The Governor of the State of Osun, Adegboyega Oyetola on Monday signed into law the State’s 2020 revised budget of N82.2bn, following its passage by the State House of Assembly.
The budget was reduced from the initial N119.5billion to N82.2billion, representing a 32 per cent reduction.
Speaking during the official signing ceremony at the Governor’s Office, Abere, Osogbo, Oyetola said the current economic realities occasioned by the Coronavirus pandemic necessitated a downward review of the budget.
The governor also made clarification on the allocation of ‘N9billion to fight COVID-19′, stressed that a larger percentage of the allocation was to cater for post-Coronavirus era.
According to him, COVID-19 stands on two legs – health, being the present leg; and economy, being the future leg of the pandemic.
He further explained that the amount earmarked for COVID-19 was to provide a stimulus package that takes care of the health aspect of the pandemic, and the economic recovery aspect through the provision of support to Small and Medium Scale Enterprises.
He said: “We felt we have to be realistic particularly when it comes to budget because budget is not about moving figures around from the previous year or by adding additional percentage. As we all know, the level of our proactiveness will reflect on how we will sustain the economy because nobody saw this pandemic coming, but as a government we have put everything in place to ensure the economy does not suffer.
“Don’t forget that sometimes last year, we had an Economic and Investment Summit where we realised there was a need to diversify the economy from oil to agriculture, mining and tourism as if we knew the pandemic was around the corner.
“We made efforts to develop the agriculture and mining sectors which we have actually sanitised as we have been receiving a lot of investors coming in to partner with us. Again, we are lucky to be one of the states that participated in the production of first gold bar which was launched a few weeks ago by Mr President.
“But looking at the devastating effects of the pandemic, we thought what is desirable is to look at the size of the budget and ensure that we are realistic about its size.
“So, since the bulk of our revenue projection is actually from crude oil, then it makes sense for us to reduce the size of the budget and that is precisely what we have done as we have reduced the budget from N119.5billion to N82.2billion.
“For those who said we budgeted N9billion to fight COVID-19, that is not correct, it is a kind of stimulus package that will create more jobs for our youths. So, the budget analysis here is moved to support healthcare including the pandemic itself and to support the economy by giving support to MSME and the need to diversify the economy.
“We believe that with this size of our budget, we will be able to manage our economy and to do other required things, including infrastructure”, Oyetola stated.
Presenting the budget for signing, the Speaker, State of Osun House of Assembly, Hon. Timothy Owoeye, said that the unforeseen developments occasioned by COVID-19, caused a necessary revision and reduction of the initial budget by almost 32 percent.
Commenting on the management of the COVID-19, Owoeye commended the efforts of the State Government, adding that the welfare of the people was important, and that the legislative arm was ready to collaborate with the Executive to stimulate the economy and ensure the socio-economic growth and development of the state.
He also harped on the need to look into other sources of revenue for the State, adding that this was the only way to improve the state’s Internally Generated Revenue (IGR) of the state.
Earlier, the Commissioner for Budget and Economic Planning, Prof. Olalekan Yinusa, said the revision of the budget was caused by the alteration to the projections and assumptions that underlaid the initial budget, caused by the COVID-19 pandemic.
Yinusa listed some of the factors that necessitated the review of the 2020 Budget to include: fall in crude oil prices in the global market, steeping internally generated revenue and devaluation of the Naira.
Speaking on the methodology for arriving at the revised budget, Yinusa said that the revision involved an elaborate process, which involved the combined efforts of the Ministries of Finance, Budget and Economic Planning, Human Resources among others.
He added that the Nigerian Governors’ Forum (NGF) also supported States by contacting experts to support them in their revision.
Yinusa stated that priority was given to agriculture, commerce and industry and MSMEs, as part of measures to ensure that the economy is revived to a path of growth and stability.
