Funso Doherty, Action Democratic Congress (ADC) gubernatorial candidate in the 2023 general election has faulted Governor Babajide Sanwo-Olu N1 trillion borrowing programme, saying that there was no judicious use of previous loans taken by the state.
The Lagos government last week borrowed N100 from the financial market, the money is the first tranche of issuance bonds programme intended to raise N1 trillion.
But in an open letter to Governor Sanwo-Olu over the weekend, Doherty questioned the rational behind the new borrowing plan, saying that it was unnecessary and would only increase the debt burden of the state.
Doherty noted that previous loans taken by the state government in recent years, do not reflect in the existing infrastructures in the state or living State of Lagosians.
Doherty wondered why Lagos State would continue to borrow despite the huge Internally Generated Revenue (IGR) in the state monthly, which according to him is unaccounted for.
He said since the All Progressives Congress (APC) government assumed power in 2015, Lagos has become the most indebted in the federation.
According to Doherty, “Under the APC, Lagos State’s outstanding debt rose from approximately N235 billion in 2011 to N1.2 trillion in 2021.
“This is the highest amount owed by any state. By comparison, it was almost 4 times the amount owed by the next highest state (Kaduna) and more than the total owed by the next 4 states combined (Kaduna, Rivers, Ogun and Cross River) in 2021.
“Lagos State’s internally generated revenue (IGR), also the highest in the Federation, has risen from approximately N15bn in 1999 to approximately N570bn in 2021.
“The principal source of this IGR is the burden of taxes and levies borne by its residents and businesses that are productive, earning income and paying their taxes.
“Beyond this however, the greater responsibility of Government is to demonstrate the benefits that residents have derived from this ever-increasing tax burden borne by them.
“This responsibility also extends to Government borrowing because the burden of repaying the Government debt will fall on current and future generations through their taxes”.