LAGOS â€” Lagos State government yesterday said the dwindling federal allocation to the state was having adverse effect on the state accruable revenue, saying; â€œToday, Lagos State is struggling to ensure that the effect is minimal.â€
The government lamented that the review of the countryâ€™s revenue sharing formula last year by the Federal Government led to the state losing N800 million in November and December.
The disclosure came at a special plenary session chaired by the Deputy Speaker, Mr. Kolawole Taiwo, at the Lagos State House of Assembly, Alausa, attended by Commissioner for Finance, Mr. Ayo Gbeleyi, Economic Planning and Budgeting; Mr. Ben Akabueze, Special Adviser to the Governor on Taxation and Revenue, Mr. Abimbola Shodipo and the Accountant-General and Permanent Secretary, Office of Treasury, Mr. David Sunmoni.
The Assembly had on Monday after Governor Babatunde Fashola spoke on the dwindling federal allocation, invited officials of state government to explain further the effect of the decreasing federal allocation on the state.
While speaking on the adverse effect of the allocation on Lagos State, Shodipo said: â€œBut how long can we be able to keep this. There is need for this act from the central government to be nipped in the bud immediately.
â€œThe worrisome issue is that if the fund doesnâ€™t come in as at when due, they will not have appreciable effect on the state budget and economy. It affects every aspect of the state. It will affect the residentâ€™s purchasing power and their ability to employ people.
â€œIn the month of November, last year, the Federal Government reviewed the formula quietly. And this has a negative effect on Lagos State. If the state has projected from the beginning of the year what it would earn and spend. But midway, it will change the rule, the Federal Government is putting the states into jeopardy over the effectiveness of the state in achieving its set goal at the beginning of the year.â€