Facts have emerged as to the real reasons why the Senate refused to consider a request by President Muhammadu Buhari to approve the federal government’s 2016-2018 External Borrowing (Rolling) Plan of $29.960 billion (N9 trillion)at plenary session yesterday.
LEADERSHIP recalls that the president had, in a letter dated Thursday, October 20, 2016, requested the National Assembly to approve a $29.960 billion borrowing plan meant for special national infrastructure projects.
Buhari’s letter was read on the floor of the Senate on Wednesday, October 26, 2016, by the deputy Senate president, Ike Ekweremadu.
The external borrowing proposal was listed as number one item for deliberation for the day, yesterday. Accordingly, the Senate leader, Mohammed Ali Ndume, moved the motion for the consideration of the president’s request and the Senate president, Bukola Saraki, put the motion to question. However, a majority of Senators shouted “nay” via voice votes.
Apparently taken aback by the vote outcome, Saraki repeated the question and a majority of the senators emphatically voted against the motion to approve the loan request.
But few minutes later, LEADERSHIP learned why the senators were opposed to the borrowing request: two technical errors in Buhari’s correspondence actually forced the senators to take their stand.
Contrary to the claims in the first paragraph of the president’s letter to the Senate – that an attachment of the draft of the borrowing plan was available – the senators could not find any attachment of the draft of the borrowing plan.
Secondly, in the penultimate paragraph of the same letter, the president asked the Senate leadership to approve the disbursement of funds for North East projects pending the consideration and approval of the borrowing plan, a decision frowned at by the lawmakers, who wondered why the president wanted to jump the gun.
The letter read in part: “I wish to refer to the above subject and to submit the attached draft of federal government 2016-2018 External Borrowing (Rolling) Plan for consideration and early approval by the National Assembly to ensure prompt implementation of the projects.
“Given the emergency nature of these facilities and the need to consolidate the peace and return the region to normalcy and considering the time it will take to get National Assembly’s approvals, it has become inevitable to request the NASS leadership’s approval pending the consideration and approval of the 2016-2018 borrowing plan by the National Assembly to enable us disburse these funds immediately.”
Also, in a chat with journalists after the day’s plenary, the Senate leader corroborated LEADERSHIP’s findings, attributing the Senate’s decision to inherent “technical reasons” in the president’s letter.
He, however, gave the assurance that the request would be attended to after the amendment of the apparent errors.
“We don’t have such powers (of anticipatory approval). There is nothing to worry about. We cannot throw away the baby and the bath water. I’m going to appeal to my colleagues to see how we will bring the proposal back.
“I think there were some technical issues; it was supposed to go to the committee where it will be worked on, but unfortunately it didn’t happen. But we’ll look at it. But I can’t say when the re-presentation of the proposal will be.
“I had no idea the proposal would be rejected. If I had an idea, I would have marketed it,” Ndume told journalists.
Hours later, the Presidency also reacted to the development through the senior special assistant to the president on National Assembly Matters (Senate), Senator Ita Enang, who told journalists that the Senate would be provided with all supporting documents it needed to the consider the loan request by the executive.
He said the Presidency would engage with the Senate on the issue that had been raised.
“We are not disputing with the distinguished Senate. There are certain information and details which will enable them to consider in detail, and appropriately, the request of Mr President.
“So we are collating that information. The Budget Office of the Federation, the Debt Management Office, the Minister of Budget and National Planning, Minister of Finance and the economic team are collating the information so that it can be submitted to the Senate to enable them take the appropriate decision,” Enang said.
DMO Defends Loan Proposal
The director-general of the Debt Management Office (DMO), Dr Abraham Nwankwo yesterday offered more clarifications on the $29.9bn (N9 trillion) foreign loans’ request by President Buhari.
Nwankwo said the loan, which covers a period of three years, would help in addressing the nation’s infrastructure deficit.
“When you are in this kind of economic situation, you have to decide where you want to start addressing the problem. You then come to the conclusion that the most critical point to start is to deal with infrastructure problem. If you deal with infrastructure problem, the cost of power will be lower, the cost of transportation will be lower, and the cost of most other services will be lower,” the DMO DG said in an interview with Channels TV yesterday.
According to him, the major attraction to the borrowing framework is the low interest rate.
Nwankwo noted that the new arrangement was different from previous loans taken by past governments, like those from the Paris Club of creditors, which came with floating interest rates of about 18 per cent.
The Federal Ministry of Finance had, in a statement, explained that a large chunk of the loan would be taken at 1.5 per cent interest rate
Capital releases to MDAs hit 753bn
The federal government said it has spent a total of N753, 633,667,464 billion of the 2016 budget on capital projects between May this year when the budget was signed into law and October.
Details of the 2016 capital performance report for the federal Ministries, Department and Agencies (MDAs) which was obtained from the federal ministry of Finance yesterday showed that Power got the lion share of N209,246,760,165 billion, followed by defence which also got N69,512,363,730 billion for implementation of capital projects in the period under review.
The federal government had promised to spend N1.75.trillion on capital projects across the six geo-political zones of the country, while reading out details of the budget and its implementation plan earlier this year.
A detail review of the data from the ministry of finance showed that Transport and Agriculture got N30.54 billion and N29.578 correspondingly while, ministries of Water resources and Interior got N25.2 and N21.2 billion in that manner.
The budget performance report also showed that the sum of N18.5 billion has been disbursed to Health within the same period. Education has gotten N16.74 billion so far while N8.2 billion was expended on the ministry of Niger Delta.
According to the statement that was released by Festus Akabi, the special assistant on media to the Minister of Finance, Kemi Adeosun, N6.68 billion was spent on capital projects under Ministry of Science and Technology, with N312.5 billion spent on “other” areas of the budget.
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