Refrain from excessive and frivolous borrowing, group tells Gombe state governor Nigeria news
- Alhaji Muhammadu Inuwa Yahaya urged to stop mortgaging the fate of Gombe state on the altar of borrowing
- The call was launched by the Gombe Good Leadership Association (GGLA) in a press release made available to Legit.ng
- According to the group, debts should only be contracted by the state for the sole purpose of accelerating development at a reasonable cost.
Gombe State Governor Alhaji Muhammadu Inuwa Yahaya has been ordered to stop borrowing excessively to avoid mortgaging the state through accumulated debt.
The governor, who recently turned 60, was ordered to renounce this financial recklessness, in an appeal from a group called the Gombe Good Leadership Association (GGLA). The appeal was contained in a statement titled “A Call to Stop the Governor from Borrowing Gombe State from Mortgaging the State”, issued and signed by Association administrator Mohammed Salisu Abdullahi.
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According to Abdullahi, “We have followed the wave of borrowing from the government led by Muhammadu Inuwa Yahaya in Gombe State and have noticed that it has borrowed well over 44 billion naira in just over two years and yet embarks on obtaining another loan. of N35B from the capital market.
“Already the Executive Council of Gombe State on October 6, 2021 gave its approval for the loan and ordered the Commissioner of Finance and Economic Planning” to write to the Minister of Finance to issue an ISPO of N 665,605,647.90 per month to allow state deductions. FAAC allocation in settlement of principal and interest accrued on the Suku through a sinking fund to be created for the purpose and payment of financial advice, ”he noted.
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The group also highlighted the issue of “service charge of 0.005% of the sum of N 175,000,000.00 to Finmal Finance Services Ltd” (a company owned by Umaru Kwarianga, chairman of Gombe Investments and Property Development Company and director of campaign of Governor Muhammadu Inuwa Election as governor of Yahaya in 2019).
The group expressed concern about the surge in borrowing and added that the process was not caused by the urgent and realistic needs of the state. He added that debts should only be contracted by the state for the sole purpose of accelerating development at a reasonable cost.
According to the GGLA statement, “Of particular concern to us is that these excessive borrowing which comes with an overwhelming socio-economic burden and impact on the state are not being stimulated or pushed by the government. urgent and realistic needs of the state. This irresponsible borrowing enthusiasm, if left unchecked or curbed, will eventually cripple the state and subject its people to a long term of heinous and hellish economic slavery.
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“The paramount condition for the justification of a state government to borrow is the ability of the proposed project to be self-sufficient, capable of repaying the loan and, above all, is an integral and vital part of the state’s fiscal and development framework. . State debts should not be acquired at the whim and pleasure of state leaders, but for the sole purpose of accelerating development at a relatively reasonable cost, ”the group noted.
“We call on the Governor of the State of Gombe to, within seven days of this publication, publish in at least one national daily and one circulating within the State the details of all the debts he has contracted. the details of which should include the amounts, the purpose for these debts and their link to the government’s development program, a cost-benefit analysis showing the economic and social benefits of these borrowings, a cash flow projection to ensure the viability and sustainability of the purpose of the loan;
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“Audited financial statements for the last three consecutive years; appropriation laws authorizing the purposes for which the loans were used, the amount that was repaid or the repayment plan, the ratio of the profile of the state’s debt to its total revenue, the internal revenue of the ” State, State investments (if any, Evidence of obtaining and maintaining the current credit rating, Debt sustainability analyzes by the DMO, Evidence of an update submitted to the DMO of the data quarterly on domestic debt and Proof of compliance with all requirements of the Investment and Securities Law (ISA) 2007, ”the statement added.
The group has warned all banks, which have made loans to Gombe State, to be prepared to face legal action if they do not comply with all regulatory requirements regarding such involvement.
“By this publication we also put all banks that have made loans to the Gombe State government or are in the process of processing loans for the Gombe State government or are involved in government loans of Gombe State in any way, please note that we will put in place legal proceedings to ensure that they face the full wrath of the law for any failure to meet all regulatory requirements regarding such involvement. .
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The GGLA noted that “We are concerned that despite borrowing colossal sums and of course state revenues from FAAC and IGR, the state is getting poorer day by day, its infrastructure, public institutions and departments are deteriorating at an accelerating rate. rate.
“The growing profiles of the education and health sectors of the state under previous governments are fading, and no aspect of the state can be said to have been positively affected by this borrowing government. Indeed, the state is collapsing and the current borrowing frenzy is indicative of the ignorance of Governor Yahaya and his team. The government has awarded contracts on paper, but we boldly state that the reality on the ground does not reflect such contracts, ”the statement added.