Two time governorship candidate of the Peoples’ Democratic Party (PDP), in Ogun State, Prince Gboyega Isiaka, has said that the $350 million loan request by the Ogun State Government from the World Bank would be additional financial burden on the State.
Isiaka wondered why the State wanted a jumbo loan considering the fact that it enjoyed several financial assistance from the government at the centre and also generating high income Internally Generated Revenue from earners.
He noted that the purpose for which the loan was meant for, is unclear to the people of the state.
He said, “Not only has the State taken two tranches of federal government bailouts, it also received two instalments from the Paris Club refund to the tune of tens of billions. Notably too, the state has always boasted of IGR in excess of N7billion monthly; So one wonders the need, yet again, for a new loan of this magnitude.
“It is doubtful if the current level of indebtedness of the state government which is put at about N300billion, can still accommodate additional loan burden if the provisions of the Debt Management Act and the Fiscal Responsibility Act are taken into cognizance.
“The truth of the matter is that the quality of social services, human capital development and relevant public utilities are abysmally low in Ogun state even with the high level of loans already sourced and high IGR receipt in the state. The lifetime of this administration is less than 19 months and it should rather busy itself with how to offset those humongous loans rather than take new ones.”
He urged the state House of Assembly to wake up to its responsibility by ensuring that loans approved are for the development of the people and that the existing debt burden is not allowed to continually increase.
While also praised the courage of the National Assembly Committee for the steps taken so far and urged the Committee to decide on the propriety of the loan based on sound prudence and debt sustainability considerations.
The financial expert however advised the state government to take a cue from the Federal government and a few states like Jigawa, which publishes its audited accounts and debt position periodically for citizens and other stakeholders to be informed.
“Financial openness and full disclosure by leaders should be treated as prerequisite of any progressive government and this is one of the values of our Organization, The Believe Movement”.
“At this juncture, the government should furnish citizens with its audited accounts for the last six years including the debt portfolio. A situation whereby the State debt profile is left to conjectures and rumours shows lack of transparency and indicates bad governance.”
“The time has come for the State House of Assembly to pass a resolution to ban the executive from further running after local and foreign financial institutions for loans that are spent on projects that are not people oriented,” he added.
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