It has been observed that going by the current debt burden on Osun State, every citizen of the state owes N38,140.
This observation was made by Dr. Tunji Ogunyemi, an economist, and historian, during a radio current affairs program in Osogbo Monday.
According to Dr. Ogunyemi, Osun is the most indebted state in Nigeria after Bayelsa while Ekiti and Plateau follow directly behind, adding that Osun does not generate any revenue meager Internally Generated Revenue (IGR).
While advising that Osun manages its debt burden very well, he advised that politicking should be left out because Osun does not generate enough IGR to do anything significant about her domestic debt.
Dr. Ogunyemi revealed that the state had gone borrowing from the beginning.
In his words, “The burden of Osun State had been increasing from the beginning. There had been a gradual pile-up since the administration of Isiaka Adeleke.
“Both Prince Olagunsoye Oyinlola and Rauf Aregbesola added to the liability through the United Bank for Africa (UBA) and Sukuk loan, and This has impacted the state’s finances.
“40 percent of debt during the Aregbesola era was owed to Sukuk and will mature in 2026.
“Osun has no capacity for capital projects. The capacity for the state to earn IGR has diminished, except it goes borrowing again because her IGR is very insignificant.
“Osun can’t pay workers salaries from her IGR but would depend on the federation allocation to augment because of the low income.
“Osun owes N182. 7 billion, and it will take the state six years to pay back her debt.
“If anything happens to the IGR of Osun in two months without federation allocation, Osun will crumble and come on its knees,” he added.
He advised that since Osun was an agrarian state rather than a civil service one, as most pundits have always claimed, it should look inwards in tapping its human capital and natural resources as a way out of its debt burdens.
According to him, “It is possible for Osun to buy back her debt by floating bonds to its citizens.
“She could also look for opportunities of imposing taxes internally. Personal income tax is a means of improving IGR. It has to do something about taxation. Property and ground rent should be looked into because Osun is blessed with lots of land.
“Osun should also explore means to shore up IGR by taxing those who use her forests and tax sawmill businesses.”
Replying, the Chief Press Secretary to the Osun State Governor, Ismail Omipidan, stated that despite the situation, there is still hope in Osun as the current leadership is doing everything possible to inspire the hope.
He added that the administration has blocked some leakages and set government priorities right, especially when COVID-19 hit.
The governor’s spokesman noted that the government had discharged its responsibility, and he believed strongly that the situation would not continue like that.
“The debt profile of the state is a public issue already since the statistics are from authoritative sources, but when the state’s finances improve, the government will do the needful.”
While declaring that government will look at some of the suggestions, Omipidan revealed that templates and strategies are on the ground to improve the state’s IGR through agriculture, mining, and tourism, whose benefits would be reaped shortly.