TARABA: Debt Profile On The Rise
EVEN before the fall in price of oil in the international market and the subsequent reduction in monthly allocation, the financial situation of Taraba State has been nothing to write home about. The state was already going cap in hand to source for fund. A situation The Guardian gathered, has not only crippled government activities, but has, as well, continued to paralyse small scale business in the state.
Though, accusing fingers have been pointed at the recently sacked acting governor, Alhaji Garba Umar, whom the recently reinstated deputy governor (Now Acting Governor), Alhaji Sani Abubakar Danladi, said left a debt of about N20 billion behind for the current administration. The Guardian, however, observed that the debt profile of the state since the Supreme Court reinstated Danladi, has continued to rise.
Apart from public servant salaries that the state government is presently managing to pay several days after the end of the month, no meaningful project is going on in the state.
As at the time of filing this report, plans by the state government to get additional N30 billion bond have been reached by the state executive council. The bond, if eventually approved, according to the Commissioner of Finance, Emmanuel Gowon, would go a long way to save the state from its present “financial crisis and devastated economy.”
Both the acting governor and commissioner believe that only a bond of N30 billion or its equivalent bank facility can bring succor to the state.
The commissioner, who noted that the present administration inherited about N20 billion debts from the sacked administration of Umar, said, “the situation is so bad that the state has to struggle before paying workers’ salaries.”
A breakdown of the debt, according to him, includes, N9.5 billion overdraft, N5.6 billion term loan and another N2.7 billion unpaid cheques to various ministries and contractors, as well as other liabilities and claims that sum up to about N20 billion.
He said to ensure that salaries are paid, the Danaladi-led administration had to negotiate with banks to convert the N7.5 billion debt of overdrafts into a term loan for a duration of 20 months.
This means, out of Taraba’s monthly statutory allocation of between N3.5 to N3.6 billion, the state pays close to N1 billion for the term loan. The state is then left with N2 billion to pay for the revolving loan, which it takes back to pay staff salaries of about N1.8 billion. The state is then left with nothing than to make other internal arrangements of borrowing to service the state’s developmental activities.
Gowon said, as if this is not enough, “there is a shortfall this February because the state collected only N3 billion, which makes us to start this month with a deficit of about N421 million. We have to renegotiate again to enable us pay salaries.”
He said it would take long for Taraba, whose monthly Internally Generated Revenue (IGR), is only about N140 million, to come out of the its present situation unless it secures a bond of at least N30 billion.
He said if the state is able access the facility, the first tranche of N20 billion could be used to offset the term loan and have a balance. And the remaining loan would be paid in a period of seven years with N390 million monthly, without stifling the running of government and yet embarking on some capital projects.
He said the State Executive Council (SEC) has agreed on that and communicated the House of Assembly to seek their approval.
The commissioner equally sought Taraba people’s understanding, maintaining that it was not their fault, but a mess inherited from the sacked government, which he said would have crumbled the state to a level of not paying salaries for more than three months if they had not negotiated.
For February staff salaries, he said the state government has concluded negotiations with the bank, which is processing the application, to enable it pay, in spite of the short fall in federal allocation.
What is, however, giving the people of the state, especially civil servants, sleepless nights is the way and manner the acting governor has continued to live a flamboyant life, despite his claim to have met empty treasury.
Apart from the huge financial resources he has continue to commit on his campaign for the senate position of Northern Taraba, his love for oversea trips is so pronounce as he is often out of the state.
Some civil servants, who bared their minds on the ugly situation, felt sad that the acting governor has failed to tread the path of the elected governor of the state, Danbaba D. Suntai, whom they said, “didn’t joke with workers salaries.”
Though, there are no plans to embark on any industrial action, there are indications that the leadership of the NLC and TUC in the state are set to call the acting governor to order.
Speaking on the condition of anonymity, one of the labour leaders, said, “the acting governor has approached us, and has told us the financial situation of the state and we have resolved to be patient with him.
“What is, however, disturbing us”, as stated by one of the labour leaders “ is his financial recklessness. He claimed the state is financially down, but we are worried with the amount of funds he is wasting on his campaign.
“I am quite sure that you too had observed that the man hardly stays in this state. So, tell me, who is fooling who? I don’t need to tell you our next plan, but you journalists would soon hear from us. That is it and I don’t want to be quoted now.
“At the appropriate time, we shall talk to the media. That is, only if he refused to cut down on his flamboyant lifestyle. Each time you approach them (Government), they will be telling you that the sacked acting governor had stolen all the funds meant for the state, whereas, they (present state government) are worse than the sacked one.”
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