El-Rufai's $350 million loan request was rejected by the Senate today.
The Nigerian Senate on Thursday, March 29, 2018, rejected Governor Nasir El-Rufai’s $350 million loan request for Kaduna State.
The decision of the Senate was sequel to recommendations by its committee on local and foreign debts.
Chairman of the committee, Senator Shehu Sani in his presentation said loan would increase the debt burden of the state adding that Kaduna already ranks second on the list of states with high debts.
“That with the high total debt stock of Kaduna State at the moment, the new borrowing sought, will make the debt service to revenue ratio high, thereby worsening the state government’s ability to meet its other basic obligations to the people and further erode the economic viability of the State,” Senator Sani began.
“That approving the current loan request of USD350 million for Kaduna State will bring its total debt stock to USD582.1 million. That if this loan request is approved, the new total debt stock of USD582.1 million for Kaduna State will be unsustainable and necessarily attract huge financial burden on the meager federal allocation to the State.
“With the new borrowing, the Debt Service to Revenue Ratio of Kaduna State will further be increased and thus impact negatively on the ability of the State to meet Other basic needs of its people. The new debt stock will likely, further erode the economic viability of the state,”
“That with the high total debt stock of Kaduna State at the moment, the new borrowing sought, will make the debt service to revenue ratio high, thereby worsening the State Government’s ability to meet its other basic obligations to the people and further erode the economic viability of the State.
“The committee therefore moves that the Senate do reject Kaduna State Development Policy Operation (DPO) in the sum of USD350 million only as contained in the 2016 - 2018 External Borrowing (Rolling) Plan of Mr. President Commander-in-Chief of the Armed Forces,” the Kaduna lawmaker added.
‘El-Rufai’s loan request is misplaced priority’
Similarly, another Kaduna lawmaker, Senator Suleiman Hunkuyi described Governor’s El-Rufai’s loan request as misplaced priority.
“Mr President, one is amazed, perplexed and in shock to find that what the governor has gone ahead to indicate to the general public is completely different from what we found on the application of the facilities as indicated in the detailed drawdown table.
“As a representative of my people, I’ll like to say that the application of that loan is a misplaced priority. I strongly stand behind the prayers of the chairman of the committee that this very important chamber do reject that request for the loan,” Hukunyi declared.
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‘El-Rufai doing nothing in Kaduna state’
Senator La’ah Danjuma (Kaduna South) accused the Kaduna government of spending state funds on frivolities.
“The loan is not important as far as I am concerned. As a messenger of my people, they did not give me the authority for any loan to be approved. I met with the representatives of Kaduna state and asked what the loan was all about? What projects is this loan meant for? I should know from zone one, two and three who are the contractors responsible for the project? Where will the projects be sighted? But these questions were not answered.
“I realized that the money received in Kaduna state is much and there is nothing happening in Kaduna state lately. They are busy retiring and sacking people and you are asking for a loan. To do what with the loan? I don’t understand. If you are collecting a loan without giving a reason, I am not in support of such loan, my people are also not in support of it. Please, this loan should not be granted,” Danjuma begged his colleagues.
In his remarks, deputy Senate leader, Bala Na’Allah urged his colleagues to grant the wish of the committee and the Kaduna lawmakers.
“Three Senators have so far spoken on this matter and coincidentally, they are from Kaduna state. It appears that the three senators are in agreement that the recommendations of the committee should be upheld by this Senate,” Na’Allah said.
The bill was rejected after it was put to a voice vote by Deputy Senate President, Ike Ekweremadu who presided over plenary.
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