Lagos State Introduces Wealth Fund to Drive Development and Secure Future Generations
Lagos State is preparing to launch a wealth fund designed to fuel infrastructure development, promote technological innovation, and create job opportunities for its expanding population. This initiative is outlined in a proposed bill titled: “A Bill for a Law to Establish the Lagos State Wealth Fund to Receive, Manage and Invest in a Diversified Portfolio of Medium- and Long-Term Assets for the Benefit of Lagos State and Future Generations of Its Indigenes and Residents, and for Connected Purposes.”
The bill was recently subjected to a public hearing organized by the Lagos State House of Assembly Committee on Finance at the Lateef Jakande Auditorium, located within the Assembly Complex in Alausa, Ikeja, on Wednesday. Attendees included various stakeholders who viewed the proposal as a bold step toward accelerating development in Lagos, which is often considered the fifth-largest economy in Africa.
During the hearing, Hon. Femi Saheed, Chairman of the House Committee on Finance, emphasized that the bill aims to institutionalize best practices in managing public funds while ensuring continued investment in the state’s future. He noted that the House of Assembly recognizes the importance of safeguarding today’s resources for the benefit of tomorrow’s citizens.
“The House of Assembly recognises the need to safeguard the resources of today for tomorrow’s citizens. We count on your expert submissions and constructive criticisms to refine this bill into a robust instrument,” he said.
Saheed further explained that the Wealth Fund would serve as both a stabilisation and investment fund, helping the state manage economic fluctuations and finance key infrastructure projects, especially in technology and innovation. He added that the initiative aligns with the Governor’s T.H.E.M.E.S. agenda, which focuses on driving investment in technology, innovation, and public infrastructure to ensure Lagos remains a model of sustainable development.
He also mentioned that the fund would be financed through the state’s Internally Generated Revenue (IGR), investment income, and an initial seed fund. All stakeholder submissions will be carefully reviewed before the bill is passed into law.
A Crucial Step for Economic Stability
Hon. Abayomi Oluyomi, Commissioner for Finance, highlighted the importance of the proposed Wealth Fund in safeguarding the state’s economic future. He recalled the fiscal disruptions caused by the Ebola outbreak and the COVID-19 pandemic, emphasizing the need for a stabilisation mechanism to protect Lagos during emergencies.
“This fund will ensure we save for the rainy day. With Lagos’ rapidly growing population, the demand for jobs and infrastructure keeps increasing. The fund is about savings and long-term investment to secure the future,” he said.
According to Oluyomi, Lagos is known as “the fastest-growing tech hub in the world,” often referred to as the state’s own Silicon Valley. He stated that the Wealth Fund will support continued investment in this sector.
“If well managed, the fund’s balance sheet could eventually surpass that of the state itself. It’s an Executive Bill that will become a lasting legacy for Lagosians,” he added.
Oluyomi also revealed that 0.5% of the current state budget (approximately ₦30–₦40 billion) would serve as the initial seed capital, while 3.2% of the state’s monthly IGR would be contributed to the fund.
Visionary Proposal for Generations to Come
In his keynote address, Rt. Hon. Mudashiru Obasa, Speaker of the Assembly, who was represented by Solomon Bonu, described the proposal as visionary. He emphasized that it would safeguard the state and secure the prosperity of generations yet unborn.
“It’s a statement of fiscal foresight and responsible governance. It establishes a structure and funds that will enable the state to save and invest for future purposes,” he said.
Obasa added that the initiative would transform revenue into long-term wealth and ensure that Lagos remains the heartbeat of Nigeria. He concluded by stating that leadership is not about what is consumed today but what is preserved for tomorrow.
Recommendations from Industry Experts
Dr. Yemi Sanni, representing the President of the Institute of Chartered Accountants of Nigeria (ICAN), commended the state for creating a body for wealth generation. However, he suggested that the fund should ensure compliance with national and international standards.
“We mandate the adoption of international public status accounting standards, and we recommend segment reporting. Also, 10-year audit tenure is too long; it should be reviewed to five years to align with global best practices,” he said.
Sanni also recommended joint audits for the first three years to ensure robust oversight and suggested the rotation of auditors. He emphasized that auditors must be firms registered with the Financial Reporting Council, not individuals.
He further recommended that one of the members of the board should be a fellow of ICAN with expertise in public finance, and that the audit committee chair must be a qualified accountant and preferably a member of ICAN.
Additional Suggestions and Concerns
Mr. Tokunbo Akande, Special Adviser to the CEO of Lagos Internal Revenue Service (LIRS), commended the assembly for organizing the stakeholders meeting. However, he pointed out that there is no provision for funding administrative and operational activities of the agency.
He also suggested that the fund should have an official website to publish its accounts. In response to these contributions, Hon. Adedamola Richard Kasunmu, Deputy Majority Leader of the House, acknowledged the importance of the proposed law.
“We are prepared for the economic contingency of the future with the proposed law,” he said.
