Foreign Loans: Senate Moves Against Reckless Spending By State Governors

The Senate on Thursday put machinery in motion for ensuring proper utilisation of loans obtained by State Governors from the World Bank.
This was made known after the closed door session between the Senate leadership and World Bank officials at the National Assembly in Abuja.
Briefing journalists after the closed door meeting, Senator Ahmad Lawan explained that the move by the Senate was in line with the need for fiscal discipline in public spending, especially on monies borrowed by the affected governments in the form of loans to facilitate development and prevent backwardness and burdensome debts in the states.
Lawan said: “The National Assembly participates in a limited way in granting states loans from international agencies, including the World Bank.
“Normally, the Federal Government guarantees certain loans to states and therefore the National Assembly scrutinises the programmes and projects that are lined for utilisation of those loans and this is our role.

“In ensuring proper utilisation of such loans by respective States Governments, we have met with World Bank officials.
“We have given our honest advice to them on how to bring about fiscal discipline by state governments on such loans, one of which is to ensure that states Houses of Assembly Committees like that of Appropriations, Public Accounts and the one on Finance are given some kind of support by the World Bank to ensure that they have the capacity to scrutinise and oversight the utilisation of such funds.

“Also, the Office of the Auditor General for every state should be enhanced and the capacity of such staff of the Offices of the Auditor General must be better so that they write very credible and deep reports of such utilisation of funds and of course those who will be implementing the projects, those who will be spending the money in the offices of the Commissioners of Finance, Budget and Planning and so on should also be supported and reformed.”

Lawan however said the debt profile of States that had collected such loans were not discussed at the meeting as to know whether any of them had surpassed its financial capability for such loans for now.