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From Joe Effiong, Uyo
Despite being rated as one of the heaviest debtor states by the Debt Management Office, the Akwa Ibom State Government has come out to defend Mr Udom Emmanuel as a loan-frugal governor.
That state Commissioner for Finance, Dr Linus Nkan, fielding questions from reporters on the high debt profile of the state Monday, said that Governor Emmanuel was a prudent manager and financial expert.
Nkan admitted however that the governor most often shifts the burden of contractual loans to contractors handling projects in the state.
‘What he does is that, for certain capital projects, we fashion out ways that some contractors who are given jobs or who are to be paid would be allowed to take money from the bank, while we repay them and that cycle out within that particular year,’ the commissioner stated.
The finance commissioner said the governor was committed to ensuring that any dealing with commercial banks to advance development programmes in the State are settled within the financial year.
‘Any commercial bank loan that this government ever contracted, not even one Naira will be left unsettled by the end of this administration. What we normally do is that like in 2021, all such loans that the government has taken for those contractors are cycled out, and we are even ready to take new one from the beginning of this year, which will cycle out again by December 2022.’
He said the debt profile as published by the Debt Management office appears ‘to a layman that the government is reckless in borrowing and all that. Let me clarify that it is not true.
‘The composite of that figure is made up of indebtedness and loan. Indebtedness is made up of contractual liabilities. Contractual liabilities are the amount government owe to contractors for various contracts that have been awarded.
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‘These are also embedded in this debt figure. Like in Akwa Ibom State, the massive infrastructural renaissance, starting from the last administration, accrues indebtedness. Because if you see the level of development in Akwa Ibom State, it won’t be out of place to think that not all the contractile amount were paid, some of these jobs are ongoing and some were awarded by the last administration. For instance, Eket -Ibeno Road, Eket-Etinan Road that was awarded to CCECC.
‘The job is ongoing and the last government did not finish paying the money because the job was ongoing. Even the present administration is still paying and they are at work. Part of their contract sum is part of the indebtedness and many others like that. So contractual liabilities take the lion’s share that amount,’ he explained.
The Akwa Ibom Finance Commissioner said the debt figure was influenced mostly by the massive transformation and infrastructural development undertaken by the government, adding that most of the contracts were not paid because they are not completed.
‘“In this country today, I don’t see any State is second to Akwa Ibom in terms of infrastructural development. If you compare Akwa Ibom of today to Akwa Ibom of ten years ago, it is not the same as Akwa Ibom. How does this happen? The transformation that has taken place in the State, part of it has not been paid for because some of them are ongoing. That is just the truth about it.
“The component of the loan aspect of the debt profile is not something that has to do with this administration. We also know that the government is continuing, with due respect to all the liabilities we took over, we are also servicing them. So that debt figure is not a loan. Contractual liability, gratuity and arrears of pensions are the bulk of what we have there. Not Loan,’ Nkan explained.
Nkan commended the governor for effective management of the resources to advance the development of all sectors of the state and expressed optimism that in 2022 he would do more.
‘The major constraint to the government fulfilment of its marked plan is insufficient funds. But we thank God that in Akwa Ibom State, we have a governor who is a financial expert. He sometimes breaks the rock to bring out resources to execute his project.
‘The governor is so good in financial management. With what we had, the governor had to ensure that we make the best use and utilisation of resources. I believe in 2022 it is going to be the same thing. The governor does everything to ensure that what we have, we optimise it.’
