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I inherited N117bn debt from Agagu – Mimiko

By Dayo Johnson
GOVERNOR Olusegun Mimiko of Ondo State yesterday made public the position of the state finances, revealing that the immediate administration of Dr Olusegun Agagu left N117billion debt for his administration.

In a swift reaction, however, the immediate past governor Dr Olusegun Agagu said the allegation was diversionary and a way to cover the present administration’s lack of vision.

In a statement to newsmen in Akure yesterday, Dr Agagu said “our government did not owe a dime as at the time Mimiko was installed.”

Speaking through his former Chief of Staff, Mr. Femi Agagu, the former governor said “In fact we had paid 50 percent mobilization on most of the contracts awarded and had enough money ready for any certificate that cold be due.

“We were not owing salaries, allowances, banks or contractors. The whole issue of debt is diversionary and a way of covering their lack of vision.”

The incumbent governor in his broadcast said over N282b accrued to the immediate past administration in six years, while only N51b accrued to the late Chief Adefarati administration between 1999 -2003. According to him, the N117bn left behind by Agagu as commitment on contracts and other liability was about 300% above the N34.2b which his government met as liquid assets from the Agagu administration.

The Governor pointed out that given the wide gulf between the inherited State’s liquid assets of N34.2b and the liabilities of N117b the situation had placed a lot of stress on government in meeting the genuine aspirations of the people of the State as encapsulated in its manifesto.

He further said that “at the present level of income, and even without government embarking on any new capital project expenditure, it will take us at least Ten years to meet these commitments.

The reality from the foregoing therefore is that the State will have to re-prioritize

ongoing capital projects.”

Describing the spending as mindless and questionable, Dr Mimiko said that this suggested “a deliberate action particularly after the July 25, 2008 Tribunal verdict, to render the State bankrupt as well as a hint of a predatory mindset determined to lay the finances of the State to waste rather than leave behind a healthy balance in the event of a court-ordered ejection from power.”

“The value of such contracts awarded between July 25, 2008 when Election Petition Tribunal gave its verdict and the Court of Appeal affirmation of February 2009 was in the excess of N51.1Billion. This exceeded the value of those awarded in the entire first four years of the administration.”

Dr Mimiko equally revealed that contracts for road construction and buildings attracted 50% mobilization fee in those seven months of contract bazaar as against the 30% obtainable in the preceding era and as sanctioned by extant financial regulations.

He listed some of these projects with funny payments obviously used to skim the State of billions of naira as: the Ajagba-Iyasan Road whose earthwork component worth N300M, earlier done early in the Agagu Administration was duplicated and the entire contract was re-awarded to Messrs GSQ Ltd for N902m.

The governor said that a Lawn mower for the Golf Course project in Idanre was supplied for N1m when a lawnmower of the same specification sells for N65, 000.00 per unit in the open market in Akure.

The Owena Multipurpose Dam, a contract of N14Billion was hurriedly rushed through, out of which N3.8Bn was paid few days to the exit of the administration.

According to him, the State government had approached the World Bank to help procure the services of a consultant of international repute to help re-assess the project.

The Adagbakuja New Town, a project initiated by the Adefarati Administration under the name, Ugbo New Town and for which that administration had carried out an Environmental Impact Assessment through the Ondo State Oil Producing Area Development Commission

The governor disclosed that when Dr. Agagu came on board, the Environmental Impact Assessment was replicated for N25m followed by a Master Plan design (Urban and Regional) at N95m while another N70M was spent on a purported ‘Master Plan (Engineering).’

“A contract of N6.7Bn was awarded for sand filling of the area with 100% payment already made without retention fee for post-consolidation period as conventional practice requires.

Meanwhile, aides to the former governor said that Dr Agagu would react to the broadcast after he might have digested the content thoroughly.


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