{OBSERVATION} “Òsun Debt profile, Don’t Go That Route Again: An Admonition To Governor Oyetola (Part I)

by Adabanija Kamorudeen

{OBSERVATION} “Òsun Debt profile, Don’t Go That Route Again: An Admonition To Governor Oyetola (Part I)


What are the renewed attempts and why?
deduction and the bubble game
The genesis of “other deductions” beckoning for disclosure from Governor Oyetola
Why the mathematics will not add up
Gentle reminders to Governor Oyetola and the Opportunities for Restitution
DIFFERENT figures had been released at different times by official and unofficial spokespersons of Governor Adegboyega Oyetola as the loan repayment figures of the State of Osun. At every point in time, attempt has always been made to “sex up” the figure with about 10-to-12 billions naira, representing an overstatement of 15 to 25 percent, higher than what it should be. In the most recent jaundiced publication, the issue was lumped up with the loan amount, which was sexed up to N200bn. While I will quickly submit here that there was no such loan amount anywhere, talk less of it being bequeathed on Oyetola’s administration, however, the loan repayment will be the focus of the Part I of this write up. So, what can be the objective of the current government of Osun?

The objective is to make excuses on why the current government has had to abandon projects and programs that have always endeared Ogbeni Rauf Aregbesola to the public in Osun, or to divert the attention of the people from the increase in the Internally Generated Revenues (IGR) of the state and the FAAC allocations for the past two years (2020 and 2021) until the recent flash in the pan drop in the revenues.

The allocation had increased since 2020 until January 2022, when fund allocation from federation account fell by 18 percent, a shortfall occasioned by the increase in petroleum subsidy as benchmark price used to price the main input by global refineries increased. The December FAAC allocation (distributed in January 2022) has dropped from N700bn to N575bn January 2022 allocation (distributed in February 2022. The drop represents 18 percent drop in revenue, accruing to all the states. But this drop is not sufficient to reduce the state of Osun’s monthly revenues from an average of N4.1bn to a level at which the inherited monthly loan repayment of N1.5bn would have thrown the net receipt into a negative figure. Let someone in Oyetola’s administration swear on oath that the gross revenue had dropped to that “level”.

That the same unpopular medium (a newsprint) was used surreptitiously by the government of Osun to pollute the air again was not surprising because it was used to spread falsehood, previously on the funding of High Schools, when the use of Sukuk bond is glaringly in the public domain as the funding source of high schools. That junk went ahead to lie that a commercial loan of N16.5bn was used at over 21 per cent per annum interest rate. Compromising (conering) a newspaper by an official of government to spread falsehood is not only morally bankrupt, it is mortally immoral. Simply, because this bottom of the barrel newspaper would not ask them to support their figures with evidence or conduct investigative journalism on the issue. The paper however, gave them away, sheepishly, this time, by mentioning N1.45bn as monthly deduction attributable to Aregbesola’s loan (not minding the description). They have probably forgotten that N1.8bn had been fabricated and given to another journalist, who refused to publish it, when they couldn’t substantiate the figure. Even at that the 18 per cent drop in the federation revenue cannot result into a negative receipt of revenues. Fortunately for their clandestine motive, the Federal Ministry of Finance does not publish monthly allocation of the individual states again.

But we know the total loan deduction at the inception of Oyetola administration was N2.4bn. With completion of conventional bond (1st tranche) in July 2019, it fell to N1.8bn and by April 2019, it fell to N1.5bn, after the completion of Sukuk bond. I can autograph this figure, any day and anywhere. Data don’t tell lies. Therefore, anything significantly above this must be “other deductions” attributable completely to Oyetola’s administration and which must be exposed. This is the reason Oyetola should be admonished not to take this route again, which will lead his administration into another conundrum, similar to the media fiasco generated on its failed and highly tele-guided integrity test of the prejudiced four high schools and the subsequent, self-inflicted charades of “brain tests” of Oyetola’s Olaiya bridge, with due respect to Hon. Kolapo Alimi, the propounder of the brain test in the taxonomy of politics of Osun. Going this route again will be a big mistake in an election year.

The government of Oyetola in its usual perfidy has failed to disclose publicly this “other deductions”, generated under Oyetola’s current administration or inherited, which must have resulted into their purported negative receipts in February, if there is any? We know that all the states in the federation have been at loggerheads with Federal Government on various deductions such as dues to consultant that processed Paris club refund, restoration of deductions that Federal Government suspended during the COVID-19 and many others on the negotiation table that had nothing to do with loan repayment deductions. The restoration of the suspended deductions, totaling about N450m monthly is part of the N1.5bn monthly loan repayment (my own figure), mentioned above and has always been factored into the loan repayment analysis here and in any of our explanations. So, its restoration cannot be the sole reason for Oyetola’s purported negative receipt from Federation Accounts. It will not add up, iteratively, no matter the permutation and combination employed, it will not add up.

If the government has shirked its responsibility of renegotiating its obligations and refinancing its portfolio, when interest rate fell from 14 percent to 10 percent in the first quarter of 2020, so who is to be blamed? If it has abandoned its responsibility on federal matters, why should it be bothering people now, crying hoax and fouling the air. After all, its audited government accounts for 2020 have shown that the Internally Generated Revenue has increased to N19bn annually as a result of the assets he inherited, when he “applied” for the job to become a Governor. Oyetola has been described as Encyclopedia of Finance, so we don’t need to tell him that his IGR is expected to be the source of its loan repayment and that FAAC allocation source is used in a short-run according to bone-head finance course module.

Also, pundits have alluded to the fact that the recent episcopal message by the “Papal” of Ijesa North Anglican Communion could have sent apprehension to the incumbent government, who took it as a friendly fire. The non-political message, from our Lord Bishop Oluyamo that there could be a fiscal (revenue) challenge that may affect future salary payment under Oyetola. So, to preempt the issue and to absolve itself of the moral burden it carries as the main part of the previous government, the current government decided to hang the baggage on Aregbesola’s neck, by going back to its vomit on the debt bubble game. In its usual, dissembling characteristic of “a whodunit syndrome”, the smear campaign against Ogbeni Aregbesola is resuscitated, pronto!!

It became nauseating during the last quarter of 2021, when their propagandist published on social media the falsehood on the 33 months loan repayment of the administration. I had presumed the period to be from November 2018 to July 2021 because accounting in government is on cash basis and revenues from federation accounts are earned in arrears. Unfortunately, the Commissioner for Finance corroborated the figure in his press release on refunds from federal government. Their figure was so awful and scandalous that I had to write emails to the current Commissioner for Finance, Mr Bola Oyebamiji to check his figure on the unsavory repayment of N67bn 33months (from November 2018 to July 2021). My calculation then, revealed that the 33-month purported loan repayment figure was “way off” by more than N10bn. I didn’t get a reply but I believe they got my message that throwing a figure that does not recognize refunds or reversals by the Office of Accountant General of the Federation is tantamount to running an opaque finance.

So, what could be the basis for this unholy behaviour by an administration that was berthed by Ogbeni Aregbesola, himself and for a current government that is headed by someone, who was his Chief of Staff for eight years and who was the “Chief Host” of all the state tenders board meetings in our first term. I never heard him object to any of the expenditures that came to us for approval then and nobody had the temerity to turn down expenditure requests of the government agencies that were reporting, directly to Oyetola, then. So, what must have gone “hairy”, now that he is the governor and why can’t he rein-in his men, both official and unofficial media men.

In part II, I will be drilling down on the loan repayment figures (the actual and the shamefully fabricated) by breaking them down, item by item and its space permits, I will launch into the total loan amount debacle and the expository on the total loan conjecture.

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