The Oyo State Chapter of the All Progressives Congress (APC) has knocked Governor Seyi Makinde-led administration and the state assembly over an alleged rising debt profile of the state.
This came as the state Assembly approved a N2billion loan for counterpart funding of donor-assisted projects and a N3.5 billion overdraft for salary, in two different plenaries on Thursday.
Reacting to the developments on Friday, the chairman, Oyo APC, Isaac Omodewu, in a statement, described the fresh loan as an act of wickedness and recklessness on the part of the Makinde government.
The party said it was baffled that the state government continued to borrow despite proclaiming improvement of the state’s IGR from N1.7bn to N3.3bn and that it executes many of the projects using the Alternative Project Funding Approach.
The party also worried that trend of events pointed to the fact that the state is also borrowing to pay salaries.
It consequently cautioned Makinde on the rising Oyo State debt profile, advising him to instead rejig his economic policies, repurpose the improved internally generated revenue and not mortgage the future of Oyo State.
The statement read: “We are still shocked as a political party to hear that Governor Seyi Makinde has obtained approval to take an additional N2bn loan from a domestic source at a concessional rate of 12 per cent per annum and a repayment period of 12 months as well as a N3.5bn overdraft to pay salaries despite claims of increased internally generated revenue and the deployment of public-private partnership arrangements in financing many of the projects being undertaken. This is particularly appalling as many of the projects financed by the numerous loans remain unfinished and inconclusive.
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It is thus saddening and shocking that the Oyo State’s economy has been pushed to the point where overdrafts are being taken to pay salaries while billions are wasted monthly on powering streetlights lights with diesel generators after the removal of cheaper and environmental-friendly solar-powered street lights.
“Apart from routine contracts inflation, borrowing is another Makinde’s way of siphoning funds for his already-failed second term bid.
“It’s regrettable that the PDP-dominated Oyo State house of Assembly is only active when they are financially induced to approve Governor Makinde’s loan requests. We hereby advise the lawmakers to stop acting as rubber stamps.
“They are expected to serve as checks and balances for the executive arm of the government, instead of routinely serving the governor’s selfish whims.
“Salary payments being a recurrent item on the state budget should never have been financed by loans, especially a domestic loan for that matter, considering that the most basic of economic practice and wisdom dictates that loans should be taken to finance capital projects.
“Such naive and fundamentally inept economic policy can only lead Oyo State into insolvency and economic depression if not immediately stopped.
“Oyo State is already ahead of Osun, Ondo and Ekiti States with her N141,193, 578,346.57 domestic debt burden, according to the domestic debt data for the 36 states of the federation and the Federal Capital Territory released by the Debt Management Office of the Federal Republic of Nigeria as at March 20, 2022.”
