Senate Rejects FG’s $700m Loan Request For Water Projects

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The Senate Committee on Local and Foreign Debt has rejected President Muhammadu Buhari’s $700 million loan request for Sustainable Urban and Rural Water Supply, Sanitation and Hygiene (SURWASH).

The request was made under the Federal Ministry of Water Resources.

At the ministry’s budget defence session on Wednesday, the committee mandated the ministry’s delegation, led by the Permanent Secretary, Esther Walson-Jack, to provide it with an update of loans collected so far for the Water Projects in the ministry.

The rejection comes barely 24 hours after the Ministry of Health sought the approval of $200 million for the procurement of mosquito nets and malaria medicines.

At the session, the Chairman of the Committee, Clifford Ordia, and a few other members, noted that three different loans have been approved for various water projects.

Mr Ordia noted that $450 million was approved for the Ministry for water project being financed by Africa Development Bank and another $6 million loan under the integrated program for Development also financed by Africa Development Bank and Gurara water project.

Senate Rejects FG’s $700m Loan Request For Water Projects

“You need to tell us what you are doing with $700 million for water projects,” he said.

Other members of the panel, including Obinna Ogba, Sani Musa, Bima Enagi and Ibrahim Oloriegbe wanted the loan request denied because some loans had been collected for water projects in the past and results from the projects are yet to be seen.

“What is the criterion for selecting benefiting states? The details you are providing is not enough. What are the projects you want to do with $640 million and how many water are you going to do?

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“You are giving each state $3 million to develop personnel capacity, do we need loan to do this function? You mean all states can’t do that on their own?,” Mr Oloriebge wondered.

The lawmaker requested the criteria for selecting benefiting states, adding that details provided by the ministry’s permanent secretary are not enough to justify the loan.

Ms Walson-Jack, who was unable to give updates on previous loans approved for water projects, told the panel that SURWASH will last for five years.

She said $640 million out of the proposed loan will be used for the project, while the remaining $60 million will be used for capacity building.

“The proposal was negotiated with the World Bank on April 2021 and was approved at Federal Executive Council on August 11, 2021.

“States that would benefit from the $700 million loan from World Bank are Delta, Ekiti, Gombe, Imo, Kaduna, Katsina, and Plateau, with counterpart funding of $175 million.

“The programme will deliver improved water sanitation and hygiene services to 2,000 schools and health care facilities and assist 500 Communities to achieve an end to open defecation free status,” she explained.

The committee, therefore, resolved to invite the Minister of Water Resources, Adamu Suleiman, to appear before it for an explanation on the loan request and state of loans collected so far.