Amidst the public outcry on the N40 billion loan restructuring in the state, the Bayelsa State government is heavily indebted to commercial banks to the tune of N140.17 billion, a development that costs the state treasury over N2 billion monthly in debt service.
According to data from the Debt Management Office, Bayelsa State, the domestic debt stock as of December 31, 2016, stood at N140.177,083,911.42, while the state's external debt is $47,756,175.63 as of June 30, 2017.
The Bayelsa State government has also said the approval it received from the House of Assembly on November 2, 2017, to restructure its existing N40 billion loan to complete ongoing projects was not a fresh loan.
The approval followed a written request from Governor Seriake Dickson to the Assembly seeking approval to “consolidate and restructure” the N40 billion loan from commercial banks.
The request was contained in a later dated October 30, 2017, and addressed to the Speaker of the Bayelsa House of Assembly, Kombowei Benson.
The letter sought permission to restructure existing bank loans to enable the state to channel more funds to government projects.
Daniel Iworiso-Markson, Commissioner for Information in the state, denied that the government was taking fresh loans in a statement issued on Monday in Yenagoa.
According to Mr. Iworiso-Markson, the restructured loan will enhance the speedy completion of ongoing projects across the three senatorial zones in the state, such as Sagbama-Ekeremor Road, Isaac Boro Road, and Bayelsa International Airport.
“The N40 billion is not a fresh loan, as being speculated. Rather, it is aimed at restructuring the already existing loan from the two- to four-year period.
“You know we took a N40 billion loan for the airport sometime ago, so what we are doing is that instead of paying the required over N2 billion every month, we have restructured it and so the time to pay the loan has been elongated.
“Rather than two years we will now pay it in four years and it will be about N1 billion every month.
“The other one will be given to our contractors. We don't want to handle it ourselves because if we do, we will still spend it on other things. So we have given it to a particular bank to distribute to our contractors. So clearly it is not a fresh loan,” he said.
The denial is coming on the heels of public outcry from labor leaders who had interpreted the consolidation of the loan to mean that the government was taking new loans in addition to existing ones.
It would be recalled that the State Assembly had on February 1 approved a loan request of N3 billion for the purchase of cars for the legislators and security agencies, a move that was described as a misplaced priority by civil servants who were owed six months’ worth of salary arrears.