THE 2012 BUDGET SPEECH, DELIVERED BY HIS EXCELLENCY, CHIEF T. A. ORJI (OCHENDO), THE GOVERNOR OF ABIA STATE, AT THE ABIA STATE HOUSE OF ASSEMBLY, ON THE 15TH DAY OF DECEMBER, 2011
Parade HE

PROTOCOL:

DISTINGUISHED LADIES AND GENTLEMEN!

We shall remain grateful to God for bringing us together for year 2012 proposed Budget presentation. I appreciate your continued support and contribution to the success of this administration.

This Budget proposal is anchored on our desire to consolidate on the major achievements of our administration in previous years and to ensure that our

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success in transforming our State into an investors’ destination; a place of innovative governance and a land where opportunities will be achieved, is sustained.

Mr. Speaker and Honorable members, external environmental factors have direct and indirect effects on our economy. The year 2011 witnessed global economic and financial crises in Europe (e.g. Greece and Italy), North African Countries and the United States of America. The full impact of these on our economy have not completely unfolded.

The Boko-Haram insurgency has caused socio-economic upheavals and insecurity in some Northern States of our Country. The prevailing security challenges in those States have caused some of our people to come back home with the resultant pressure on the existing infrastructural facilities and job

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vacancies. These developments remind us of the need to be proactive and prudent in the management of our resources.

Mr. Speaker, Honourable members, the 2012 Budget proposal before you is carefully packaged to achieve a strong, diversified and competitive State economy that should provide hope for the hopeless, jobs for the unemployed and peace for sustainable development.

Against this backdrop of the economic environment and the challenges we face as a State, the 2012 budget proposal is envisioned to be a Budget of Transformation.

It is our resolve to transform Abia State into a prosperous State that would guarantee equal opportunities and high standard of living for our people.

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Review of the 2011 Budget:

The general performance of this administration in 2011 is commendable.

Our strive to increase the Internally Generated Revenue (IGR), yielded significant improvement.  It was observed that the recurrent revenue as at the third quarter of 2011 was N36,640,588,599.88 (thirty six billion, six hundred and forty million, five hundred and eighty eight thousand, five hundred and ninety nine Naira, eighty eight kobo) only, representing 60 percent performance.

The total Capital Expenditure which represents government investments in infrastructure is remarkable.  A good number of roads have been rehabilitated and many more are on-going.

There are other on-going projects such as the rehabilitation of water schemes, construction of new secretariat for Civil Servants in the State, construction

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of the International Conference Centre, and the construction of a new Government House, among others.

The monitoring and evaluation report for the third quarter indicated that the 2011 budget has been implemented above 60 percent. The modest accomplishments recorded have been due to a combination of foresight and prudence in resource management within this period.

Revenue Performance as at 3rd Quarter 2011:

As at the 3rd Quarter of 2011, a total sum of N5, 608,355,069.95 (Five Billion Six Hundred and Eight million, Three Hundred and Fifty-five Thousand and Sixty-nine naira Ninety-five kobo only was realized from our internal sources.  This represents over 50 percent increase against that of last year.

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The revenue from the external sources was N31,032, 233, 589 (Thirty-one billion, thirty two million, two hundred and thirty-three thousand, five hundred and eighty nine Naira) only.

The breakdown is as follows:

Statutory allocation from
Federation Account                                  -N22,735,564,528

Value Added Tax (VAT)                            -N 5,035,327,904

Derivation                                                     -N 3,261,341,157

= N31, 032,233,589

We shall put in place measures to ensure enhanced revenue generation in 2012.

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Expenditure Performance:

The recurrent and capital expenditures as at the 3rd quarter of 2011 was N30,001,605, 998.45 (Thirty billion, one million, six hundred and five thousand, nine hundred and ninety eight naira, forty five kobo)only.

Considerable increase is expected in the level of expenditure within the 4th quarter, due to a lot of rehabilitation and construction work going on in the State within this period. Furthermore, the implementation of the new minimum wage on the recurrent expenditure will also lead to a significant increase.

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The 2012 Budget:

The Philosophy and Thrust:

In 2012 fiscal year, we shall reinvigorate governance with renewed enthusiasm in the areas of internally generated revenue, especially in the execution of projects which have revenue yielding potentials.  Integrated effort to be put in place towards the industrialization of the State and sustenance of the various economic empowerment programmes to reduce the level of poverty and unemployment, especially among the youths.

Our Framework shall include but not limited to:

  1. i. Sustenance of peace and security in the State.
  2. ii. Provision of enabling environment for investment.

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  1. iii. Concerted efforts towards the transformation of the entire road networks in the State.
  2. iv. Establishment of a new partnership with the private sector to create economic and educational opportunities.
  3. v. Develop our human capital and empower our youth.
  4. vi. Introduce modern technology in our Agricultural Sector.
  5. vii. Enhance value reorientation in our public sector.
  6. viii. Revitalise ailing government health institutions and improve health care delivery in the State.

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The 2012 Budget proposal is aimed at ensuring that the progress we have recorded, the sacrifices we have made and our commitment would transform the State to a modern, prosperous and secured place for all of us.

Naming of the Budget:-

Mr. Speaker, Honourable members, I present to this distinguished House of Assembly the 2012 Budget Christened “Budget of Transformation”.  The 2012 Budget is painstakingly articulated to stimulate economic growth and development of the State.

The necessary policy guidelines to remove impediments and ensure efficient implementation of the budget would be put in place.   Further details of this budget will be made public by the Honourable Commissioner for Finance.

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The 2012 Budget Outlay:-

The total budget outlay for 2012 fiscal year is N122,390,433,920 (One hundred and twenty-two billion, three hundred and ninety million, four-hundred and thirty-three thousand, nine hundred and twenty naira) only.                                                                                                         This represent an increase of 16.4 percent over that of the preceding year which was N105,106,188,110 (One hundred and five billion, one hundred and six million, one hundred and eighty eight thousand, one hundred and ten naira) only.

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The Breakdown of the 2012 budget is as follows:

A.     Revenue:

The revenue accruing to the State in 2012 is expected to increase. This is partly due to the anticipated favourable review of the revenue sharing formula of the Federal Government and partly due to the expected improvement in the collection of IGR and measures introduced by the reforms in the finances of the State.

(i)      Internal Sources:

In 2012, concerted efforts would be made to improve on our Internally Generated Revenue. Meanwhile some consultants have been engaged to enable us restructure the systems of revenue collection.

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It is our belief that the efforts we have made here, would assist us boost the level of our Internally Generated Revenue.  Our revenue projection for this year from Internal Sources is N22, 202,318,470 (Twenty-two billion, two hundred and two million, three hundred and eighteen thousand, four hundred and seventy naira) only.

(ii)     External Sources:

With the relatively high oil price in the international market and the peace in the Niger Delta Area, we expect considerable increase in revenue from the Federation Account.   Moreover, with the anticipated upward review of the States’ Share of the Revenue Sharing formula, more revenue from Federation Account will accrue to the State.

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Our projection is that N58, 900,000,000 Naira only (Fifty-  eight billion, nine hundred million naira) only will accrue to the State from statutory allocation of the Federation Account.                                                                                                                       It is expected also that N9, 000,000,000 (Nine billion naira) only will be received from Derivation Fund, N10, 000, 000, 000 (Ten billion naira) only from Value Added Tax (VAT) and other sources in 2012.

B.     Expenditure:-

(i)      Recurrent Expenditure:

The 2012 Budget Proposal for Recurrent Expenditure is N56, 997,215,700 (Fifty-Sixty billion, Nine hundred and ninety seven million, two hundred and fifteen thousand, seven hundred Naira) only as against N45, 654,833,770

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(Forty-five billion, six hundred and fifty four million, eight hundred and thirty-three thousand, seven hundred and seventy naira) only for the previous year, which indicates an increase of 24.8 percent.

The details of the total recurrent expenditures reveal that the Personnel Costs amount to N22, 896,150,040 (Twenty – two billion, eight hundred and ninety six million, one hundred and fifty thousand and forty Naira) only, while the Overhead Cost is N25, 887,939,140 (Twenty-five billion, eight hundred and eighty seven million, nine hundred and thirty nine thousand, one hundred and forty naira) only.

Also the sum of N8, 213, 126, 520(eight billion, two hundred and thirteen million, one hundred and twenty-six thousand, five hundred and twenty naira) only is for Consolidated Revenue Fund Charges.

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(ii) Capital Expenditure:

The summary of the Capital Expenditure is as follows:

Economic Sector                     -        N34, 206, 595,410

Social Sector                             -        N5,132,200,000 Regional Development                 -       N 6,124, 000,000

General Administration -        N18, 613,128,800

Economic Sector:

The new Economic Agenda initiated would be sustained and strengthened in 2012.  For instance, a few weeks ago, a new economic empowerment programme was launched in the State by the Federal Government.  The programme christened ‘YOU WIN’ is aimed at encouraging Skills acquisition, entrepreneurship and economic empowerment of the youth.

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This programme, when fully realized, will no doubt reduce the level of unemployment.  It is noteworthy to mention here that the year 2012, will witness inflow of both Local and Foreign Investment in the State.

Already, arrangement has been concluded for the construction of a Cement factory in Arochukwu Local Government Area.  Some of the ailing or moribund industries would also be revitalized to provide job opportunities for our people.

Agriculture:

Government recognizes the need to revolutionalize agriculture to attain its past glory in the State.   This is underscored by the global challenge of hunger and malnutrition threatening millions of people.

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We have proposed projects in 2012 budget that will employ improved farm input, farming systems, and post harvest processing technologies to increase food production, create jobs and ensure food security.  Our targets will include, but not restricted to:

-              increase hectarages of cultivated land by 30 percent

-              reduce waste and add value to farm produce through post harvest processing

-              provide adequate drugs and biologics in veterinary clinics to ensure animal health and quality meat production and

-              attract private investors to the agricultural sector in the State.

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The Ministry of Agriculture will be assisted to intensify tractorisation scheme in the three agricultural zones of the State.   The Ministry in collaboration with Local Government Areas and ASOPADEC will be encouraged to establish crop and livestock farms in the 17 LGAs.

The projects and programmes articulated for this 2012 budget will revolutionize the Agricultural sector and reduce hunger and poverty.

Infrastructure:

This administration would embark on aggressive construction and maintenance of State roads and bridges in Aba, Umuahia and all other parts of Abia State.

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We shall ensure effective and efficient management of the Transport Sector.  The Ministry of Transport through Public Private Partnership will intensify efforts in creating enabling environment for effective implementation of the State Transport Policy.

The State Fire Service will be made more functional through procurement of more fire engines and equipment. The Umuahia Water Scheme is being rehabilitated and will be functional by 2012. Other water schemes will be rehabilitated and new ones established in urban and semi urban areas.

A heliport would be established in the State come 2012. This will aid rapid response and deployment of security forces to sustain security in the State.

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Commerce and Industry:

In accordance with the State Vision 20:2020 and in recognition of the important role of the industrial sector as a catalyst for economic development, we shall intensify effort to encourage both local and foreign direct investments in the State.

We shall adopt policies that would promote the growth of indigenous entrepreneurs.  The State through the Ministry of Commerce and Industry will encourage establishment of cottage Industries, Small and Medium Enterprises.

The State will, fully participate in the “You Win” programme of the Federal Government.

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Efforts would be intensified to provide infrastructural facilities that are critical to industrial growth and development.  Our Moribund industries such as the Aba Textile Mill Plc and Golden Guinea Plc would be rehabilitated to start full scale Production.

The 2012 budget proposal is also, articulated to enable us build a strong and stable industrial sector that will encourage employment, reduce poverty and enhance growth. The government will strengthen its drive in promoting commerce which is one of the active sectors that sustains economic lives of Abia People.

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Social Sector:-

Health:

This administration shall continue to revitalize the hospitals and health institutions to enable them deliver adequate health care to the people of the State.

The primary health care system will be sustained by equipping the health centers in different parts of the State. The General Hospital at Amachara and the Specialist Hospitals and Diagnostic Centres would be equipped with qualified manpower to enable them function efficiently.

This administration shall continue to collaborate with international donor agencies, private investors in health care and local government authorities in its bid to reduce morbidity and mortality rates that are attributed to communicable diseases in the State.

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Education:

The present government is mindful of the importance of education in ensuring acquisition of relevant skills and competencies for development of the individual and the Society.                                                                                                                Therefore in order to achieve functional education in the State, this administration would embark on policies and programmes to accomplish the following:

(i) Free and compulsory Universal Basic Education for all pupils in the State,

(ii) Provision of conducive teaching and learning environment through the construction, renovation and rehabilitation of classroom blocks in State primary and secondary schools,

(iii) Private sector participation in education at all levels, and

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(iv) entrepreneurship skills acquisition.

This government would continue to train and retrain teachers to improve their efficiency.  We shall continue to co-operate with Agencies such as the Education Trust Fund (ETF) to enable the State benefit from their programmes.

Information and Culture:-

The importance of proper information management strategy in achieving a peaceful and stable society cannot be over emphasized.  In order to publicize and educate the people of the programmes and activities of the government, the information structure of the government will be repositioned.

To this end, in 2012 fiscal year, government will support and strengthen public enlightenment activities with modern digital equipments.

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The government will revitalize and equip Abia State Printing Press with modern equipments to enable it become more functional. The Broadcasting Corporation of Abia (BCA) and Abia Newspapers and Publishing Corporation would be provided with modern equipment to operate efficiently.

In 2012, the government will also collaborate with foreign partners to harness and reposition the tourism industry.

Regional Development:-

In 2012, this administration would intensify efforts in environment protection and ensuring the sustainability of proper waste management system and City beautification in urban and semi-urban areas.

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The government shall equally endeavor to provide a secured and quality environment, adequate for good health and well-being of our people. The Abia State Environmental Protection Agency, in 2012, will put into efficient use the newly acquired refuse collection trucks to ensure a clean and healthy environment.

We shall make policies that would secure the ecosystem and ecological processes and preserve biodiversity. Our ecological challenges,especially that of soil erosion is a big threat to our environment.

May I also inform this Honourable House and all Abians, that we are one of the six States, benefitting from the World Bank Ecological Fund. Government therefore, will endeavor to reclaim and rehabilitate 20 percent of our gully sites by the end of 2012.

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The people of the State will be adequately sensitized on the preventing and controlling of soil erosion and ecological threats.

General Administration:

Government shall continue to embrace reforms and programmes, that will enhance service delivery and well- being of our people, by providing more socio-economic welfare programs for the citizenry in 2012.

In fulfillment of my promise to our people, government shall build more houses for low and medium level income earners.

Furthermore, may I inform this Honourable House that this administration will commence the construction of a befitting Government House.

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I also, need to mention here, that some of the policies initiated recently by government were not aimed at victimizing anybody but were adopted to reposition the State for greater achievements and Socio-economic benefits for Abians. I therefore crave the understanding and support of our people.

Conclusion:-

Mr. Speaker, Honourable members of the House of Assembly, the challenges facing us in the coming year require all of us to assiduously work together for the economic and development transformation of our State.

The way forward has been carefully articulated here, and I present before you the 2012 Appropriation Bill for your consideration and quick approval.

I thank you, and indeed all Abians, for your continuous cooperation and understanding.

God bless Abia State!