Should outgoing governors be starved of funds?

Governors-elect from some states like Imo, Oyo and Ogun recently cried out against outgoing governors’ last minutes withdrawals and spending. In this report, Associate Editor, Sam Egburonu, sought the views of some public administrators and others on whether outgoing governors should be starved of funds, when they should stop awarding new contracts or making huge payments, etc., and if attempt to stop them from accessing funds would amount to shutting down of governance?

ALLEGATIONS of last minutes withdrawals and awards of bogus contracts have sparked off verbal exchanges between some governors-elect and the outgoing governors. The Nation investigation during the week shows that this controversy has further worsened the already strained relationship between the political leaders and parties involved.

As the outgoing governors accuse the governors-elect of lacking the right to challenge them, concerned observers have raised some issues arising from the controversy. While some wonder if denying outgoing governors of access to state funds months before the expiration of their tenure would not amount to a move to close down governance, others said there is the urgent need to legally stop reckless spending by greedy outgoing governors who, in a bid to gather state resources for their personal retirement may put the in-coming government in unnecessary financial stress.

Dr. Sani Ajala, an attorney at law with bias in fiscal constitutionalism, who practises in Abuja summarised it when he told The Nation that “A governor-elect has no constitutional, statutory and procedural basis until sworn into office to meddle in the statecraft of his state. Similarly, an outgoing Governor of a state, by resorting to last minute fleecing of the assets of his state and brazen financial recklessness is simply warming himself and associates to safe passage to prison.”

Explaining the genesis of this ugly situation, Ajala said: “Let’s bear one thing in mind, if the machinery of the civil and bureaucratic service of a state is strong, the wanton disregard for extant financial/budgetary regulations will effectively be checked. But then, experience has proved otherwise due to the pervasive greed and kleptomania in our system.”

These verbal exchanges first caught public attention mid-March when the Governor-Elect of Imo State, Emeka Ihedioha, openly warned financial institutions against engaging in any last-minute transaction with the outgoing government, an action he described then as “illegal.”

While addressing journalists in Owerri, the state capital, Ihedioha said “persons or groups involved in such activities will be doing that at their own peril.”

Ihedioha, a former Deputy Speaker of the House of Representatives, said “May I use this opportunity to warn all those who may be tempted to do illegal last-minute transaction with the out-going government, particularly financial institutions which may result in further burdening the state with unsustainable liabilities that they will be doing so at their own peril.”

Ihedioha’s outburst trailed allegation that the Governor Rochas Okorocha  led Imo State Government withdrew a whopping N17 billion shortly after the March governorship election in which the governor’s candidate, Uche Nwosu of Action Alliance lost to the Peoples Democratic Party’s Emeka Ihedioha.

The Imo State chapter of PDP had accused Okorocha of withdrawing the alleged N17bn “from four banks in three days and of converting government property to personal use.

The state PDP Chairman, Mr. Charles Ezekwem, who made the allegation, said in a press conference in Owerri, “that between Tuesday, March 12, 2019 and Thursday, March 14, 2019, Okorocha made withdrawals from Access Bank, Zenith Bank, Unity Bank and Skye Bank (Polaris) amounting to over N17bn.”

The party also alleged that, “Okorocha and his cronies transferred ownership and re-registered more than 150 government vehicles to individuals.

“We are also aware of the rampant issuance of Certificates of Occupancy to family members and friends of the Okorocha family”, the party said.

In his initial reaction to the allegation, Okorocha, through his Chief Press Secretary, Sam Onwuemeodo, said, “There is a government in place and until May 29, 2019, that government should continue to work in the interest of the state and her people and also continue to carry out programmes and policies for the same purpose, until its tenure ends. To begin to harass or give directives to financial institutions in the state is an act of hostility and they should know that.”

In another reaction Okorocha argued that “with its meagre federal allocation and a paltry Internally Generated Revenue, Imo State did not have the N17bn said to have been illegally withdrawn” by him.

Imo is not the only state where the governor-elect had to raise such alarm. Recently, the Adamawa State Governor-Elect, Alhaji Ahmadu Fintiri, cautioned out-going Gov. Mohammed Bindow’s administarion against what he described as “last minute employment and award of bogus contracts.”

Fintiri, in a statement issued by his media aide, Mr. Solomon Kumangar, also urged banks not to give “arbitrary loans” to the out-going government.

“The governor-elect wants all unnecessary expenditure and last minute employment, not done in the past four years, halted forthwith.

“Similarly, all last minute awards of bogus contracts without following due process should stop.

“Adamawa belongs to all and any action to the contrary would not be condoned.

“Banking institutions are hereby cautioned against giving arbitrary loans or overdrafts at this time as this will be at their own risk.

“Civil servants who get involved in shoddy transactions, aiding and abetting fraud will have themselves to blame if discovered,” he said.

Other states where such desperate calls have been made include Ogun and Oyo.

Soon after his declaration as the winner of the governorship election, the Oyo State Governor Elect, Engineer Seyi Makinde, openly cautioned civil servants in the state against conniving with politicians ‘to rush out contracts at this eleventh hour.’

Makinde said this in a statement made available to journalists and signed on his behalf by Prince Dotun Oyelade.

He alleged that as soon as it became certain that he had won the election, “certain, top politicians in government started putting pressures on civil servants to hasten and/or originate contracts and facilitate payments of contracts that are yet to be satisfactorily executed.”

According to him, “The implication of such illicit deal should be very clear to any government worker who indulges in such collusion.

Similar controversy is also raging in Ogun State where the All Progressives Congress this Friday warned banks and other financial institutions against granting what it called “last-minute loans, overdrafts and other financial instruments to the outgoing governor of the state, Ibikunle Amosun.”

The party alleged that Amosun was planning to obtain loans and overdrafts two months to the end of his tenure.

In a press statement issued in Abeokuta and signed by its Publicity Secretary, Tunde Oladunjoye, the party warned banks and financial institutions not to succumb to alleged threats and pressures from Amosun to obtain loans.

“It has come to our notice that the outgoing governor has been exerting pressures on banks and financial institutions to grant frivolous loans, overdrafts and other instruments immediately Prince Dapo Abiodun was declared governor-elect.

“We are equally aware that files and other sensitive government documents are being moved out of government offices on the order of the outgoing governor, His Excellency, Senator Ibikunle Amosun.”

Bankers’ dilemma

A top banker with one of the banks named in the Imo State’s case, who pleaded not to be named, told The Nation that the development has put bankers and banks in an unfortunate dilemma. “How can you refuse to do business with a sitting governor and how can you choose to offend a governor-elect, who you know will be in-charge in the next four years. The matter is too complex and unfair to bankers and the banks. I plead that the matter be clearly defined. At what point should we begin to deal with the in-coming government officials,” he asked.

Call for legal framework

Dr. Ajala is of the view that there is the need for a legal framework to avoid such financial recklessness. As he puts it, “since the primary function of government is the protection of lives and property and since it abhors vacuum, much as an in-coming governor reserves the right to speak out against perceived systemic stripping of the resources of the state that he’ll soon be the man at the helm of affairs, a meaningful monitoring of financial transactions of his State with the view of constituting a strong committee to review the approval/expenditures of the state 100 days retrospectively is more tactical than needless filibustering with the sitting governor who is yet to exhaust his mandate of four years.

“To accentuate the mechanism of recovery of expenditures tainted with last minute recklessness, robust legal and justice framework is imperative. And sadly, this twin sectors are at the moment inflicted by debilitating virus both at the centre and the constituting States of the Federation. And yet, no harm in trying by a seriously change minded in-coming governors such as Hon. Emeka Ihedioha of Imo State,” he said.