Accountability: Lagos State is Largest Sub-National Debtor: Where Are the Dividends to Residents?

Accountability: Lagos State is Largest Sub-National Debtor: Where Are the Dividends to Residents?

Lagos State reels in debts. With a debt stock of N2.58 trillion, Lagos state has emerged as the largest debtor in Nigeria in the comity of States according to statistics just released by BudgIT. This alone is more than 20 percent of all the debts owed by the 36 states of the federation and the

Lagos State reels in debts. With a debt stock of N2.58 trillion, Lagos state has emerged as the largest debtor in Nigeria in the comity of States according to statistics just released by BudgIT. This alone is more than 20 percent of all the debts owed by the 36 states of the federation and the Federal Capital Territory which stands at N10.2 trillion as of March 31, 2024.

In one year, the debt stock grew from less than one trillion, (N997,703,205,537.36) to N2.58 trillion. Exchange rate volatility may have been responsible for the rise. An exchange rate of N1,330/$1 was used for the computation. The debt stock is a combination of internal and external debts. More worrisome is that the state may not be slowing down on its borrowing.

Debt Analysis on State-by-State basis

Governor Babajide Sanwo-Olu, a former banker and financial expert is on record months back saying: “Lagos State will explore capital raising through the Nigerian Exchange Limited, NGX to fund infrastructure projects through equities, Green, Sukuk, and Blue Bonds”. Lagos state recorded the highest domestic debt in Q2 2023 with N996.44 billion, followed by Delta with N465.40 billion. Data is provided by the Debt Management Office (DMO), and verified and validated by the National Bureau of Statistics (NBS) published September 2023.

BudgIT is a civic organization that applies technology to intersect citizen engagement with institutional improvement, to facilitate societal change. A pioneer in the field of social advocacy melded with technology, BudgIT uses an array of tech tools to simplify the budget and matters of public spending for citizens, with the primary aim of raising standards of transparency and accountability in government.

The media holding the government to account as enshrined in the constitution calls for deeper interrogation of the activities of governments at different levels. In Nigeria, attention is focused more on the federal government while the states commit blue-murder with resources entrusted to them. The Houses of Assembly have failed to exercise oversight control and have become appendages to the executives.

DOMESTIC DEBT AND EXTERNAL DEBT DATA FOR THE 36 STATES OF THE FEDERATION AND THE FEDERAL CAPITAL TERRITORY Q2 2023

States Debts Analysis 2 States Debt Analysis

The Lagos Master Plan and T.H.E.M.E.S. Agenda of Sanwo-Olu
”The Lagos State Development Plan 2052 is built around four strategic pillars – Thriving Economy, Human-centric City, Modern Infrastructure and Effective Governance. Also, Governor Sanwo-Olu devised Project T.H.E.M.E.S, an acronym for his administration’s six strategic development agenda namely, Traffic Management and Transportation, Health and Environment, Education and Technology, Making Lagos a 21st Century Economy, Entertainment and Tourism as well as Security and Governance.

His first term agenda was anchored on the same T.H.E.M.E.S agenda, which encouraged him to take it to the “next level.” In his second term. The acronym was modified for Transportation and Traffic Management; Health and Environment; Education and Technology; Making Lagos State a 21st Century Megacity, Entertainment & Tourism; and Security & Governance. “Henceforth, it will be known as “T.H.E.M.E. S+,” the “plus ” representing the incorporation of an intensified focus.

Reviewing his performance in his first term, Governor Sanwo-Olu said that his administration has seen the rise of public and private infrastructure — “the largest single train petrochemical refinery in the world, the largest United States Consulate Complex in the world, the largest children hospital in West Africa, the largest rice mill in Sub Saharan Africa.”

Between Figures and Reality -What Is Seen in Lagos
As a Journalist, I learned early to be skeptical of statistics and figures emanating from politicians. They look good on paper but are at variance with the reality on the ground. Therefore, figures on income, expenditure, inflation, unemployment, debts, and debt servicing are better broken down into the ordinary man on the street’s language. Rather than say expenditure takes 60 percent of the budget while capital takes 40 percent. It is better understood saying 6 out of every 10 Naira will be spent on salaries and wages and debt servicing while only 4 out of 10 Naira will go for development projects and infrastructure. This deepens understanding and helps with interpretation.

The Challenge with the Lagos Situation
The challenge with Lagos State is that the residents rarely see where the money is going. Not that there is absolutely nothing being done as in some other states but what is being done is barely commensurate to the humongous amounts of money being announced annually and this calls for closer scrutiny. How does the government encourage the citizens to monitor its budget? There are no stated objectives with timelines and measurable milestones.

Against the T.H.E.M.E.S. agenda of Governor Sanwo-Olu, the impact is yet to be felt. The transport situation is still chaotic while traffic management has gone from bad to worse. There is no sanity on the roads because of lack of enforcement. Commercial drivers in Lagos are above the law and when they break the law by taking one way, they are received with a handshake by law enforcement agents at the other end as if to say, congratulations.

But credit must be given to the State government on its various rail projects both the blue and red lines. Though the overall impact is yet to be felt as they have also not been fully operationalised. One cannot but feel pity for masses of the people at the bus stops during peak periods trying to catch the limited numbers of BRT buses. This transport sector is one where a government could be adjudged as working or not in Lagos State.

On health and environment, recently, there was an outbreak of cholera in the state, and culprits were being sought when it is a notorious fact that Lagos lacks pipe-borne water. Gone were the days of functional public water works supplying water around the state. The Commissioner for Environment and Water Resources is an energetic young man making waves in Lagos by trying to clear the canals and waterways but he appears to concentrate more on the highbrow areas where the government stands to reap more revenue. He should spread his tentacles to the hinterlands where several infractions are gathering momentum.

There isn’t anything tangible on education and technology known in the public space. Maybe the Sanwo-Olu’s programmes on these are still in the works. The residents will like to know how many new schools have been built and their locations; the number of out-of-school students that have been integrated into the school system and how this has impacted on removing children from hawking and trading on the Streets of Lagos. On technology, how has the government deployed it into its services and how effective has it been. What is being done to promote technology in Lagos schools?

Making Lagos 21st Megacity?

This could be said to be an aspiration that Lagos State was working on by previous governments before Governor Sanwo-Olu. It appears Lagos State has lost that dream in the last couple of years. Things have been on the downward slope that many are quick to enthuse “This wasn’t the Lagos we used to Know”. “Lagos is no more working” and so on. How can Lagos fulfill its aspiration of becoming a megacity with such a rapid decline in many facets of life especially in its infrastructure?

Many roads and streets are in darkness at night. Criminals brazenly remove street lights by felling their poles without a response from the government? A megacity must have the infrastructure to monitor and safeguard installed public facilities and utilities; not appearing to be helpless. Whatever happened to the security vehicles purchased from the security funds being replenished annually? The various Police Commands in Lagos State must be tasked to protect the public utilities in their territories.

Finally, on Entertainment, Tourism, and Security. The crime rate is on the rise in Lagos. There have been a couple of reported cases of abduction, and it is risky to venture out at night in Lagos. The menace of Area boys and their harassment of innocent citizens is a minus on the entertainment and tourism sector in Lagos State.

The Sanwo-Olu government has to wake up and arrest the slides going on in the State. No nation has ever managed to be a great debtor and a great leader at the same time. Governor Sanwo-Olu should aspire to be seen as a firm and effective leader with good legacies and showing something tangible for the money being borrowed; the humongous Internally Generated Revenue and money from Federal Allocation. Governments are identified more by the personalities leading them than by the collective achievements of the team. That is why the Awolowo years remain a reference point in Yoruba history even up till now. A stitch in time saves nine.

Ayo Aluko-Olokun
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