Members of the Enugu State House of Assembly have approved a N14.2 billion Naira loan request by Governor Ifeanyi Ugwuanyi.
The loan is to enable the government offset outstanding salaries/subventions, pensions as well as enable it embark on development and infrastructural projects.
A breakdown of the loan, which was approved on Tuesday includes: N4,207,000,000 for the arrears of salaries and pensions and N10 billion for development and infrastructural projects.
Passing the resolution on the motion on notice presented to the House by the leader, Hon. Ikechukwu Ezeugwu representing Udenu Constituency, the House averred “That this Honourable House do resolve to authorise the State Government to obtain loans of N4,207,000,000 (four billion two hundred and seven million naira) and N10,000,000,000 (ten billion naira) only, respectively from Central Bank of Nigeria (CBN) to liquidate arrears of salaries (subventions) and pensions and for development of infrastructural projects to be secured by excess crude account (ECA).”
The House reached the resolution to approve the loans based on the outcome of the National Economic Council (NEC) meeting of June 2015 that authorised CBN to create a pool of loanable funds up to a maximum of N10 billion for any interested state to access.
The House also noted that it was enboldened to authorise the accessing of the loans because the repayment period was spread for a twenty-year period.
“The loans carries a single digit interest rate of 9 per cent and tenure of 20 years repayment period, and it is cheap and convenient.
“Enugu State had earlier applied for the restructuring of its Commercial Bank loan of N6,413,942,870.84 as at June, 2015 and when this is approved, the monthly repayment will be reduced as the tenure of the loans will be extended over 20 years, thereby leaving reasonable balance monthly for the state to operate, and as such, the repayment of this bailout can still be accommodated,” the House stated.
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