By Edward T. Dibiana
The Anambra State Government has dismissed as ridiculous, Senator Ifeanyi Ubah’s allegations that the state lost N8 billion to banks in the contentious N25 billion promissory notes it drew ahead of its maturity dates.
Senator Ubah had claimed at a news conference on Friday, November 21, 2020, that Anambra State lost a whopping N8 billion as bank charges for accessing funds before maturity dates from the N25billion promissory notes, which the Federal Government used to reimburse the state in tranches for the reconstruction and rehabilitation of federal roads in the state over the years.
He also threatened to go to court against the state government if it fails to provide full information on how they caused the state to lose such a huge amount.
But responding to the senator, the Anambra state government dared him to proceed to court, as it said that “No such amount or anything near it was lost in order to get discounts on the tranches of payment to the state government through promissory notes of the Federal Government of Nigeria.
“It is awful to see a national legislator manufacture figures, driven solely by an ambition to become, by all means, the next Anambra State governor. Acts like these diminish the peddler, and proceeding to court with manufactured figures will bring such a person further to odium and public ridicule.
Giving reasons why the transactions were made by the state government, the Commissioner for Information and Public Enlightenment, C. Don Adinuba, in a statement on Sunday, November 22, which was made available to 365Daily, stated that, “Given the time value of money, it would be bad economics and a profound disservice to ndi Anambra to collect the monies on their maturity dates.
The naira has lost considerable value in recent years, exchanging now at almost N500 to one dollar in the parallel market, in sharp contrast to the exchange rate in 2003 when about a mere N80 could fetch a dollar in the same market. Naira’s rapid depreciation may continue. Inflation is today very high for various reasons. Whereas N100m could build a reasonable length of road in 2003 when the state started to reconstruct federal roads, the same amount can today build about only a fraction of the same road.
“The most reasonable thing for any state to do so as to have value for such reimbursements is to cash the monies now rather than to wait for more years. This would entail some discounts. The Anambra State government did just this. The proceeds are stated clearly in the Report of the Accountant General, with Financial Statements, for the year ending December 31, 2019. The proceeds are also part of the 2020 Anambra State budget estimates. Ubah may not have read the budget.
“It is worth pointing out that the Central Bank of Nigeria came to the aid of 22 states, including Anambra, owed for reconstruction of federal roads in their territories with a concessionary single digit discount rate. How a single digit discount rate on N25bn promissory rates, as in the case of Anambra State, would amount to a whopping N8bn is a mathematical mystery which only Ifeanyi Uba can solve. “
But speaking to 365Daily on Monday, November 23, in response to the state government’s position on the issue, Senator Ubah’s spokesperson, Kamen Chuks, said the government should be asked to disclose what constitutes the single digit payment it forfeited to the banks. “If they deny that they didn’t pay 15 percent of the N25 billion to banks in order to access the funds before maturity dates, then they should tell Anambra state people how much was paid in monitory terms to banks.
“You see, one thing that is clear to everyone now is that the state has liquidated the N25billion in question and it’s the right of Anambra people to demand for accountability. What was the money used for? If Senator Ubah hadn’t called attention of the people to this government’s imprudence, it would have been business as usual. Anambra state under this current administration, continues to run an opaque financial policy. And this isn’t right in a democracy.
“Again, why is the governor in a hurry to embark on capital projects in the twilight of his administration, when he had all the time before now to start and complete any project that he desired?” He queried.
Commissioner Adinuba, however, insisted that the money is being judiciously deployed for the good of the state and its people.
According to him, “Let it be stated for the umpteenth time that Anambra State has no reason to delay collecting its monies. It is currently building the most modern airport in the nation, without borrowing a kobo anywhere and without owing any of the contractors; the airport will be commissioned next April. Anambra State is building an international conference Centre with a sitting capacity of 10,000, which is the biggest in Africa, without borrowing any money from any financial institution and without owing the contractor; it will be ready next March.
In addition, it is building the Awka City Stadium, as usual without borrowing a kobo and without owing the contractor; the stadium will be ready before February. Anambra State requires N150bn to complete the ongoing building of numerous roads and bridges in the State. And Nigeria has entered a recession, with all the consequences. So, why wait in perpetuity to collect monies whose value depreciates fast?
“Anambra State remains exemplary in financial management. It is one of the few states which did not apply for a bailout from the Federal Government, even when states which receive fortunes monthly for oil-bearing received such assistance to enable them to discharge their basic obligations.
The World Bank has since September, 2018, commended it for being the best implementer of projects in the South-east and South-south. Last August 19, BudgIt, sponsored by the Bill and Melinda Gates Foundation, declared Anambra State and the petroleum-rich Rivers State the states with the highest fiscal responsibility index in the whole country.”