Debt: Your allegations are fraudulent, Fayemi replies Fayose

 

Fayemi and Fayose

The immediate-past governor of Ekiti State, Dr. Kayode Fayemi, has dismissed claims of financial recklessness and indebtedness levelled against his administration by the Governor, Ekiti State, Ayodele Fayose.

Fayemi described Fayose’s allegations as “fraudulent claims and deliberate distortion of facts” to paint a dismal state of finance for the state.

Fayemi, in a statement signed by his Chief Press Secretary, Mr. Olayinka Oyebode, said Fayose should have gone through the handover note on his four-year stewardship before making unfounded claims.

Fayose had, in his inaugural speech on Friday, levelled allegations of huge indebtedness and financial recklessness against the Fayemi administration.

He said the Fayemi administration, which had 157 accounts in different banks, had committed Ekiti State to financial liability of N84bn.

Oyebode, in statement on Sunday, said contrary to Fayose’s claim that the account of the state was in the red, the state bank balances as at October 15, 2014, stood at N1, 930,739,725.84bn.

“This comprised N1, 463,805,908.56 (state account) and N466, 933,817.28 (local government account). Also the Bond Sinking Fund Account balance as at September stood at N3, 019,987,424.03,” he said.

Justifying why the Fayemi administration opted for bond, he said the Federal Allocation to the state had dropped by about N480m monthly since the beginning of the year, noting that this had placed a huge strain on government finances.

Oyebode said Fayemi had in 2011 approached the capital market where it raised N25bn bond spent on infrastructural projects.

According to Oyebode, about N14bn had been repaid through the laid down repayment regime while the Federal Government   still owes Ekiti State over N17bn.

He said if the Federal Government effected the payment, the debt profile of the state would have been greatly reduced.

He said, “It is our belief that Mr. Fayose was hasty in making a pronouncement on the state of the finances and other matters without first going through the handover note, which contains explicit details of government transactions and financial situation. Nothing can be more mischievous and irresponsible than this. The Debt Management Office still rates Ekiti State as one of the least indebted states in the country.

“For the avoidance of doubt, the indebtedness of Ekiti State as of October 15, 2014, is N36,316,017,758.93bn. Of this amount, N7,830,636,440.62bn represents foreign loans incurred by previous governments since the days of the old Ondo State.

“The remaining sum of N28, 485,381,316.31bn represents internal loan. These include inherited loans from previous government and outstanding balance (debt) of the bond taken at the capital market. In spite of this, the Federal Government owes the state N17, 710,728,299.06bn. This includes N10, 839,493,135.63bn (amount due for construction of federal roads); N4, 012,384,082.60bn (refund on Paris Club) and N2, 858,851,080.83bn (amount due on ecological projects).”

Oyebode also debunked Fayose’s claim that the former administration owed the workers in the state   two months’ salary.

He said the only salary being owed the state workers was that of September, 2014, adding that this was due to the reluctance of banks to give the state facilities following sundry allegations of collaboration levelled against the banks by Fayose.

He said, “The Fayemi administration has had to resort to bank facilities in order to augment the now insufficient allocation and pay workers salaries as well as meet other obligations. There is no responsible leader in Nigeria today that will not acknowledge the poor state of the country’s economy, a development that has made it difficult for the Federal Government to meet its obligations to the federating states. In the last two years, states on many occasions have had to leave the monthly FAAC meetings empty handed, like they did last week. This is in addition to a huge reduction in the amount given to the states.”