NewsPDM Faults Ganduje over N24B Loan

PDM Faults Ganduje over N24B Loan


PDM Faults Ganduje over N24B Loan
Gubernatorial candidate of Peoples Democratic Movement (PDM) in the 2015 elections, Engineer Bashir Ishaq Bashir has faulted the decision of the state government under to borrow the sum of N24bn from the Central
Bank of Nigeria (CBN) and some Commercial banks describing the idea as uneconomical.
Governor Umar Ganduje is planning to borrow N24bn for the state to finance
recurrent expenditure and also offset the five months accumulated
salary and pension arrears.
Engineer Bashir, who stated this while speaking to press men said it is unwise to for Kano to secure the loan when the state is battling to offset N300bn outstanding debt.
“This kind of loan is only taken to run critical developmental ventures that can generate revenue to pay the loan and also sustain the venture. But you don’t borrow money especially from commercial banks to finance recurrent expenditure or pay salaries and pension arrears” he said.
According to him, about 80 per cent of the uncompleted
capital projects in the state which government intends to finance with the loan were captured in the 2014 budget.
“I learnt that N10bn out of the N24bn loan will be spent on salaries and pension arrears, and another N10bn to complete Challawa and Tiga power plants. The two projects were ill-conceived because 35 megawatts at N14bn is the most expensive power projects in the world; it means
we are going to spend 1.75 million US dollars per megawatt”.
“Already, he said the dams were on ground and directing a river to power the project. Rather we are only installing turbines and possibly two sub-stations. And in the 2014 budget the actualexpenditure of N10bn have been paid by Kwankwaso’s government leaving behind only N4.22bn to be sorted out,” he asserted.
He also questioned the whereabouts of the N10bn that has beencaptured in the 2014 budget, asking “has it not been paid? Why the duplication, if it has been paid, has the contract been reviewed upward?”
The PDM guber candidate also argued that the two power plants cannot generate any revenue to the state, suggesting that instead of financing the two projects, government should rather build fertilizer plants to encourage farmers go into commercial farming so that they can create more job opportunities and stimulate the economy of the state.
He said: “From my little knowledge, you cannot get a loan from commercial banks in Nigeria with less than 25-27 per cent interest. Soif the state secures the loan with 25 per cent interest, then it is expected to pay N6bn interest annually.”


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