Wike, ALGON disagree over right to borrow from banks
APPARENTLY reacting to a directive that any local government chairman and agencies intending to obtain loans from banks should inform government, the Association of Local Government of Nigeria (ALGON) has declared that the consent Rivers State Governor Nyesom Wike was not needed to obtain loans from financial institutions.
The association also insisted that the Governor has no power to sack its members.
The state chapter of the Peoples Democratic Party (PDP) has also hinted that Governor Wike will soon sack all the 22 council chairmen and their councilors.
However, Rivers State ALGON chairman, Chimbiko Akarolo said in Port Harcourt yesterday that if “any local government area in the State needs loan and meets the conditions stipulated in law, it will go ahead as there is no law in Nigeria that explicitly say a governor’s consent is required for loans to be obtained or granted.”
Governor Wike had last week issued a directive that any local government area chairman and government agencies intending to obtain loan from any financial institution should formally write to him.
But Akarolo, chairman of Port Harcourt City Council reminded all concerned in the matter of existing rules on how local government can take their loan. According to him, “this procedure does not require any chairman to seek the consent of the State governor.”
“If you go through Rivers State Fiscal Responsibility Law 2010, Part 9, Section 39, it states clearly that agencies of government desirous of borrowing shall specify the purpose for which the borrowing is intended and present a cost benefit analysis detailing the economic and social benefits of the purpose which it intended to borrow…Even the Responsibility Act of this country also states that if you meet the conditions you don’t need the written consent of the governor of the state” he said.
Akarolo also faulted the decision of the House of Assembly to invite the Rivers State Independent Electoral Commission (RSIEC) commissioners to appear before it today (Monday) to explain the details of the just concluded council elections.
ALGON considered the invitation as part of conspiracy to dissolve the newly elected council chairmen and councilors.
He however, insisted that the governor and the House lack the power to sack duly elected council members as clearly stated in several occasions by the Supreme Court of Nigeria.
PDP spokesperson, Samuel Nwanosike, explained that the reason Governor Wike issued the directives to council chairmen to seek his consent before obtaining loan was to forestall frivolous loans that will further increase the State N17.2 billion loan profile.