitments. As at the end of September, 2013, we have disbursed N2.942 billion to pensioners and towards the liquidation of inherited gratuity liabilities. On the whole, we have sustained our policy of financial prudence and budget discipline which has kept the cost of governance within reasonable limits and ensured that more resources are channeled to capital expenditures and welfare enhancing projects. 2.3 Capital Expenditure The approved Capital Expenditure for the year 2013 was N87.883 billion. As at September, 2013, actual expenditure stood at N 24.652 billion. The substantial part of the capital disbursements have been spread over the priority sectors of the State economy as listed here under: 1. Construction/Rehabilitation of Roads (Intra-city and Inter-city Roads); 2. Flood and Erosion Control Infrastructure; 3. Primary and Secondary Education. 4. Health Care Infrastructure 5. Information and Communication Technology Infrastructure – ICT 6. Energy and Water 2.4 Roads Development In 2013, we have made substantial progress in roads construction across the State. We have completed eleven (11) important inter- city and intra-city roads, in line with our vision to deliver good quality, well drained and all year motorable standard roads across the State. In addition to these, fourteen (14) other road projects are on-going. We are, of course, not oblivious of the fact that there are still several communities that need to be linked to adjoining economies through motorable roads. I wish to assure you that we would not relent in our efforts towards fixing the outstanding roads and integrate other communities to the larger economy. 2.5 Rural Electrification We are convinced that electrification is a critical input in the development process. For our rural communities, electricity is vital for the burgeoning small- and medium- scale enterprises. In line with our policy to make rural areas attractive and minimize the incidence of rural-urban drift, the State Government extended electricity supply to ten (10) rural communities that were hitherto without electricity, while electricity supply to existing PHCN Network system in forty-seven (47) communities was reinforced across the 18 Local Government Areas. Similarly, a total number of 25 transformers and 25 feeder pillars were purchased in 2013 and put into use across the State. 2.6 Flood and Erosion Control As part of our programme of environmental protection and urban renewal, we have, in 2013 sustained our efforts at combating the menace of flood and erosion in Benin City and other parts of the State in a holistic manner. In this regard, the implementation of the Benin City Storm Water Project continued to occupy the front burner of the environmental development sector. It is also important to note that massive work was done at the popular Five Junction Intersections culminating in its successful commissioning during 2013. This project, as you are aware, is a success story in urban planning, and it stands as a living testimony of our resolve to make life better for the good people of Edo. Also, a part of the environmental protection measures carried out in 2013 is the de-silting of existing drains in major towns across the State. Our efforts are no doubt beginning to bear fruits: we have been able to substantially reduce the problem of perennial flooding and the resulting fatalities and destruction of property we usually witness year in and year out in Benin City and its environs. While we build on the gains we have made so far in flood and erosion control, I wish to reiterate my earlier appeal to the public to refrain from acts that block existing drainages and waterways through indiscriminate dumping of refuse and erection of illegal structures. The government shall continue to pull down such illegal structures. 2.7 Education From the onset, we have given a pride of place to Education because we are convinced that education is the foundation for any meaningful, long term and sustainable progress of any society. This has continued to inform our objective and actions in the educational sector, mainly the building of new schools and rehabilitation of existing ones. Accordingly, the massive renovation of schools which was embarked upon by this administration as part of the “Total School Transformation Agenda” has remained firmly on course. In this regard, more schools have been renovated while additional classrooms have been constructed. In the same vein, chairs and desks, as well as instructional materials were distributed to schools. It is also noteworthy that three (3) Model Secondary Schools to be furnished with state of the art equipment are being constructed in each of the three senatorial districts of the State. We have equally made substantial progress in our efforts to restore standards through the screening of teachers to ensure that only those qualified teach in our schools are so employed. All these have further strengthened public confidence in our public schools, which is evident in the continuous increase in fresh enrolment and re- enrolments in our public schools. 2.8 Health In the area of health care, our goal has remained the strengthening of secondary health care through the construction/renovation of existing structures and provision of hospital equipment and preventive services. In 2013, we have made good progress in the implementation of capital projects and programmes in the sector. We have also achieved qualitatively positive results from health intervention initiatives. This is quite evident in the area of maternal and child health. Maternal and child mortality have dropped significantly below the national average as attested to by the UNICEF and WHO. It is also noteworthy that just as we have witnessed in the Education sector, public confidence in our health institutions is steadily being restored. 2.9 Information & Communication Technology (ICT) In order to strengthen the governance process in the State, achieve value for money and ensure transparency and accountability in government’s financial transactions, the present administration had invested massively in ICT to facilitate our efforts in this direction. In 2013 we have undertaken an innovative expansion of our ICT infrastructure and taken it to a higher level. With the launching of Edo State Open Data Portal, Edo State became the first sub-national government in Africa to successfully develop and launch an Open Data Portal. The Portal is aimed at empowering citizens to collaboratively participate in public sector innovation, promoting entrepreneurship, and research, and open innovation partnerships that will translate into jobs and investments in promising start-ups. It is also the objective of the portal to increase trust in government through citizen’s engagement and improvement in their lives by leveraging on technology. 3.0 THE 2014 BUDGET ESTIMATES Mr. Speaker, the 2014 Budget is christened BUDGET OF RENEWED HOPE aimed at taking Edo State to the next level. Coming at the wake of the fifth anniversary of this administration, the 2014 budget is targeted at the completion of on-going projects and expansion of infrastructure. It is in essence aimed at opening up the State economy for rapid socio-economic development, while leveraging on the economic infrastructure we have put in place. This is in tandem with our broad strategy to stimulate productive activities, enhance sustainable livelihoods, improve human welfare and boost economic growth through investments in physical and social infrastructure. 3.1 Objectives of 2014 Budget In consonance with our strategic objectives and our commitment to sustain the tempo of development in Edo State, the major policy objectives of the 2014 Budget are as follows: 1. Completion of on-going infrastructural projects. 2. Provision of qualitative and affordable education and health- care delivery services. 3. Creation of investment friendly environment for a private sector driven economy. 4. Pursuit of human capital development. 5. Development of Agriculture for employment generation, self- sufficiency and self-reliance in food and raw material production. 6. Intensification of Internal revenue generation, collection and administration. The budget is also aimed at improving the delivery capacity of public institutions and personnel, as an overall strategy to enhance the quality of governance. This is consistent with our belief that government must continue to work optimally to deliver development to the greatest number of our people, at the most reasonable cost and in the shortest possible time. 3.2 Highlights of the 2014 Budget The proposed budget size for 2014 is N159.213 billion. The budget consist of N85.595 billion as Capital Expenditure representing 53.76% of the total budget, while the proposed Recurrent Expenditure is N73.617 billion which represents 46.24% of the total budget. 3.3 Recurrent Revenue The sum of N115.589 billion is proposed as Recurrent Revenue, which is made up of the following components. i. Statutory Receipts N65.331 billion ii. Internally Generated Revenue N25.095 billion iii. Aid and Grants N4.899 billion iv. Value Added Tax (VAT) N8.246 billion v. Share of Excess Crude N6.423 billion vi. Capital Receipts N5.595 billion 3.4 Recurrent Expenditure The estimated total Recurrent Expenditure for 2014 is N73.617 billion. It consists of the following: i. Personnel cost N31.20 billion ii. Overhead Cost N16.401 billion iii. Pension and Gratuity (CRFC) N5.001 billion iv. Statutory Office Holders Salaries N 0.250 billion v. Public Debt Charges N 20.565 billion 3.5 Capital Expenditure In line with the policy stance of this administration, the bulk of our Capital Expenditure is allocated to core priority areas. The sum of N85.595 billion is proposed for 2014 capital expenditure. The sectoral allocation is as follows: i. Administrative Sector N1.376 billion ii. Economic Sector N45.930 billion iii. Law and Justice Sector N0.648 billion iv. Social Sector N37.641 billion 3.6 Road Projects In 2014, Government will continue to accord priority attention to the construction of network of roads for sustainable socio-economic development of the State. Consequently, the sum of N24.00 billion has been proposed for all roads infrastructure across the State. The funds will be targeted at the completion of on-going road projects and the commencement of new roads already designed. In addition, twenty six new inter-city and intra-city roads across the 18 Local Government Areas have been earmarked to receive attention in 2014. 3.7 Flood and Erosion Control/Environmental Protection Government will continue to prosecute its ongoing effort at combating flood and erosion as well as to ensure a clean, safe and green environment in the three senatorial zones of the State. In this connection, the sum of N10.295 billion has been proposed in 2014 Budget for the Environmental Sector. 3.8 Education As a veritable instrument for sustainable development, this administration will continue to accord the Education sector its pride of place in the 2014 Budget. Consequently, the on-going renovation and expansion of infrastructure in primary, secondary and tertiary institutions will be intensified. Also, the development of technical education as part of the total transformation of the school system will be sustained. Accordingly, the sum of N15.00 billion has been proposed for the Education sector in the 2014 Capital Budget. 3.9 Health The sum of N8 billion has been allocated to the Health Sub-Sector in the 2014 capital budget proposal. Among the capital project earmarked for execution are as follows: 1. The completion of all on-going projects. 2. Completion of construction and equipping of the new Accident and Emergency/200-Bed Ward Complex at the Central Hospital, Sapele Road, Benin City. 3. Completion and furnishing of the 2nd and 3rd floors of the Block D of the New Secretariat Complex to provide permanent accommodation for the Ministry of Health. 4. Completion of 3 (three) warehouses and supply of equipment in the Central Medical Stores, Benin City. It is our desire to involve private partnership in the Health Care delivery system. In this regard, Government has received offers from well meaning organization which will be concretized in 2014 to ensure that our people have access to highly specialized facilities. Some of the areas of partnership being considered include: 1. Construction and installation of a Magnetic Resonance Imaging (MRI) Machine and the establishment of an Ultra Modern In- Vitro-Fertilization (IVF) Centre in the State. The MRI machine will aid in the diagnosis of serious head and spinal cord conditions amongst others; while the IVF is to assist women who are unable to achieve pregnancy to have babies of their own. 2. Establishment of purpose built Diabetes Mellitus support centres in three government owned hospitals to provide quality diabetic care to citizens of Edo State. 3.10 Rural Electrification In 2014, prime attention will be given to the completion of on-going projects while few new ones would be embarked upon. Similarly, the State Government has entered into partnership with Azura Power West African for the establishment of a Gas Power Plant at Ihovbor, near Benin City. On completion, the Plant is expected to inject 950 Mega Watts into the National Grid System. In order to boost power generation and increase available power for consumption in the State, the sum of N0.500 billion has been proposed in the 2014 Capital Budget for the Energy Sub-Sector. 3.11 Agriculture Consistent with government’s commitment to generate sustainable employment and boost domestic commercial agriculture, we are committed to pursuing innovative initiatives in order to refocus and reposition the sector. It is the desire of this administration to strengthen the agricultural sector and make agribusiness a viable proposition across all branches of agriculture. In 2014, attention will be given to finalizing efforts to cultivate over 300,000 hectares of new farmland across key food and cash crops spectrum, with an emphasis on the development of domestic small- and medium-scale agriculture, and creating over 300,000 new jobs over the next three (3) years of this Government. In addition, Edo State Agricultural Development Programme (ADP) and College of Agriculture, Iguoriakhi will be empowered to bring modern agricultural practices to our people. Accordingly, N1.5 billion has been proposed in the 2014 Capital Budget. 3.12 Water Resources and Water Supply The 2014 Budget will focus on the completion of on-going water schemes in the Local Government Areas. Also, during 2014, more boreholes will be sunk to provide water to our people with the use of the newly acquired Dando Drilling Rigs which have successfully struck water in difficult terrain such as Edo Central Senatorial District. Consequently, the sum of N1.5 billion has been proposed in the 2014 Capital Budget. 3.13 Housing and Urban Planning We are committed to providing affordable housing for our people. To this end, government intends to partner with real estate developers and financiers (within the PPP framework) to facilitate the delivery of mass housing across the 3 senatorial districts. We hope to create not less than 100,000 housing units through this initiative, over the next three years. Government has also established a Geographic Information System (GIS) to facilitate the accurate management of land in Edo State. In this regard, government would utilize the most recent technology to undertake aerial survey of the entire land mass of Edo State to enable the effective management of mineral resources, agriculture, road network, electricity, infrastructure, housing and other social amenities. 3.14 Civil Service Reforms In order to ensure that we restore our Civil Service to its previous world class standard, we have decided to embark on major reforms of the Civil Service to make it more efficient and effective. The Civil Service is being revamped to make sure that higher standards are enforced in the recruitment and promotion in the Civil Service. Steps are being taken to motivate our workforce. These include: regular promotions and sustained training. Edo state Government will effective January, 2014 commence the implementation of the contributory pension scheme so that we can have a fully funded pension scheme for our Civil Servants. We shall continue to ensure that existing pensioners receive their payments promptly. 3.15 Security Security has been a major challenge which had tended to put Edo State in the news for the wrong reasons and thereby discouraging some potential investors. We are determined not to address this crucial sector rest on our oars in ensuring that misguided elements and criminals do not thwart our developmental efforts. Accordingly, in 2014, we will step up efforts to ensure the security of lives and property in the State. We will continue to partner with and support the security agencies and forces in the State towards the appreciable reduction of all incidences of criminal activities in the State. To reinforce our complementary role, we have taken a decision to restructure and reposition the Neighbourhood Watch in order to make it more effective in detecting and combating crimes across the state. To demonstrate our seriousness in dealing with this menace, we were able to, with the support of this honourable House, enact a new law that prescribes the death penalty for kidnapping and related offences. Let me put on record, our sincere appreciation to the Security and law enforcement agencies operating in Edo State for their steadfastness and sacrifices in ensuring that our State is no longer safe for any one with criminal intent. 4.0 OUTLOOK FOR 2014 Mr. Speaker, the outlook for our dear State in 2014 is very promising, despite the drop in inflows from the Federation Account and Internally Generated Revenue we have witnessed in 2013. We have a sound development strategy and we have drawn important lessons in the process of implementation of our projects and programmes over the years. We also have in abundance the political will, and critical mass of support to drive our development agenda, sustain the gains we have so far made and break new grounds. The urge to deliver more must compel us to wear our thinking caps and reflect more, as to how to move the state forward by looking inwards, tapping into our creative resource and seizing the opportunities offered by the national and global market places. Therefore, we should all look forward to 2014 with exuberant enthusiasm and expectations. 2014 will definitely usher in greater advances, as we continue to build on the progress of today towards a better tomorrow. 5.0 CONCLUSION Mr. Speaker, Honourable Members, I have outlined the core policy goals and objectives of the 2014 budget, which are aimed at improving the socio-economic wellbeing of our people. The set targets and parameters used for the formulation of the budget are realistic, pragmatic and achievable. The 2014 budget is designed to ensure that we are on track towards sustaining our current development trajectory. It stands as a testimony to our resolve to use political power for nothing other than an instrument for the promotion of the welfare of the greatest number of our citizens. As a responsible administration, we will continue to run an open government with prudent management of scarce resources, while we shall focus on aggressive internal revenue generation drive to ensure smooth implementation of the budget. We will also remain focussed on the delivery of people-oriented projects and programmes. Let me at this juncture once again express my deep appreciation to this Honourable House for the cooperation and support extended to the executive arm that has led to the unprecedented level of development which we have collectively achieved since the inception of this administration. Together we will work to achieve our vision of building Edo State as an economic hub, with flourishing opportunities for our people. I also wish to place on record my profound gratitude to our Royal Fathers led by His Royal Majesty, the Oba of Benin, our religious leaders, Leaders of Thought, political leaders, labour leaders, the youth groups and leadership of civil society and professional organizations, across the State, for their wise counsel and inestimable support and guidance over the five years we have been in office. For the good people of our beloved State, I say a big thank you for keeping faith with our strong determination to sustain the task of taking Edo State to the next level. Mr. Speaker and Honourable Members, it is now my pleasure and privilege to present to you, the Edo State 2014 Appropriation Bill of N159.213 billion and details of the budget proposals for your kind consideration and approval. Thank you and God bless.
Posted on: Thu, 23 Jan 2014 22:55:19 +0000
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