The governor of Oyo State, Seyi Makinde, and the state house of assembly came under fire from the All Progressives Congress (APC) on Friday for the state’s soaring debt levels.
This came after the Assembly’s Thursday session in Ibadan approved a N2 billion loan for the counterpart funding of donor-assisted projects, including a N3.5 billion overdraft for salaries.
In a statement on Friday, the state’s APC chairman, Isaac Omodewu, responded to the news and called the Makinde administration’s decision to take out the loan “reckless and evil.”
The party, however, advised the government to restructure its economic policies, and repurpose the state’s improved Internally Generated Revenue (IGR).
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 percent 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.
“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 street lights with diesel generators after the removal of cheaper and environmentally-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 Peoples Democratic Party-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.”