Banks Defend Aregbesola’s Spending Of Bailout Fund


Recipient banks of the bailout fund given to Osun State government yesterday said the fund was strictly used to pay salary arrears, allowances and pensions, in line with the Central Bank of Nigeria’s (CBN’s) guidelines.

Representatives of First Bank of Nigeria (FBN), Wema Bank and Zenith Bank, spoke during a presentation to the House of Assembly in Osogbo, on how the concessionary loan was disbursed.

The Assembly directed the banks, some government officials and organisations, to appear before it over how the N34.9 billion bailout fund was spent.

In their presentation, the banks said: “We ensured that due diligence was followed. We can confirm that we followed the CBN guidelines in the way and manner the loan was disbursed.

“It was used for the purpose it was meant – payment of salary arrears, allowances and pensions.

“Also, the figures shown in a slide by the Accountant General and Permanent Secretary, Local Government Affairs, were correct, so also are the balance figures in the banks.”

The Accountant General said the bailout was judiciously administered by the government without any underhand dealings.

According to him, the amount requested, which covered salary arrears, allowances and pensions, was N64, 327, 492, 947.01.

He stated that the state was however given, N25, 887, 975, 810.26, an amount, which did not include the pension arrears.

Kolawole said the pensioners were thus not captured in the bailout fund, saying Governor Rauf Aregbesola mandated that pension should be included in the disbursement.

He said: “On July 15, 2015 we requested for N64.3 billion to take care of all salary arrears, allowances and pension. But we were given N25, 887, 975, 810.26.

“No fund was released for pension and gratuity despite the fact that we included it in our letter to the CBN.

 “And we explained this to the pensioners repeatedly but they did not believe us.“If you look at the letter we wrote for N64 billion, it covered every category of staff. They (pensioners) won’t have been paid but for the magnanimity of the governor, who said we must include them because they had served the state diligently.

“It will also interest you to note that what I presented here on the floor of the House is the same document I sent to the ICPC and the EFCC.

“ICPC called me to a meeting where I gave them all the documents containing the transactions. When ICPC did not return, I believe it was satisfied with the information. The  EFCC did not invite me.”

The Permanent Secretary, Local Government Affairs, Mr. Muftau Oluwadare, in his presentation, said N23, 887, 975, 810.26 was requested from the CBN but N9, 117, 070, 000 was given to them.

According to him, it was this and that of the state that totaled N34 billion released to both state and local government.

He said the fund was also used as it was directed by the CBN to pay salaries of local government workers, primary school teachers and pension arrears.

Speaker of the House, Hon. Najeem Salam lauded the finance team for the clear presentation and the banks for their due diligence in the disbursement process.

Salam said it was not true the insinuations that the House was gingered to investigate the bailout fund based on the letter written by the Senate to investigate how the bailout fund was spent.

“We have been monitoring the activities of the executive on how the bailout and other loans are being spent.

“If the Senate wants to come for its oversight function, we will not stop them. But proper procedures must be followed. It has to come through relevant state authority, which is the state legislative arm,” Salam said.