Benue State Governor Samuel Ortom has signed an approved revised budget of N108.8 billion for the 2020 fiscal year.
Briefing journalists in government House on Monday on the highlights of the approved revisions to the 2020 budget, background and rational, Gov Ortom explained that the budget was reviewed from the initial sum of N190.8 billion to N108.8 billion representing 43 percent reduction.
“Recall that the 2020 budget was reviewed and passed by the State House of Assembly and I duly signed it into law on 30 December 2019 for implementation with effect from 1 January 2020.
“However, by the end of the first quarter it became clear that we must revise the budget as a result of the global economic shocks created by the oil price war between Saudi Arabia and Russia and the disruptive impact of the COVID-19 pandemic.
“It is in response to these changing circumstances that we have been forced to revise the macroeconomic projections on which the approved budget was set,” Ortom said.
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He said the revised macroeconomic projections were anchored on projections of the oil price benchmark which was US$57 per barrel and now US$20 per barrel, oil production benchmark at 2.18 million barrels per day and now 1.7 million barrels per day.
He also observed that the exchange rate (NGN:USD) was N305 and now N360 while National GDP Growth Rate (%) was 2.93 and now 4.42, Inflation (%), 10.81 and now 14.13.
“Based on these projections, our state is facing a fall in both oil-related and non-oil revenues, which could be anything between a 57% to 67% drop over the course of the year.
“Income from traditional revenue sources such as earnings, tax, PMS under-recovery (now zero) and Value Added Tax (VAT) is expected to decline along with our own internally generated revenue (IGR).
He stated that these adjustments have made it necessary for the state to revise the approved 2020 budget.
“Noting the above assumptions and taking into consideration the impact of oil crash and COVID-19 on the global, national and sub-national economies, we are now proposing the total sum of N108,822,683,181.00 only for approval as revised estimated aggregate revenue from all sources in fiscal year 2020.
“This figure represents a reduction of (N80,660,827,844.00) or 43% from the approved year 2020 revenue estimates.”
He gave the highlights of the approved 2020 Budget and the
Revised 2020 Budget as follows; recurrent expenditure; from
N108,548,525,887.00 to N68,557,429,886.40, personnel cost from N50,637,250,646.00 to N37,286,131,793.26, Overhead, N63,911,275,240.00 to N31,271,298,093,5, Capital expenditure, N74,934,985,138.00 to
N40,265,253,295.46 bringing the total from N190,886,611,025.00 to
N108,822,683,181.00.43
