SERAP urges World Bank to suspend loans to Nigerian states

THE Socio-Economic Rights and Accountability Project (SERAP) has asked the World Bank to suspend further loans and other funding to the 36 states in Nigeria.

The rights group also urged the Bank to conduct an investigation into the spending of over $8.5 billion in loans and other facilities by the governors of the states. 

The National Bureau of Statistics reported that the country’s total public debt increased by 75.27 per cent from N49.85 trillion in the first quarter of 2023 to N87.38 trillion at the end of the second quarter of 2023.

In monetary terms, this is an increase of N37.53 trillion in three months. The ICIR reported that when the figures are broken down, each Nigerian currently owes N396,376.19 in terms of debt per capita.

The SERAP’s deputy director, Kolawole Oluwadare, said that the World Bank and its partners could not continue to give loans and other funding to these states where there were credible allegations of mismanagement or diversion of public funds.

He said, “We are concerned that there is a significant risk of mismanagement or diversion of funds linked to the Bank’s investments in many of the country’s 36 states. It is neither appropriate nor responsible lending to give loans to these states only for the loans to be misspent.

“We would consider the option of pursuing legal action should the World Bank fail or fail to implement the recommendations contained in this letter, and we may join the country’s 36 states in any such suit.”

The ICIR reported how some states got the Federal Government allocations but accumulated more public debts while about 31 states survived on more allocation from the Federal Government than their internally generated revenues.

The rights organisation quoted Section 41 of the Fiscal Responsibility Act, which provides that the government at all tiers shall only borrow for capital expenditure and human development, but the World Bank currently has a portfolio of about $8.5 billion spread across the country.

SERAP listed some states with questionable implementation of funding as Abia, Akwa Ibom, Adamawa, Anambra, Bauchi, Bayelsa, Lagos, Benue, Imo, and Ekiti.






     

     

    Others are Borno, Cross River, Ebonyi, Delta, Jigawa, Kaduna, Kano, Katsina, Kebbi, Kwara and Kogi.

    The organisation provided the following explanations to support its claims.

    • In Abia State, the government reportedly spent N397,520,734.84 on ‘feeding and welfare’ and N223,389,889.84 on ‘refreshments and meals.
    • The Akwa Ibom State government has reportedly spent N92.54bn on allowances and social contributions, social benefits, travel and transport, utilities such as electricity chargers, internet access charges, and materials and supplies such as office stationery, drugs, laboratory and medical supplies, maintenance, training in the first two quarters alone.

    The government has also reportedly spent N10 million on hosting/mobilisation of political associations and interest groups and N841.83 million on entertainment at meetings.

    • The Adamawa state government has reportedly spent N40.90 billion on non-salary expenditure as of the end of quarter three, 2023, including furniture allowance, travel and training, domestic and foreign, office stationery and consumables, and refreshments and meals.
    • The Anambra state government also reportedly spent N15.17 billion on frivolous items as of the end of quarter two in 2023. 
    • Bauchi state government reportedly spent N70.25 billion on frivolous items, and Bayelsa state government spent N58.26 billion on travel, welfare packages, burial logistics, meeting expenses, ‘praise night/thanksgiving expenses’, and ‘marriage ceremony support’.
    • In Lagos state, N440,750,000 was reportedly awarded to the office of the chief of staff for procuring a brand new bullet-proof Lexus LX 600 for use in the pool of the office of chief of staff. Some N2 billion was also reportedly budgeted to buy rechargeable fans, rechargeable lights, and fridges in the office of the deputy governor.
    • The Benue state government reportedly spent N34.44 billion on ‘special day celebrations’ ‘welfare packages’, ‘security votes’, and materials and supplies such as office stationery and books.
    • According to reports, Borno, Cross Rivers, Delta, and Ebonyi states also respectively spent N32.63 billion, N43.71 billion, N152.15 billion, N30.91 billion, and N41.11 billion on frivolous items and the public funds may have been mismanaged or diverted.
    • Ekiti state reportedly spent N31.33 billion on local and international travel and transport, miscellaneous such welfare packages, refreshments, honorarium and sitting allowances. According to reports, both Enugu and Gombe states respectively spent N33.36 billion and N24.73 billion on frivolous items, and the public funds may have been mismanaged or diverted.
    • The Imo state government reportedly spent N58.21 billion on refreshments, meals, welfare packages, and other allowances. 
    • Jigawa state reportedly spent N49.64 billion on transport and travelling, materials, and supplies, including drugs, vaccines, medical supplies, and stationeries.
    • According to reports, Kaduna, Kano, Katsina, Kebbi, Kwara, and Kogi states also respectively spent N27.87 billion, N17.79 billion, N40.49 billion, N24.51 billion, N41.19 billion, and N58.02 billion on frivolous items and the public funds may have been mismanaged or diverted.

    The ICIR, under its Open Contracting Reporting Project, monitored the failed implementation of several projects across the 36 states. Funding has been provided for most of these projects, but they were not executed. 

    Kehinde Ogunyale tells stories by using data to hold power into account. You can send him a mail at [email protected] or Twitter: Prof_KennyJames

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