The House of Representatives has mandated its Committee on aids, loans, and debt management to carry out a comprehensive audit and oversight of all loans obtained by the federal and state governments since the inception of the current democratic dispensation which stood at N121.67trillion.
The committee is to report within four weeks for further legislative action.
This followed the adoption of a motion moved by member, Lanre Okunlola at the plenary on Thursday titled, “Need to Ensure Public Debt Oversight on the Federal and State Governments Loans and Proper Utilisation of Borrowed Fund”.
Presenting the motion, he quoted the data recently released by the Debt Management Office (DMO) as of March 31, 2024 on Nigeria’s public debt profile, which includes both external and domestic debt.
According to him, the data has shown that the debt has grown significantly over the years and currently stood at N121.67 trillion ($91.46 billion) with loans sourced from both domestic and international lenders by the federal and state governments to fund various projects and budget deficits.
Okunlola stated, “Nigeria’s debt increased by N24.33 trillion within three months, rising from N97.34 trillion ($108.23 billion) in December 2023 to N121.67 trillion ($91.46 billion), as reported.
“While borrowing is essential for funding development, uncontrolled debt accumulation threatens Nigeria’s fiscal stability and future economic growth.”
He highlighted that “the 1999 Constitution of the Federal Republic of Nigeria, the Fiscal Responsibility Act (2007), and the Debt Management Office Establishment Act (2003) require the National Assembly to approve all government loans and ensure their proper use.”
“More than 40% of developing nations, including Nigeria, now allocate a significant portion of their finances to debt servicing, reducing funds available for critical sectors like education, healthcare, infrastructure, and social policy.”
The lawmaker expressed concerns over the increasing issues with oversight and transparency in managing borrowed funds at both the federal and state levels.