Senate passes FG, States' $7.1 bn external borrowing plan

This followed the adoption by the senate of the report of its Joint Committee on Local and Foreign Debts and Finance, headed by Sen. Ehigie Uzamere.

The senate approval also covered the Federal Government’s pipeline projects under the Medium-Term External Borrowing Plan for the period 2012 to 2014.

The external borrowing plan is an essential component in the Medium-Term Expenditure Framework (MTEF) prescribed in the Fiscal Responsibility Act of 2007.

It is a pre-condition set by the senate to the executive arm of the government for the National Assembly to approve the 2013 Appropriation Bill.

The presentation by the Chairman of the Senate Joint Committee of Local and Foreign Debts and Finance, showed a proposed loan of $7.1 billion.

A breakdown showed that out of the $7.1 billion, the Federal Government had $4.8 billion, while the states were expected to get $2.2 billion.

The Federal Government had also proposed $1 billion and $100 million in continuation of its Eurobond and Diaspora Bond, respectively.

This brings the total external loans for the period 2012 to 2014 to $8.2 billion.

The Senate had referred President Goodluck Jonathan’s request for approval of the MTEF for the proposed pipeline projects to its Joint Committee on Nov. 7, 2012 for appropriate action.

The Joint Committee recommended that the senate should advise the Federal Government to forward a request for Lagos State.

It said this is ``in order to avert imminent crisis in the implementation of the 2013 budget.”

It also recommended that the senate should reject the Kaduna State proposal of $56.6 million from the French Development Agency, which was no longer required for its National Urban Water Sector Reforms.

The Joint Committee also urged the senate to ``ensure robust oversight by relevant committees on the implementation of these projects for which these loans were being approved’’.

One of the key projects earmarked is the Growth and Employment Project (GEM), with a credit amount of $140 million which has a maturity period of 40 years.

The projects expected to be located in Cross River, Kaduna, Kano, Lagos and Borno, were part of Federal Government's special intervention programme meant for job creation.

Meanwhile, the Chairman, Senate Committee on Appropriation, Sen. Ahmad Maccido, has called on the executive to do more in the area of budget conceptualisation.

``In the year 2012, there are some projects that happen to be in the budget but in the year 2013 they are no longer there and they are not completed.

``In place, we found new projects that are being coined as ongoing projects, which we believe are not ongoing.

``We have a record of them and we have compiled them. We are ready to show them when they are ready to sit down with us.

 ``But definitely they are not ongoing projects. As far as we are concerned they are new projects.

``They are new projects because they are not in the 2010, 2011 or 2012 budgets, but suddenly we found them in 2013. So they are not ongoing,‘’ Maccido further contended.