FRC: 23 States Exceeded Borrowing Limits

FRC: 23 States Exceeded Borrowing Limits [See LIST]

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The Fiscal Responsibility Commission has said not fewer than 23 states have exceeded their borrowing limit in 2015 by limit contrary to stipulated guidelines.

In a report on the states and indebtedness, the FRC said listed the states as follows:

1. Lagos,

2. Kaduna,

3. Cross River,

4. Gombe,

5. Ekiti,

6. Edo,

7. Ondo

8. Imo states had borrowed more than 50 per cent of their annual statutory allocations by 2015.

Other states in the same boat are

9. Zamfara,

10. Adamawa,

11. Oyo,

12. Abia,

13. Ogun,

14. Taraba,

15. Kebbi,

16. Enugu,

17. Bauchi,

18. Nasarawa,

19. Kano,

20. Benue,

21. Kwara,

22. Katsina and

23. Sokoto

The FRC said in the light of the DMO’s Guidelines on Debt Management Framework only 20 states exceeded the threshold of 50 per cent of their total revenue – gross statutory allocation plus Internally Generated Revenue.

Lagos exceeded the threshold of 50 per cent of its gross statutory allocation by well over 300 per cent; Kaduna, Cross River, Gombe, Ekiti, Edo, Ondo, Oyo, Abia and Ogun exceeded the 50 per cent of their gross statutory allocations by well over 50 per cent but less than 100 per cent.

Imo, Zamfara, Adamawa, Taraba, Kebbi, Enugu, Bauchi, Nasarawa, Kano, Benue, Kwara, Katsina, and Sokoto states exceeded the 50 per cent of their gross statutory allocations by less than 50 per cent.

On the basis of total revenue rather than gross statutory allocation, 20 states exceeded the threshold of 50 per cent. Of the 23 states that exceeded the threshold of their gross/net statutory allocations, Kwara, Katsina and Sokoto states did not exceed the 50 per cent threshold of their consolidated debt to total revenue.

From 2012 to 2015, five states consistently exceeded the threshold of 50 per cent of their gross statutory allocations. The states are Kaduna, Lagos, Ogun, Cross River and Osun.