Senate blame governors for economic decline in states

The senate on Thursday blamed state governors for the poor financial fortunes of their states. The lawmakers who warned the governors to address the economical decline, came to the resolution while considering the reports of the Joint Committee on National Planning, Appropriation, States and Local Governments.The senators while looking at the report said that states should do more to generate revenue, instead of waiting from proceeds from the Federation Account. The committee accused the 36 states of the federation of relying on federal government allocations, and are facing bankruptcy.

“The over dependency on oil revenue at the expense of Internally Generated Revenue by states is responsible for their continued call on the Federal Government to share the proceeds of the Excess Crude Account to meet the growing cost of governance in states.For instance, the sum of $1.5bn was shared in three equal instalments from the Excess Crude Account in 2011 alone, out of which the states received the sum of $400.8mn. The final payment amounts to $500m.” the report said.

Large amounts are removed from state allocations for the settling of their external and domestic debts, and bonds.
“Most of these loans are tied to irrevocable standing payment orders issued to the Accountant-General of the Federation to deduct directly from their monthly statutory allocations,” the report said.


The Deputy President of the Senate, Ike Ekweremadu, who presided over the session said “Essentially, no state is supposed to be bankrupt, but as we can see today, there is a problem of government meeting up with its obligations to the people because of mismanagement of state resources.”

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