BY DAUD OLATUNJI & SEGUN OLATUNJI

Abeokuta—OGUN State government yesterday said the debt it owed banks stood at N37.9 billion, contrary to the report that it owed over N200 billion.

It equally said it had accessed only N5 billion out of the N29.3 billion the state House of Assembly approved as loans that could be accessed in this year’s Appropriation Law.

The government, however, said it had achieved a budget performance of 61.87 per cent in the first quarter of this year.

Commissioner for Finance, Kemi Adeosun and her Budget and Planning counterpart, Oluwande Muoyo spoke at a joint press briefing.

According to Adeosun, the state’s bank debt and obligations had risen from N35.66billion as at December 2013 to N37.9billion by the end of March this year, saying “The management of our debt to comply with debt sustainability recommendations of the World Bank and other policy makers is a key objective of this administration. In the interest of consistency, I shall restate the figures presented to the House of Assembly in January of this year which was bank debt of N35.66bn as at December 2013. This has increased marginally to N37.9bn as at March 2014.”

The finance commissioner however, assured that the state government would not “materially increase borrowings” this year, adding, “In the 2014 appropriation law, the House of Assembly approved that the government can source N29.3billion in loans. To date, we have accessed just 5billion of this as contractor finance obligations.”

She lamented that the persistent drop in federal allocation had constituted a strain on the finances of the state government, noting that the funds accruing to the state from the Federation account reduced by 26 per cent, falling from an average of N5.01 billion in September last year to N3.83billion as at March 2014.

The finance commissioner however said but for the increase in the state’s internally generated revenue of N4.64 billion which exceeded N4.11 billion Federal Allocation, the state would have found it hard to “weather the current challenging financial climate better than would have otherwise been the case.”