Criminal Borrowings: Questions Lagos State Government under Fashola’s watch must answer

Criminal Borrowings: Questions Lagos State Government under Fashola’s watch must answer

On 28^th May 2015, we issued a public statement titled: “Out-going Governors & Democratic Governance Accountability In Nigeria: Time For Stock Taking”. The referenced publication of Intersociety became imperative on account of the age-long failure of various democratic tiers and arms of government in Nigeria to give detailed and satisfactory accounts of their governance particularly towards the end of their democratic tenures. This had made art of governance in Nigeria roguery, shapeless and directionless.

We also did say in the publication that consumption has overshadowed the legendary service to humanity concept of democratic governance in Nigeria. The referenced publication of ours further divided the governance accountability into credit and deficit democratic accountabilities; with the latter being governance rested on armchair, status quo and loan-based governance resulting in huge public debts channeled into unproductive sectors as well as huge civil workforce pay arrears and sorry state of public infrastructures and social services.

On the hand, credit governance accountability is governance rested on turnaround of public infrastructures and social services derived from creative and innovative governance. Its ingredients involve non-loan massive mobilisation of financial resources and human services, robust engagement of local and international private sectors for the purpose of industrialisation, wealth and job creation; robust relationship with international development and donor agencies. At the state level, a robust relationship is required between the affected state and the federal government with its strategic ministries, parastatals and departments.

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Other factors that bring about credit governance accountability are accountability in government and cutting costs of governance, workers’ welfare and job satisfaction, massive provision of public infrastructures like roads, bridges, sporting facilities, health and educational structures, and decentralisation of government infrastructures and social services. Thecredit governance accountability usually ends with quantum of verifiable achievements and intangible achievements like human development and public security and safety. Its cash reserves and liquid investments always surpass its outstanding public debts. It must be a capital oriented and not arecurrent oriented government. In all these, the only state to have achieved this rare foot in Nigeria in the past fifteen years of the country’s democratic governance is Anambra State as at March 2014.

Response of the Government of Lagos State:

It gladdens our heart to observe that the Government of Lagos State under outgoing Governor Babatunde Fashola has responded to our public call as contained in the referenced statement of 26^th April 2015. On 1^st May 2015; three days after the referenced statement of ours was released, the outgoing Government of Lagos State led by Mr. Babatunde Raji Fashola, SAN, organised a media briefing and presented its account of governance in the past eight years. According to the State’s Commissioner for Economic Planning & Budget, Mr. Ben Akabueze, the outgoing Government of Lagos State had in the past eight years (May 2007 – May 2015) generated a total of N2.433 trillion ($12B) and spent a total of N2.749 trillion ($13.7B) in its governance of the state.

Criminal Borrowings: Questions Lagos State Government under Fashola’s watch must answer

Of the N2.433 trillion generated, N1.4 trillion is said to have come from its internally generated revenues (IGRs) with the remaining N1.033 trillion generated from its statutory federal allocations, donor agencies and counterpart funds. Lagos State is the richest IGR State in Nigeria with average generation of N22 billion monthly. It is also the most indebted state in Nigeria owing officially N512 billion ($2.5B) and unofficially about N600 billion in local and international debts. Its unofficial debts of about N600 billion stems from the fact that its local debts profile has not been updated by the Debts Management Office (DMO) since January 2014; a period of a year and six months or 18 months.

Also, out of the N2.433 trillion generated and N2.749 trillion spent in the past eight years by the state under reference, only N1.132 trillion was spent on the execution of 8, 961 certified public projects/programs and of this, education and health got paltry 14.09%  and 7.66% respectively. This is far below the UNESCO’s 26% advisory benchmark for budgetary funding of public education and health in the developing countries. The breakdown further shows that of the N2.749 trillion spent, N1.617 trillion likely went into recurrent expenditures and other non capital expenditures. The referenced State Government also said that it attracted N15.13 billion and N27.24 billion respectively from donor agencies and counter-part funds in the past eight years.

Further analysis of the governance accountability as publicly presented by the outgoing Government of Lagos State clearly indicates that a total of N316 billion ($1.6 billion) was borrowed as loans in the past eight years by outgoing Governor Babatunde Raji Fashola, while the outstanding balance of over N200 billion was incurred by the former Bola Tinubu’s administration (1999-2007) as well as other previous administrations in the state. Our arriving at the foregoing submission stems from the fact that when the N2.433 trillion generated in eight years is deducted from N2.749 trillion spent in the same period, a deficit (loan) of N316 billion occurs. During the public presentation of the referenced governance accountability of the outgoing Government of Lagos State, no details of channelisation of the huge debts and their output or gains or losses were provided. There is also no public disclosure of any functional state industry or other huge profit and job yielding public investments where the loans were channeled into.

Why Lagos Huge Debts Are Criminal Borrowings:

Lagos State has one of the smallest landmasses in Nigeria measuring 4,211 square kilometres as against Anambra’s 4,611 square kilometers. The state is also the most urbanised state in Nigeria having experienced development as the country’s second pioneer capital as far back as 154 years ago (1861) till 1991. It is densely populated and is the most populated city in Africa with over fifteen million residents. Provision of public infrastructures and social services in the state is shared in three folds: State Government, Federal Government and local and international private sectors through corporate partnerships and funding. For instance, there are road projects executed singly or jointly by the likes of First Bank, Fidelity Bank and Zenith banks and handed over to the state or done in association with the Lagos State Government; likewise hospital and educational institutions built and maintained by missionaries and other private bodies.

The grand import of the foregoing is that Lagos State Government is supposed to be a maintenance government and not a construction government. The State also has no reason to be enmeshed in serial borrowings. This is more so when modern industrial policies of governments are private sector driven with governments playing regulatory and security guarantor roles for private sector to thrive. In the world over, private sector is the largest creator and employer of wealth and labour. Borrowing is bad but if it must be done; then it must be channeled into tangibly productive sector capable of repaying the loans borrowed within a stipulated time frame. It is democratically tabooed for a State Government to secure local or foreign loans for the purpose of payment of its workers’ wages or for the purpose of defraying or offsetting its overheads or allowances of its political office holders.

It is also wrong and condemnable for the outgoing Government of Lagos State to have borrowed for the purpose of resuscitating or upgrading public primary and post primary schools in the State. By the provisions of the Universal Basic Education (UBE), schooling in Nigeria, from the Primary School to the junior Secondary School (JSS3) is freely provided substantially, if not wholly by the Federal Government. The primary and secondary school education sub sector lacks the capacity to generate funds for the purpose of repaying the loans borrowed for its operations. Besides that, thousands of public and missionary primary and secondary schools in Anambra State under the immediate past administration were renovated, rebuilt, built and upgraded without borrowing a dime locally or internationally. Most of the funds used in this regard came from donor agencies and development partners through strategic partnership.   

The Missing Points:

Apart from loopholes inherent in the governance accountability presentation by the outgoing Government of Lagos State as they concern reasons, uses, gains and losses of the huge loans under reference, there are several missing points arising from the governance stewardship presentation.

1.Lagosians and Nigerians must be told by the outgoing Government of Lagos State the total cash and other liquid investments of the state in the past eight years. For instance, are there state’s investments in the Orient Petroleum PLC in Anambra State, etc, and how much, if any, is being left in the state coffers?

2. Lagosians and Nigerians must be told the total arrears owed to contractors, if any, for the state contracts certified done and completed.

3. Lagosians and Nigerians must be told how much arrears owed the state’s retired and serving workforces as they concern their retirement gratuities, salaries, pensions and other workers’ benefits.

4. Lagosians and Nigerians must be told the total amount of severance packages or pay designated for the outgoing elected and appointed public office holders in Lagos State including the outgoing Governor and his Deputy.

5. Lagosians and Nigerians must be told how much the outgoing Government of Lagos State spent every month as its wage bill. That is to say, how much did the state spend monthly in its workers’ salaries, pensions, allowances and overheads of its government machineries and personnel including the governor and his deputy’s security votes all in the past eight years? 6. How many kilometres of roads, bridges and railways were constructed and completed in the past eight years as well as their costs? How many were built and funded by corporate bodies? 7. What about hospitals, schools, housing, etc? 8. What is the worth of direct foreign investments attracted to the state, if any, in the past eight years?

Commendation:

The attempt made by the outgoing Government of Lagos State at presenting its account of stewardship is very commendable particularly in this era of institutionalisation of governance roguery in Nigeria. Presentation of governance accountability for public view and criticism is a fundamental hallmark of democratic establishment. It also gives a firm direction and a hope for the succeeding or incoming government and those that elected it. Outgoing Governor Babatunde Fashola is also called upon to critically address the missing points highlighted above as a matter of public importance and gubernatorial excellence. The referenced outgoing Governor himself also owes Lagosians and Nigerians a moral and constitutional duty of declaring his assets and cash worth publicly as he leaves office on 29^th May 2015. He should not only make them public, but also publish them side by side with his 2007 pre gubernatorial assets and cash worth declaration.

Condemnation:
The outgoing Government of Lagos State also deserves condemnation particularly for borrowing unjustifiably a whopping sum of N316 billion in the past eight years.  It remains our irrevocable position that the Government of Lagos State under Mr. Babatunde Raji Fashola, SAN, has no reason whatsoever to enmesh his state in serial borrowings to the extent of incurring N316 billion out of the state’s official total debts of N512 billion. If a state like Anambra State between March 2006 and March 2014 could refuse to borrow a dime; and yet it came out at the end transformed beyond imagination, with billions of cash left in its coffers; why should the Nigeria’scentre of excellent go borrowing? Lagos State ought to be the Nigeria’s biggest lending state and not the country’s current biggest borrowing state. The express import of the outgoing Fashola’s governance accountability presentation, which authenticity is yet to be dually verified,  is that it is a government with deficit accountability and governance; by generating in eight years N2.433 trillion and spending in eight years N2.749 trillion.

Why Other Outgoing Political Officers Must Go the Way of Anambra & Lagos States:

We still insist that other outgoing governors and elected political officers including outgoing President Goodluck Jonathan and the headships of State and Federal Legislative Houses should prepare and publicly present their accounts of leadership. At the level of the National Assembly, Nigerians must be put in the public knowledge of how many public interest and social service oriented bills were passed and assented to in the past eight or four years. Letting the Nigerian public into the quality or otherwise of the passed bills is also extremely important. What about the anomalies inherent in the Constitution including its ouster clauses and other bodies of law in Nigeria including the Criminal Code, the Penal Code, the Criminal Procedure Code, the Criminal Procedure Act, the Prisons Act, the Police Act, the Private Guard Act, the National Open University Act, to mention a few?  Who is responsible for the archaic nature of these laws and whose duty is it to upgrade them to the international best standards? Have they been upgraded?

How many sub regional, regional and international rights and humanitarian treaties ratified by Nigeria have been domestically codified by the National Assembly in accordance with Section 12 of the Constitution? Are there laws that needed to be passed following mounting challenges of modern technologies and harmful human environmental activities, which have not been created and passed by the National Assembly? Are the prosecutorial and penalty provisions in Nigeria’s anti graft and other criminal laws qualitative and stringent enough to secure speedy convictions and deterrent from repeat and fresh commissions?

•Being text of a statement entitled ‘Governance Accountability In Nigeria & Lagos State Government Response: The Missing Points’, issued today in Onitsha by the International Society for Civil Liberties & the Rule of Law (Intersociety). It was signed by the Board Chairman Emeka Umeagbalasi; Head, Campaign & Publicity Department, Uzochukwu Oguejiofor-Nwonu; Head, Democracy & Good Governance Programme, Chiugo Onwuatuegwu; and Head, Civil Liberties & Rule of Law Programme, Obianuju Igboeli, Esq. Photo shows Governor Fashola.

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