The Chairman Senate Committee on Finance, Senator Solomon Adeola, has put the federal government’s external loan request before the National Assembly at $22.6 billion and not the $29.96 billion in public domain.
Adeola also said the external loan is tied to the completion of critical projects like the Second Niger Bridge, the East-West Road, Lagos-Ibadan Expressway, Mambila Power project and the Kaduna-Abuja Highway.
He added that the Senate would investigate losses in the name of under-recoveries allegedly being incurred by the Nigerian National Petroleum Corporation (NNPC) in the importation of fuel.
Adeola, told reporters yesterday in Abuja that the external loan request came to about $22.6 billion because the eighth National Assembly had earlier approved part of the $29.96 billion loan request amounting to about $6 billion.
He said the approval of the loan would help the President Muhammadu Buhari-led administration to complete critical infrastructural projects.
He said: “The federal government is not asking the National Assembly to approve the sum of $29.96 billion loan for it. “This is because in the last Senate, about $6 billion had been approved for President Muhammadu Buhari to borrow out of the $29.96 billion.
“It is the balance of that figure that the government is asking us to approve for it in the borrowing plan, which is about $22.6 billion.
“The Senate Committee on Finance will organise a public hearing on the issue if need be.”
He said in the alternative, the Senate would engage the various agencies of the government to give them a clearer view of how the money would be utilised, adding that all the money being requested for borrowing would be attached to the execution of specific projects.
“We are not going to approve any loan plan that is not attached to project execution because that is the only way we can monitor the development and the proper utilisation of the money,” he said, adding: “The Buhari administration has five legacy projects, which it planned to spend the money on. They include the Second Niger Bridge, the East-West Road, the Lagos-Ibadan expressway, the Mambila Power project and the Kaduna-Abuja Highway.”
According to him, the approval of the loan would let the government achieve the completion of the projects before the end of its tenure.
It will also assist the government to fulfill its promise to Nigerians, he said, adding that the plan will cover the next four years.
“So, the loan would be taken in tranches. For instance, what the government desire to borrow in 2020, would be requested in 2020.
“That is why it is called a plan. The Senate will monitor its utilisation as soon as they are coming in,” he added.
He urged Nigerians to be more concerned about the judicious application of the loan than the amount of the loans or the attendant debt service burden.
He said: “Every successive government borrows and since the business of government is a continuum, any incoming government would have to inherit what the past administrations had borrowed.
“It is a commitment they made on behalf of the Federal Republic of Nigeria.
“What should concern us more is the judicious application of the money government is borrowing because all governments, even in the US, borrow.
“It becomes a burden when government takes loans and refused to repay. So, setting aside the money in order to service any outstanding borrowing is not a bad idea,” he stated.
On loan repayment plan of the present administration, Adeola said the government was considering setting up a sinking fund account as well as setting funds aside to repay the loans as and when due.
He said: “Borrowing will not bring untold hardship on people because any government coming on board after Buhari would still borrow.
“For instance, just last week, the Central Bank of Nigeria said that Nigeria is into a deficit of N4.62 trillion in 2019 alone.
“What that simply means is that the deficit recorded in the 2019 budget is N4.62 trillion. So, the question is, how do we augment this deficit?
“The options available are either we print new currency, borrow or raise international bond.
“So, the government needs to move on. I agree that there are challenges in the economy but it is not as a result of the action taken by the Buhari administration alone.
“Successive administrations before his own also contributed. Borrowing should not be an issue but ensuing that money borrowed must be used for the purpose for which it was meant serve.
“That is why the legislature must ensure that the government would make judicious use of the money for the purpose for which it was borrowed.
“This is the only thing that would allay the fears of Nigerians because there is no way we could avoid borrowing because the revenue coming in is in trickles not en bloc,” Adeola stated.
He explained that the Senate will investigate the alleged huge under-recoveries from fuel imports by the NNPC to ensure transparency and also called for a comprehensive overhaul of the corporation.
