The Socio-Economic Rights and Accountability Projects, SERAP, has asked the World Bank to probe the loans acquired by the 36 state governors in Nigeria and immediately suspend further loans to the states until they explain how previously acquired loans were spent just as some states have come under scrutiny for the amount spent on running costs.
While expressing concerns over the rising debt profile of the 36 states, SERAP alleged that the states had mismanaged and diverted public funds, stressing that it would be irresponsible to continue giving loans to the states.
The group’s Deputy Director, Kolawole Oluwadare, made the demand in a letter addressed to the World Bank President, Ajay Banga on Sunday.
SERAP noted that if the World Bank failed to probe the state governors, it would not hesitate to institute legal actions against the lending body and the 36 states.
‘’The World Bank and its partners cannot continue to give loans and other funding to these states where there are credible allegations of mismanagement or diversion of public funds.
‘’We are concerned that there is a significant risk of mismanagement or diversion of funds linked to the bank’s investments in many of the country’s 36 states. It is neither appropriate nor responsible lending to give loans to these states only for the loans to be misspent.
‘’The World Bank’s lending and support for these states may create the impression of complicity in the allegations of mismanagement or diversion of public funds by the states, which may include loans from the Bank and its partners and federal allocations. We would consider the option of pursuing legal action should the World Bank fail or fail to implement the recommendations contained in this letter, and we may join the country’s 36 states in any such suit.
‘’According to Nigeria’s Debt Management Office, the total public debt portfolio for the country’s 36 states and the Federal Capital Territory is N9.17tn. The Federal Government’s total public debt portfolio is N78.2tn.’’
SERAP urged the World Bank to use its legal powers to send independent monitors to all the states that had acquired loans from it and monitor how those loans were being spent so that loans acquired by the governors would not be used to fund their private lifestyle.
