By; Niyi Ogungbola, Abeokuta.
The Ogun State Governor, Senator Ibikunle Amosun has forwarded a letter to the state House of Assembly, to seek for the legislatures’ approval to participate in the federal government’s Budget Support Facility to the tune of N14. 16 billion.
The federal government’s loan facility, which came under the new bailout fund, has a repayment plan for a tenure of ten years with single digit interest rate.
Presenting the letter to House, the Speaker, Rt. Honourable Suraju Adekunbi Ishola disclosed this to the lawmakers during the plenary session Thursday in Abeokuta, the state capital.
According to the Speaker, Gov Amosun was requesting the state Assembly to approve the issuance of a Note for an amount not exceeding N15. 5 billion, further stated that the federal government had created a framework for budget support facility to the states of the Federation.
Governor Amosun in the letter, dated 14th June, 2016, told the state lawmakers that the loan, when obtained, would enable the state to navigate the present economic challenges and meet up with her obligations in payment of staff, pensioners and other stakeholders.
The letter reads in part: “I have extensively considered the suitability of the programme to Ogun, the Federal Allocation to the state has adversely reduced due to the global fall in Oil price.
“The tenor of the facility is 10 years with single digit interest rate which will confer significant savings in the cost of funds to Ogun Government”.
“Authorize the EXCO to do all such other things as may be required to ensure the successful execution and completion of the Note Issue.
“Authorize monthly deductions from monthly statutory allocations accruing to the State from the Federation Account as may be required to service the loan.
“Authorize the Commissioner for Finance and the Accountant General of the State acting reasonably and lawfully to do all such acts and take all such steps including, without limitation, obtaining regulatory approvals (if any), issuing an Irrevocable Standing Payment Order/Irrevocable Letter of Authority authorizing the Accountant General of the Federation to deduct from the State’s monthly Allocation accruing from the Federation Account as may be required to service the loan”, the letter concluded.
Meanwhile, the National Council of Muslim Youths Organisations (NACOMYO) has demanded that the federal government should investigate the ways and manners through which benefiting states utilised the first bailout funds extended to them.
National President of the organisation, Alhaji Kamal-ddin Akintunde who spoke with journalists in Abeokuta same day, said it is pertinent for the federal government to probe whether the initial bailout disbursement to states were utilised for the purpose for which they were intended or not.
Akintunde further explained that there is every tendency that state governors in Nigeria may abuse the opportunity provided by the federal government in the bailout fund and diverted the money for another use.
He said if the federal government fails to investigate the utilisation of the fund, states likely to benefit from the second round of the bailout fund are likely to see such as “business as usual” and re-direct the money for another purpose.
Akintunde, who queried how long states would continue to depend on federal government for bailing them out of financial mess, however, charged that all the seeming poor states in Nigeria must invent more means of growing the Internally Generated Revenue (IGR) of their respected states without having to wait for further assistance from the federal treasury.
He maintained that federal government’s probing into how the previous bailout fund was spent would further go a long way towards serving as a deterrent to states that had failed to utilise the fund for the purpose for which the money was meant for.
NACOMYO President also demanded that federal government should set up a committee that would monitor how benefiting states will be utilising the second bailout fund before the money is released to them, emphasising that defaulting states in the first bailout fund must not be allowed to benefit from the second round of the fund.
Amosun seeks Assembly’s approval for N14.16bn FG loan …as NACOMYO seeks probe of previous bail out found
By; Niyi Ogungbola, Abeokuta.