Tue. Jan 19th, 2021

SERAP seeks strict control of borrowings by Governors

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In a bid to checkmate misappropriation of loans by state governors, the Socio-Economic Rights and Accountability Project (SERAP) has urged President Muhammadu Buhari to bar the 36 state governors from further borrowing and or withdrawing the sum of N17 trillion from the pension funds purportedly for infrastructure development.

In an open letter sent to President Buhari, the group urged him to urgently issue a directive to the director-general and board of the National Pension Commission (NPC) prohibiting further borrowings by governors.

The governors, last week, reportedly proposed to borrow around N17trillion from the pension funds after receiving a briefing from the Kaduna State governor, Mallam Nasir el-Rufai, who is the Chairman of the National Economic Council Ad Hoc Committee.

But in the letter dated December 5, 2020, and signed by SERAP’s Deputy Director, Kolawole Oluwadare, the organization said: “Allowing the governors to borrow from pension funds would be detrimental to the interest of the beneficiaries of the funds, especially given the vulnerability of pension funds to corruption in Nigeria, and the transparency and accountability deficits in several states.

“It is patently unjust and contrary to the letter and spirit of the Nigerian Constitution 1999 (as amended), the Pension Reform Act, and the country’s international anti-corruption and human rights obligations for the Federal Government and state governors to repeatedly target pension funds as an escape route from years of corruption and mismanagement in Ministries, Departments and Agencies [MDAs].”

SERAP expressed “serious concerns that the proposed borrowing by the 36 state governors from the pension funds would lead to serious loss of retirement savings of millions of Nigerians.”

“Allowing the governors to borrow money from the pension funds would amount to a fundamental breach of constitutional provisions, the Pension Reform Act, and Nigeria’s international obligations, as well as fiduciary duties imposed by these legal instruments on all public officers to prevent pension funds from unduly risky investments, and to ensure transparency and accountability in the management of pension funds.”

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