The Chairman, Senate Committee on Power, Gabriel Suswam has given an insight into why all loan requests brought by President Muhammadu Buhari to the Senate are approved so that the Senate is not used as an alibi for the government’s non-performance.
On Wednesday, the senate approved a $6.1 billion (N2.343 trillion) loan request by the president.
The former governor, however, expressed concern over the spate of borrowing, saying it was mortgaging the future of younger generations of Nigerians.
He said a situation where the country borrows every year to fund the budget was not sustainable, adding that it was the reason most financing items in the budget were not realisable.
Suswam, who was speaking in an interview, expressed fears that with the trend of borrowing, it was obvious that even the 2022 budget cannot be implemented.
“You remember there was this thing then that the 8th Assembly was too antagonistic of the president and not allowing him to work and so the 9th Senate has decided to allow the president work and so whatever he brings, we are in partnership and we approve it so that there is no excuse.
“But on a more serious note, I am very worried at the level of borrowing. Where we stand, we have about N33 trillion debt and we are borrowing every year to fund the budget and the implication is that we have a deficit of over N5 trillion this year and with additional borrowing, in next year’s budget the deficit is going to be in the neighbourhood of N8 trillion.
“Now, how do you sustain that? First, we have breached the fiscal responsibility act which provides that 3 per cent should be the threshold and for last year, it was about 4 per cent. We are breaching the same laws we made for ourselves and they are saying that we should amend the fiscal responsibility act to accommodate any kind of borrowing that we intend to do,” he said.
Suswam lamented that the deficit has messed up the exchange rate, brought in double digit inflation and the economy has become unmanageable, while both macro and micro economic activities have completely broken down.
“Continuous borrowing is mortgaging the future of our children but without sounding like an opposition person, I’ll like to say that for any government to continue to borrow to fund its budget is completely heading towards a disaster because we are going to borrow for the supplementary budget of slightly above N900 billion and the deficit is N842 billion.
“I’ve never seen a budget like that, that is very bad budgeting and adds up to the stock of the deficit so for the 2022 budget, the deficit will be in the deficit of N8 trillion which means that that budget ab initio is not implementable. Even to implement this budget is difficult because most of the financing items are not realizable so where do we go from here?
“So for me, as an Assembly that wants to cooperate with the executive so that we are not seen as those who are stopping him from working, we have continued to approve requests from the executive that require us to allow them to borrow so that they can finance infrastructure. Whether we are seeing the infrastructure is another thing, we will continue to give those approvals whether they are on ground or not,” he added.
