General News

Don’t plunge Kwara into debt trap, Babalola tells Gov AbdulRazaq

Emmanuel Kehinde, Ilorin

Access Bank
A chieftain of the All Progressives Congress (APC), Pastor Engineer Sunday Adebayo Babalola, has urged the Kwara State Governor, Mallam Abdulrahman Abdulrasaq, not to plunge the state into debt trap.
In an interview on Thursday, he stated that the reported plan by the Kwara State Government led by Abdulrasaq to access the Federal Government’s Bridging Finance Facility worth over N18 billion would increase the debt burden of the state and consequently, may plunge the state into a debt trap.
According to him, the state government incuring more loans would mortgage the future of Kwarans.
The Kwara PDP had in a recent statement said the loan will be at the interest rate of 9 per cent, adding that it is coming less than two months after the Government obtained a N35 billion loan, which it claimed would be spent on some projects. The party also had said that the State will also anytime soon, receive another N2.6 billion loan from the FG under its Livestock Transformation programme.
It added that if the Governor eventually obtained the proposed N18.74billion loan facility from the Federal Government, he would have succeeded in incurring over N50 billion loans within the space of 5 months.
Currently Kwara State receives an average of N3.8 billion monthly allocation from the Federation Account and N1.8billion average monthly allocation to the Local Government councils.
Also the Kwara Internal Revenue Service, KWIRS collects an average of N1.8 billion monthly.
Babalola, who is a chieftain of the All Progressives Congress warned the state government against accessing more loans for the state.
He stated that the governor had not shown justification for the already acquired loans or bond.
He alleged that the loan may be diverted for Abdulrasaq’s second term ambition.
Babalola said, “This is very sad situation. How can somebody collect for the government almost N50bn worth of loans within five or six months. The ..he collected what has he done with it? What are the programmes that he is planning to do with it? We can not see anything on ground with the one he already collected and he wants to collect another one.
“Remember, he has not upto two years left. So what will he achieve within one year that he has not achieved with close to three years that he has been governor. Majorly, he is going to be leaving for future generations such loans who will then been carrying such unnecessary burden.
“We have not seen anything on ground.Nothing is being contributed to the infrastructural, human capital development and welfare of the people. Nothing is being contributed to make the business environment better so that Kwara will con not continue to be what it is, which mainly a civil service state. Nothing is being contributed to generate revenue internally.”
He added, “I can see anything he has contributed and yet he is collecting loans in billions! With what will he use to pay the loans? Has even shown the people who are approving the loan for him, the methodology by which he is going to pay back? What is the internally generally revenue and allocation from the federal government that will enable him to pay back and still meet other obligations? So you see a number of questions that he needs to answer and what he is using the loans for, we do not know. He has not stated how he is going to back. It is very sad.”
“There is no developmental strides of his government. Everything requires planning. If you want to build a house, you will start by buying land, if you do not have one; studying the sand, taking a decision what kind of property you are going to build on it. You will then start commissioning an architect, structural engineers, mechanical engineers and other relevant professionals.It takes a whole lot of time to plan.
“Now he does not have time to plan that now. Is it going to within one year, plan, execute and construct whatever he is going to do. Basically, you can see that that loan is not meant for any meaningful purpose apart from taking them and using them primarily for his second term.”
Efforts to get the response of the Kwara State Government proved abortive as Abdulrasaq’s Chief Press Secretary, Rafiu Ajakaiye, did not pick his calls.
However, it was reported that construction works had resumed on the 34-kilometre Ilesha Baruba Gwarana road in Baruten local government as the administration had reportedly mobilised contractors back to site from the bond recently accessed for some infrastructural projects.
The Ilesha Baruba Gwarana road had been identified as one of the major projects to be funded with the N27bn bond the Kwara State Government accessed, according to a statement by the Office of the Senior Special Assistant to the Government on Project Monitoring and Evaluation.
It could be noted that a contract for surface-dressing of the Ilesha Baruba Gwanara road was first awarded in 2013 at N1,560,102,954.88. The contract underwent various upward reviews between 2013 and May 15, 2019 when the contract sums hit N2,782,716,900.95. As of May 29, 2019, only 40% of work had been done while 66.4% (N1,848,129,346.47) of the total contract sum had been paid with a balance of N934,587,554.48. Dissatisfied with the huge expenses made so far and the level of work done, the new administration in 2020 reviewed the contract to have the key road upgraded to asphalt with an addition of just N265,412,445.52, bringing the new contract sum to N3,048,129,346.47.
 Officials of the Ministry of Works had reported said the road construction should be completed by the end of the first quarter of 2022, barring any unforeseen delay.
The bond and the payments for some of the projects have been captured in the supplementary 2021 budget which was recently passed by the House and assented to by the Governor.
PDP while reacting to the recent plan to access the proposed N18.74billion loan facility in a statement by its State Publicity Secretary, Tunde Ashaolu, had decried that the alleged Governor Abdulrazaq’s penchant for borrowing was not sustainable and portends great danger for Kwara’s economy and development.
It had warned that it will plunge the State into an uncontrollable debt profile and hinder its capacity to meet future obligations.
The PDP, had warned that if the Governor eventually obtained the proposed N18.74billion loan facility from the Federal Government, he would have succeeded in incurring over N50billion loans within the space of 5 months.
The party had said that the state cannot keep this “trend of excessive and reckless borrowings.”
According to the party, every Kwaran should be agitated by the fast rising debt profile of the State.
The party had warned that Kwara State was not generating enough revenue that could take care of such accumulating debt burden.
It also asked the Governor to account for the revenues that have flowed into the state since he got to power, noting that Kwara had received in revenues over N280billion within a litte over two years of his administration.
PDP’s statement reads: “For the avoidance of doubt, within the last 30 months of the administration of Governor Abdulrahman Abdulrazaq, Kwara has received over N168billion in FAAC allocation, with an average of N3.8billion monthly allocation to the State government and N1.8billion average monthly allocation to the Local Government councils.
“Within the period under review, Kwara has so far received the sum of N11.6billion from the World Bank under its Fiscal State Transparency, Accountability and Sustainability Fund, FSTAS. Also, the State has so far got over N6billion in grants from the Ministry of Health, World Health Organisation, World Bank and UNICEF.
“Additionally, the State has, in the last 30 months, realised over N54billion in internally generated revenue, IGR, with Kwara Internal Revenue Service, KWIRS generating an average of N1.8billion monthly.
“Looking through the financial revenue profile of Kwara since May 29, 2019, you will note that the adminstration of Governor Abdulrahman Abdulrazaq had in less than 3 years realised over N280billion in revenues including federal allocations, IGR, grants and loans. This figure is higher than what any previous government in the State got within the period of its first 30 months.
“The Kwara PDP challenges Governor Abdulrazaq to explain to Kwarans what he has done with these huge cash inflows into the State coffers since he came on board. Our party is and we believed all concerned Kwarans should be worried that the growth in revenues of the state including monthly FAAC allocations and IGR, has not translated into prosperity, improved development for the State and better living condition for Kwarans.
“What has been the impact of the State’s huge monetary inflows under Abdulrazaq on the provision of infrastructural facilities, education, healthcare delivery, poverty alleviation, security, tourism, economy among others? How many key projects or programmes has the Governor executed or introduced since he assumed office?
“Finally, the Kwara PDP notes that If Governor Abdulrazaq’s appetite for frivolous borrowings is not tamed, it will get to a point that a huge chunk of the State’s revenue will be spent on debt servicing which could cripple the State’s economy. In the interest of the State, it is imperative for the Governor to exercise restraint in seeking additional loans that could plunge Kwara into insolvency and mortgage its future.”
Show More

Leave a Reply

Your email address will not be published.

Back to top button
Close
Close