Imo State N64 Billion Loan Saga: Tasks Facing Chief Chukwueke/PDP – By John I. Mgbe

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In the last few weeks, the media space in Imo State has been agog with all manner of reports on the alleged N64 billion loan which Governor Okorocha was alleged to have taken from Zenith Bank, Owerri. Most of us turned a blind eye to the imbroglio in the hope that it would fizzle out since it appeared to be a political sound bite or a storm in a tea cup, but rather than subside, the issue has even become more acrimonious as the parties in the brouhaha have become more desperate and combative in the struggle to overwhelm the other. The parties in this embarrassing face-off are Governor Okorocha’s Boys and the PDP as represented by Chief Jerry Chukwueke, a PDP Chieftain.

 

We are told that Chief Jerry Chukwueke had addressed some journalists while on a campaign  tour of Orsu Local Government Area and in the course of the interaction, he lambasted Governor Okorocha for taking a loan of N64 billion from Zenith Bank, Owerri.Furthermore, he went on to say that by taking  such amount of loan, Governor Okorocha had mortgaged the monthly allocations/Imo State to Zenith Bank. A top aide of Governor Okorocha swiftly issued a one week ultimatum to the Peoples Democratic Party( PDP) to produce verifiable and cogent evidence to prove the veracity  of the claim that Governor Okorocha took a loan of N64 billion from Zenith Bank. Furthermore, the aide to Governor Okorocha even threatened that he would resign from his job if PDP was able to prove the allegation beyond reasonable doubt. Since then, the pendulum has continued to oscillate over our heads as both parties are mired in the blame game. It has become necessary for some of us to get involved in this face-off in order to steady the tempest and allow sanity and decorum to prevail. In this viewpoint, I wish to draw attention to the challenges that face Chief Jerry Chukwueke and his party, PDP, as they   embark on the ongoing recrimination involving the alleged loan of N64bn and also what is expected of them as a formidable opposition party.

 

Before I veer into the kernel of the matter, I wish to advise the political appointees of Governor Okorocha to desist from giving ultimatums of resigning from their jobs, if certain malfeasance or infraction is traced to the State Governor. This sort of ultimatum coming from a junior officer in the pecking order of the political organogram is an abuse of due process and a travesty of a formal line of communication in any organized bureaucracy. The only person that can issue such ultimatum is the State governor, not even the Deputy Governor or Commissioners. The State Governor may wish to issue a threat to step down as governor, if certain misdeeds or high crimes are traced to him. He may also decide to remove his immunity and face trial if certain high crime is alleged to have been committed by him. As an aide to a governor or commissioner, you are privileged to see a lot of information: the good, the bad and the dangerous. When you come face to face wish such terrible information, you should not bolt away from the office and issue a public press release on what you have seen and why you must resign. If however you cannot come to terms with the shock, you can tender your letter of resignation in a respectful manner without causing undue embarrassment to your principal. Once you have accepted to serve as a political appointee, you lose your voice and you must stand by your principal no matter how rough the road or alternatively, you quietly bow out. So, our political appointees, no matter how highly placed in the pecking order should desist from issuing threats on why they will walk away from their duty posts. The maxim is: “When the kitchen is too hot, walk away with dignity without pulling down the political edifice”. At each point in time, the buck must stop on the Governor’s table and no other. Rather than issuing threats of resigning if records prove that Governor Okorocha borrowed N64 Billion, the governors aides should ask the PDP and Chief Jerry Chukwueke to prove that in taking the loan, the governor violated or breached  any section of the Constitution. Again, did the Governor obtain the consent of the State Legislature or was it arbitrarily taken without recourse to the Legislature? Does Governor Okorocha need to obtain permission from the PDP Secretariat in ImoState before it seeks financial accommodation from the deposit taking institutions (commercial banks) or from the capital market? In future, the aides to Governor Okorocha should ask pertinent questions instead of making comments in the heat of passion. For the avoidance of any doubt, bank borrowing is neither an impeachable offence nor a criminal act. However, those who borrow should borrow to fund investments and not to fund salaries, wages or consumables.

 

As I said above, there are tasks that face the PDP as it continues to tell whoever wants to listens that “Governor Okorocha borrowed N64bn from Zenith Bank Plc, Owerri and thus mortgaged the future of NDIMO. The pertinent questions the PDP/Jerry Chukwueke Group must answer include (1) Is there any section of the  Constitution of Nigeria that classifies public sector borrowing as a high crime for which a Governor or President should be impeached. If so, we humbly demand that the section should be cited to enable us argue from an informed mind.

(2)   Is Zenith Bank, the only bank that is handling the account of Imo State Government?

(3)   Is the special focus on Zenith Bank traceable to the fact that the Commissioner for Finance was serving in Zenith Bank before his emergence as Commissioner?

(4)   Did the Government of Ohakim/Udenwa get involved in borrowing during their chequered tenures (May 29th – 1999-May 29th, -2011)?

5.    Did Jerry Chukwueke and the PDP condemn or criticize   such borrowings?

6.    Are the PDP Group in ImoState aware of the statutory guidelines for borrowing by the States and the Federal Government?

7.    Do the PDP/Jerry Chukwueke have a record of the total loan exposure of the various states in Nigeria and the Federal Government?

There is a body called “The Fiscal Responsibility Commission (FRC)” which monitors all borrowings by States and Federal Government in order to keep a close tab on such borrowings and guard against abuse. The business of public sector borrowing is not an Over the Counter (OTC) affair where one walks into a patent medicine kiosk and picks any drug of his choice from the counter. Public sector borrowing is a highly regulated  domain where the States and the Federal Government are severely monitored  by oversight  agencies such as the Central Bank of Nigeria(CBN), the Debt Management Office(DMO), the Fiscal Responsibility Commission(FRC), the Ministry of Finance(MOF) and even the National Assembly(NASS). If Governor Okorocha is caught in the act of reckless borrowing, the right place to forward the report is to the Fiscal Responsibility Commission (FRC) and not to reduce it to political sloganeering or political jingoism, more so, since the people you are talking to do not understand anything about the primer of corporate and public sector borrowing/lending. They are unable to make any useful input for or against your findings. Once such reports are received by these bodies, they will use the laid down template to ascertain if such borrowings can stand the rigour of professional scrutiny. To most members of the citizenry including a cross section of the intelligentsia, any treatise on public sector borrowing or bank lending is like a rocket science.

 

Chief Jerry Chukwueke and the PDP should know that what is important in Public Sector borrowing is not total loan exposure, per se, but whether the statutory guidelines have been breached. The Debt Management Office (DMO) has set a limit that  a state’s indebtedness should never rise more than 50 percent of its annual revenues in the previous 12 months while the nation’s total debt should not be more than 40 percent of the GDP. So, before condemning Gov. Okorocha for borrowing N64 billion or so, the PDP should do a cocktail of background checks to confirm, amongst other factors, if the total loan exposure of Imo State Government is more than 50 percent of the state’s annual revenue in the previous 12 months. This information is very easy to be obtained by the PDP whose party is running the Central Government. All they need do is to ask the CBN, DMO, MOF and FRC to subject the lending profile of GovernorOkorocha-ledImoState Government to screening and advise if there is a violation of laid down rules. Again, the Deputy Speaker, Hon. Emeka Ihedioha, and indeed any of the NASS members can get such details by merely placing a phone call on the relevant office. Above all, the House Committee Chairman on Banking, Hon.Jones Onyereri, is a PDP member from ImoState. He is in a position to get all the crucial details in regard to the debt profile of Imo State Government. So, it is my candid advice that Chief Jerry Chukwueke and the PDP should get their records correct before making mountain out of molehill.

 

In order to add integrity to its opinion on the loan profile of Governor Okorocha’s Government, the PDP/Jerry Chukwuemeka should ask the Fiscal Responsibility Commissioner (FRC) to provide it with the Annual Report and Audited Accounts of Imo State Government to date or as at the period ended June 30, 2013 to enable them subject the borrowing to professional scrutiny.They should refer the  document to their team of accountants, bankers and economists to pore through  and translate the data to  information which most members of the citizenry can comprehend.

 

As a member of the Chartered Institute of Bankers of Nigeria (CIBN) and media professional with special interest in financial reporting, I regard Chief Jerry Chukwueke’s tirade on Governor Okorocha for allegedly borrowing N64 Billion  as lacking  substance as well as the fundamentals  required for a professional critique of the alleged borrowing. It’s like the fabled “Tale told by an idiot full of sound and fury signifying nothing”. Most of us are too developed to be carried away by such theatrics. So, they should go back to the drawing board and come out with credible details of the states borrowing and the fundamentals of ImoState revenue profile.

 

So, in future, the aides to Governor Okorocha should not issue threats to resign if their principal, the State Governor, is found to have borrowed any quantum of loan. The pertinent questions must be asked: Is it unconstitutional for Governor Okorocha to borrow money? Have the statutory guidelines been breached? Is there cogent and verifiable evidence that such loan was embezzled or used for purposes that are incompatible with the objectives of the borrowing? These are the questions that Governor Okorocha’s aides should ask and not give threats of resigning on the mere grounds that the governor borrowed from the banks Even the PDP federal Government is heavily indebted to banks and the highest borrower in the world is the United States Government , even though it is the most powerful country in the world.

 

One of the complaints of the PDP is that the N64 billion loans is tagged to the monthly allocation from the Federal Allocation. I do not know why this should be a source of concern to PDP. It has always been the rule for public sector borrowings to be secured with the monthly allocations from Abuja. Monthly allocations are preferable as collaterals because as liquid assets, they are easily turned to cash. Above all, it is a dependable source of security against borrowed funds. Does anybody expect Governor Okorocha to secure the loans by executing an equitable or legal mortgage over such public sector property as ImoStateUniversity, State Secretariat, Port Harcourt   Road, or even Government House, Owerri. Is he to secure the loan with a mortgage over his palatial country home in Ogboko? This is not feasible as such collaterals will not be attractive to lending banks. But were the PDP governors not securing their own loans with the monthly allocations to the state? Did the PDP Governors who ruled IMOState in the period 1999-2007 not borrow from the banks or the capital market? If they took loans, did Chief Jerry Chukwueke and the PDP members in IMOState kick against such loans? Did they not secure such loans with the monthly allocations from ABUJA?

I am aware that the Ohakim –led Administration got approval to float a N40 Billion bond from the capital market. The Administration eventually drew down about N18 Billion before it was voted out of office. Why was this bond not condemned by the like of Chief Jerry Chukwueke and other PDP stalwarts in IMOState in the same way they are complaining against the loans allegedly secured by Governor Okorocha? The difference between a loan and a bond is a matter of   semantics: while the former is obtained from the money market (commercial banks), the latter is obtained from the capital market. Repayment of both facilities is always a first line charge on the revenue of the borrowing institution. So, why did PDP maintain a conspiracy of silence over Governor Udenwa’s and Ikedi Ohakim’s borrowings and now they are screaming and railing against the loans incurred by the present Administration. Is it a case of selective justice or a dangerous case of amnesia? Again records show that Chief Ohakim was making a desperate bid  to secure an external loan of $60 million in the twilight  of his tenure .In the story with the headline:”IMO TO BORROW $6OM EXTERNAL LOAN”, THE LEADER, a newspaper of the Catholic Church, stated thus :”Imo State Government has finalized plans to borrow $60m from foreign creditors. This fact was contained in a request presented for senate approval on Wednesday, February23, 2011 by the Chairman of the Joint Committee on Finance and National Planning and Poverty Alleviation, Senator Ahmed MARKAFI”. Please read the Leader newspaper of Sunday, February 27th –March 6th, 2011. Those in the PDP who are screaming and swashbuckling over the so-called N60 billion loans from Zenith Bank kept silent while their PDP was negotiating for a $6o million loan in the last days of Ohakim’s regime. They said nothing while Chief Ohakim was negotiating for a bond of N40 Million. This is despicable and deplorable..

 

During the 12-year hegemonic rule of PDP in IMOState, there was no rendition of the   monthly statements of account –a document which they are now demanding from Governor Okorocha- for the 12 years they ruined IMOState. According to Lady Onyeka Onwenu, a top PDP Chieftain, the PDP-led Government of 2007-2011 was running a reckless Government which had no regard for transparency and accountability. Hear Lady Onyeka Onwenu: ”They are just interested in picking up government subvention and the State Government will take what they want; the godfathers will take their own and the Chairman (of the Government Agency) pockets what is left while the people are left with nothing”. Please read Sunday Independent newspaper of 1st August, 2010. So, with this sort of revelation from a reputable personality as Lady Onyeka Onwenu, the PDP lacks the moral high ground to pontificate on the imperatives of accountability, transparency and frugal husbandry of public sector funds. While I commend the efforts of PDP in making a case for effective opposition, they should approach their grievances with caution and moderation in order not to dance themselves lame before the real electioneering kicks off. Finally, it is my advice to the PDP to withdraw from the Ararume’s suit against Governor Okorocha’s victory in the 2011 election. This appeal which is in the Supreme court is highly provocative as the right thinking members of Imo State are looking forward to the 2015 election when the electorate will go back to the polls to vote in another election.When that time comes, those who are not satisfied with Governor Okorocha’s Administration can vote against him while those who support him can vote for him (i.e. if he runs). If PDP and Chief Ohakim pull out of that suit, it could give them some political mileage.So, PDP can facilitate the move to forget the past and look towards 2015 as majority of Ndimo are not praying for Okorocha to be sacked through the courts. They are asking for another opportunity to exercise their franchise and vote for a governor of their choice in 2015.The people are not happy that Senator Ararume who appears to have joined PDP is enjoying the tacit support of the PDP in protracting the suit in the Court of Appeal, Owerri and the Supreme Court. Since PDP has exhausted its chances in the Tribunal, Court of Appeal and the Supreme Court and lost, it should be humble enough to close the chapter and look towards 2015. A stitch in time saves nine.

 

John I. Mgbe

08032722897

 

Babatunde Akinsola
Babatunde Akinsolahttps://naija247news.com
Babatunde Akinsola is aNaija247news' Southwest editor. He's based in Lagos and writes on the Yoruba Nation political issues, news and investigative reports

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