Ambode Proposes N14.47 Trillion Special Fund To Bridge State’s Infrastructure Gap

Lagos State Governor, Ambode

The Governor of Lagos State, Nigeria,  Akinwunmi Ambode, has proposed the establishment of a special fund to address the state’s infrastructure deficit.

Further, he justified the state government’s decision to increase land use charge between 200 and 500 per cent, explaining that it was born of the need to drive capitalism in the state with a sense of social inclusion and generate more funds to bridge infrastructure gap.

Ambode spoke at an interactive session held with Organised Private Sector (OPS) and captains of industry in Lagos.

He said the meeting tagged “Lagos means business”,  “is more about the future of Nigeria than the future of Lagos.”

Array of dignitaries at the meeting include: President of Dangote Group, Alhaji Aliko Dangote; Founder of FCMB Plc, Otunba Subomi Balogun; Chairman of Heirs Holdings, Mr. Tony Elumelu; Founder of Premier Lotto Limited, Sir Kessington Adebutu; among others.

In his presentation, Ambode  revealed that the state would require a whopping sum of $50 billion (equivalent to N14.47 trillion) in the next five years to bridge infrastructure gap with the exclusion of education, health and housing sectors.

He said about $20 billion would be required for the construction of roads and $16.5 billion for providing 24-hour stable power supply under the Lagos State Power Reforms Law, 2018.

Further, he said the state would require $9.3billion for transportation; $5 billion for information & communication technology; $3 billion for water development and $2.7 billion for waste management and other environmental challenges over the period of five years.

Ambode proposed the establishment of infrastructure fund, saying “to address the state’s huge infrastructure deficit. There is need for infrastructure fund. This fund will be managed by private sector. It will be similar to the Lagos State Security Trust Fund.”

The governor defended the state’s decision to increase land use charge, explaining that his administration planned to do more than what it had been doing in the last three years with the budget of N1.046 trillion.

Under the 2018 budget, the governor said the state proposed to generate N720 billion internally, noting that the fund would either come from taxes or we turn to multilateral financial agencies to borrow.

He said: “If we must not tax, we must go to multilateral financial agencies. If we do not tax now, we will be forced to borrow from multilateral financial agencies. At the end of the day, we are still going to use tax payers’ monies to fund the actual loans and the interests.”

He provided insight into the Land Use Charge Law, noting that the law “was enacted in 2002. The law makes provision for review every five years. But it has not been reviewed for 15 years. I do not think we have done anything bad to review the law at this time because the value of property in all party is more than double.

He, however, said the state government “is ready to dialogue with the Organised Private Sector on the land use charge. We are a state of 24 million people. Only eight million are taxable. The number of people that actually submitted tax returns in 2017 is 2million. From this number, only 700, 000 people paid their taxes.”

Apparently, Ambode noted that the current tax returns were not enough to cater for the capital projects ongoing across the State, adding that major cities across the world with thriving economies are sustained by the taxes paid by residents.

Also at the meeting, Dangote said he was initially displeased with the decision of the state government to increase land use charge, noting that he had to confront the governor about it at a public function on Saturday.

He, however, said a business associate later explained details about the land use charge to him, which according to him, was not high in the real sense. He urged business community to help the Lagos State Government and voluntarily pay their taxes.