N8bn Domestic Loan Increase: Gov. Adeleke Must Come Clean on Osun Debt Profile. By Adebayo Adedeji

In my previous writing interventions on Osun State, I maintained that the Senator Ademola Adeleke-led government, in 2023, secretly obtained loans in the region of N10billion. In their defence, the government's Alsatians in their grotesque characteristics called me names in an attempt to mislead the unsuspecting public. Since November, 2022,  when he assumed authority of the state, Adeleke has kept the true debt profile of the state a top secret for reasons best known to him and his mediocre kitchen cabinet. 

But the recently published audited financial statement of the state has further burst their bubble as the document in pages 60 and 61 reveal that the domestic debt of the state increased to N55.3billion in 2023 from N46.8billion the current administration met it in 2022.

A further study of the document indicates that a new Finance Lease loan of N4.2billion was obtained by the government in 2023. Just as the existing domestic debt of N705.6million for the Ministry of Agriculture and Food Security went up to N2.9billion. 

A N280.8million debt previously written against the Ministry of Rural Development and Community Affairs also rose to N1.4billion in 2023, in addition to the debt of the Ministry of Youths and Sports which leaped to N1.02billion from N161.7million. The summation of the additional loans to the above three ministries in 2023 was N3.92billion. 

The state also incurred a fresh loan of N10million against the name of University of Ilesa.

While the administration continues in its hide-and-seek, tongues are beginning to wag while a state government which devoted N19billion for the office of the governor in 2023 and is planning to spend another N13billion for the same office in 2024, would obtain loans of over N8billion to execute its projects.

Already, of the N13billion planned for the office of the governor in 2024, N8.9bn had already been disbursed as at end of June, the end of second quarter.

As part of the 2024 expenses for the office of Governor Ademola Adeleke, 20 Units of 2023  Model Toyota Landruiser Prado Jeep, valued at N3billion, have been approved for purchase. It is not clear how many units of the luxury cars have been bought so far. For the office of the governor again, 7 units of HP Pavilion Laptops, valued at N14.7million, are also in the budget for purchase. Just as N685million is earmarked for the renovation of the governor's office.

Why should the state governor budget this humongous sum for his office at a time many pensioners in the state still receive pittance of N5,000 every month? 

Why should a state governor who spent no dime to defray gratuity arrears and pension arrears from January-June 2024 invest scarce resources on frivolities and personal comfort? In the 2024 budget of the state,  N6billion and N5.4billion are voted for settling of gratuity arrears and pension arrears respectively, but nothing was released as at end of June.

If the government of Osun is making fortune out of the misfortune of the citizens as the situation appears to be, particularly in respect of the enormous allocation accruing to the state on account of high dollar rate through Foreign Exchange Rate Gains, it is sensible the government is motivated to give back to the financially troubled compatriots.  

Since July 2023 when the naira was floated and  foreign exchange market was liberalized by President Bola Tinubu, Osun State has received over N25billion as gains from the FX Exchange Rate.

Foreign Exchange Gain represents the difference between the exchange rate projected in the budget and the actual rate at which applicable revenue streams are converted at FAAC. For example, if the budget rate is N800/$ and the official exchange rate rate later turns to N1,500/$, as we currently have it in the country, there would be more money for the states to share from the federal allocation. What it means, in simple terms, is that the more dollar goes up and naira falls, the more state governments smile to banks. The concept presupposes that governors would plough back the gains to cater for welfare of the citizens whose businesses and livelihood are impacted by unfavourable foreign exchange rates.

Given what has come to Osun State in the last 14 months from Foreign Exchange Gains, there is no reason the state government should not have declared health and education sectors, at all levels, free. But sadly,  those critical areas of human existence are not the priorities of the state government. Even at that, the government still borrows to sustain the opulence of the state actors.