2025 Budget: Lagos targets revenue growth without borrowing
By Adeola Ogunrinde
The Lagos State Government may not need to borrow to finance its ₦3.367 trillion budget for the year 2025, according to the state’s Commissioner for Economic Planning and Budget, Mr. Ope George, and Commissioner for Finance, Abayomi Oluyomi.
The commissioners made this revelation during a press briefing on Friday at Alausa, Ikeja, where they analyzed the 2025 budget.
The officials emphasized that the state government has put in place strategic plans to generate more revenue to cover the budget deficit.
The ₦3.367 trillion 2025 budget will be funded from a total revenue estimate of ₦2.968 trillion, which includes Internally Generated Revenue (IGR) of ₦2.230 trillion, Capital Receipts of ₦111.839 billion, and Federal Transfers of ₦626.137 billion. The target revenue of ₦2.968 trillion represents a monthly revenue target of ₦247.331 billion.
George explained that the Lagos Internal Revenue Service (LIRS) is expected to contribute 63% (₦1.4 trillion) of the projected IGR, while other government Ministries, Departments, and Agencies (MDAs) will generate about 37% (₦830.177 billion).
He added that the state plans to achieve this target by expanding the tax base, deploying technology, and using economic intelligence, data gathering, and analysis.
“We believe there are significant revenue-generating opportunities in sectors like the informal economy, tourism, real estate, transportation, and trade,” George said.
The budget’s projected deficit of ₦398.662 billion will be funded through internal and external loans, bond issuances, and other sources. The deficit funding is broken down as follows: External Loan – ₦28.751 billion, Internal Loans – ₦203.831 billion, Bond Issuance – ₦150 billion, and Other Sources – ₦16.080 billion.
Expenditure Breakdown and Sectoral Allocations
A total expenditure of ₦3.367 trillion is budgeted for 2025, with ₦1.296 trillion allocated for recurrent expenditure and ₦2.071 trillion for capital expenditure, reflecting a capital-to-recurrent ratio of 62:38.
The recurrent expenditure includes:
Personnel Costs: ₦401.120 billion
Overhead Costs: ₦799.511 billion
Debt Charges: ₦95 billion
The personnel costs represent 12% of the total recurrent expenditure and have increased by ₦146.003 billion compared to 2024. This increase reflects the state’s commitment to salary increments to address inflation and the removal of fuel subsidies.
Meanwhile, capital expenditure accounts for 62% of the total budget, underscoring the administration’s focus on infrastructure development and the completion of ongoing projects.
Infrastructure Development Initiatives
Highlights of the infrastructure development projects include:
Construction of Samuel Ekundayo/Toga Road in Badagry
Construction of Abaranje Road in Alimosho
Construction of Adamo-Akanun-Agunfoye Lugbusi Roads in Ikorodu
Rehabilitation of roads in Ikeja GRA, including Oba Dosunmu Road, Sasegbon Street, and Sobo Arobiodu Street
Upgrading of the Lekki-Epe Expressway (Phase IIA)
Completion of the Abule Egba and Ajah Bus Terminals
Construction of Iyana-Ipaja and Opebi Link bridges
Other initiatives include urban renewal and technical studies for the 4th Mainland Bridge, construction of the Lagos-Badagry Expressway, and the second phase of the Lagos Rail Mass Transit System (LRMT) from Mile 2 to Okokomaiko.
The state will also develop a 68km Green Line rail from Marina to the Lekki Free Trade Zone, complete 13 new jetties, and provide new housing units in various locations, including Sangotedo Phase II, Ajara-Badagry, Ibeshe II, and Epe.
Commissioner George stressed that the “Budget of Sustainability” is not just a fiscal document but is structured to provide economic stability, environmental sustainability, and social equity to ensure that Lagos continues to thrive for future generations.
The 2025 budget focuses on five key pillars:
- Infrastructure and environmental sustainability
- Economic diversification
- Social inclusion and human capital development
- Governance and institutional reforms
