The 17 newly elected governors will have a difficult time boosting the economies of their various states since they will be left with debts from their predecessors totaling at least N2.1 trillion in domestic debt and $1.9 billion in foreign debt.
Investigations by Saturday PUNCH revealed that some of the first-term governors-elect would also have to deal with many months’ worth of unpaid workers’ salaries and growing pension liabilities amid protests for the implementation of the national minimum wage, rising inflation, skyrocketing prices of goods and services, and declining purchasing power.
On March 18, 2023, governorship elections were held in 28 of the 36 states of the union, and a total of 16 governors-elect were elected to succeed their predecessors, who will serve out the remainder of their constitutionally mandated second terms. A first-term governor, however, lost his bid for reelection to the candidate of the opposition party.
The country’s entire domestic debt as of September 30, 2022, according to the Debt Management Office, was N21,551,924,507,448 while $39.66 billion was owed to international creditors.
Aside from eight to fifteen months’ worth of overdue pay, Rev. Fr. Hyacinth Alia of the All Progressives Congress will succeed Governor Samuel Ortom of the PDP in Benue State. He will also inherit N143,368,150,982.89 in domestic debt and $30,472,977.14 in debt to foreign creditors.
Bassey Otu, who would succeed Prof. Ben Ayade as governor of Cross River State, will be responsible for paying off N175,198,799,155.96 and $215,754,975.33 that Prof. Ayade left behind. Both are members of the APC.
Delta State Governor Ifeanyi Okowa will leave a total domestic debt of N272,612,510,528.95 and a foreign debt of $60,046,972.41 to his successor, Sheriff Oborevwori. While Oborevwori is the Speaker of the state House of Assembly, Okowa was the PDP’s vice presidential candidate in the presidential election held on February 25.
The APC’s Francis Nwifuru will succeed David Umahi as governor of Ebonyi State and inherit debts of N67,060,019,562.44 and $59,841,539.37, respectively, from his party member.
The state’s debt level is as high as the fervor and joy that greeted the election of Abba Kabir of the New Nigeria People’s Party as governor of Kano State. Kabir will receive the N125,186,662,228.72 and $109,422,176.85 owing to domestic and foreign creditors, respectively, that Governor Abdullahi Ganduje inherited from the APC.
While both individuals are members of the ruling APC in Katsina State, the transition between Governor Aminu Masari and Dr. Dikko Radda should go well. But the new governor will also take over obligations to local creditors totaling N62,374,809,154.32 and obligations to foreign creditors totaling $55,824,330.35.
While the Independent National Election Commission pronounced the Kebbi State governorship election to be inconclusive, the debt profile that Governor Atiku Bagudu of the APC has left behind is without dispute. The state owes local businesses and others N60,131,306,074.57, and it has $42,403,327.93 in international debt.
Abubakar Bello, the governor of Niger State, will leave his fellow APC member and successor, Umar Bago, debts totaling N98,262,195,557.88 and $69,266,186.30, respectively.
In addition to transferring power to Mr. Caleb Mutfwang of the opposition PDP, Plateau State Governor and Director-General of the APC Presidential Campaign Council, Simon Lalong, would leave behind N151,903,415,543.09 in domestic debts and $33,735,927.81 in liabilities to foreign creditors.
The leader of the disgruntled PDP governors, also known as G5, Nyesom Wike, will hand over the reins of Rivers State to his appointed successor, Siminialayi Fubara, who will inherit a domestic debt of N225,505,011,356.00, according to the DMO, while the external debt of the oil-rich state is estimated at $140,177,828.95.
Aminu Tambuwal, the chairman of the Nigeria Governors’ Forum, will take over Sokoto State to Ahmed Aliyu of the APC on May 28 along with a total of N85,584,818,029.23 in domestic debt and $37,127,361.58 in international debt. Tambuwal will end his eight-year, two-term PDP tenure.
Governor of Taraba State Darius Ishaku would transfer N90,807,647,838.11 in domestic debt and $22,280,666.87 in foreign debt to fellow PDP member Kefas Agbu.
The combined debt of the 17 states, whose new chief executive officers will assume control on May 29, 2023, is N2,103,343,925,388.89 for domestic contractors and other creditors and $1,755,968,311.36 for foreign creditors.
Several of the newly elected governors will also have to deal with displeased employees and pensioners as a result of their predecessors’ failure to make payments on time.
The state ministry employees are not getting paid, according to Uchenna Obigwe, the chairman of the Nigeria Labour Congress in Abia State. Employees of the Abia State University Teaching Hospital, Aba; the Abia State Polytechnic; the Abia State College of Education (Technical); secondary school teachers; the Abia State Universal Basic Education Board; and retirees are among those that due money.
“None of them, particularly the employees of Abia Poly, Arochukwu Technical, ABSUTH, and HMB, are owed less than 10 months. Some owe back pay for more than 20 months.
By saying, “If the administration has the intention to do something, it would have done it before the election to appeal to the workers to vote for the ruling party’s candidates,” Obigwe expressed doubt that the Ikpeazu administration would be able to pay the outstanding liabilities before leaving office.
“That is when they would have carried things out. Nonetheless, they chose not to. Even the leave allowance wasn’t paid by them.
“State public servants were owed five months’ worth of unpaid wages in 2017,” a civil servant in one of the ministries who only wanted to be known as Daniel said, “and aside from that, what we were paid early this month (March) was the salary from November.
Hence, the government now owes the state employees four more months’ wages, for a total of nine months.
Local government employees were in a similar scenario because it was claimed that they were owed 11 months’ worth of wages.
According to local government employee Joshua Terna, who made the statement, “The local government workers were owed seven months’ salary in 2017 and if we add another four months from December 2022 to March 2023, it is now 11 months.”
The worst affected are reportedly primary school teachers, who are owing between 14 and 15 months’ wages, while secondary school instructors are purportedly owed between 8 and 10 months’ wages.
You have a lot of options; depending on the loan’s origin, you might be able to ask for a longer moratorium or an extension of the term. Debts can also be renegotiated. There are also situations where you can discuss the potential for a debt exchange or perhaps some long-term bonds to at least be able to create enough resources, regardless of whether the debt is local or foreign.
“Most importantly, it depends on how the funds were used; some governors have borrowed money and invested in essential projects and infrastructure. If the investment is successful, it will help the state produce enough money to be able to pay back such facilities.
What I anticipate is that each state will assemble a group of professionals with economics and financial expertise so they can meet with the creditors and, where possible, negotiate some of the terms.
“One of the issues in our society is that people make promises without checking the facts and data,” he continued. The reason why so many people have been let down is that when promises are made and by the time they receive facts and figures, they find it very difficult to fulfill their promises. In an ideal world, I also expect that before making promises, you want to first know what is the revenue profile that you are expecting, both in terms of federal and internally generated revenue.