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Reps intervene in $600m loan crisis between FG, Lagos State

The House of Representatives in Abuja on Tuesday intervened in a petition filed against the Federal Government by the Lagos State Government on alleged frustration of  600 million Dollars World Bank loan.

Rep. Adeyinka Ajayi (ACN-Osun), the Chairman of House of Representatives Committee on Aids, Loans and Debt Management, said the committee had invited the state government to throw more light on the loan.

In a presentation, Gov. Babatunde Fashola of Lagos state, said that the sudden stoppage of the loan had terribly affected the financial plans of the government.

 “We have a commitment with the World Bank for a loan of 600 million Dollars offered to Lagos.

“It is supposed to be in three tranches, and the first tranche was paid in 2011.

“We were expecting the payment of the second tranche when we got the shocking information that the loan facility had been stopped.  

 “As I speak, we have not received any official communication from the Federal Ministry of Finance about it concern.”

He said that the Minister of Finance told him by telephone communication that the state could not accommodate the loan in its 2013 borrowing plan.

The governor pleaded that the second tranche of the loan should be included in the 2013 borrowing plan and the third in the 2014 borrowing plan.

He lamented that before the sudden stoppage of the loan, the 2013 budget of Lagos state had already been planned in line with the requirements of the World Bank.

He said that he was not told why the loan was stopped suddenly.

He also stated that whatever was the reason, the interest of 20 million people living in Lagos should have been taken into consideration.

“I have to be careful with what I say here. Whatever may be the reason, I think the interest of over 20 million people must be paramount in policy formulations in this country.”

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