In response to the Lagos State Government’s decision to raise a 10-year bond at a 13% fixed rate to fund the renovation of public schools, Gbadebo Rhodes-Vivour, the immediate past Governorship Candidate of the Labour Party, and a prominent advocate for fiscal transparency and accountability expressed concerns about the state’s unsustainable debt burden and the need for more responsible financial management.
Rhodes-Vivour highlighted the alarming increase in Lagos State’s domestic debt, which rose by 269 per cent from December 2015 to December 2022. With a total debt of NGN807.21bn, Lagos state now holds the highest domestic debt among sub-national entities in Nigeria.
Despite Lagos being a top revenue generator, Rhodes-Vivour pointed out that other states, such as Rivers, Kaduna, Ebonyi, Sokoto, Kebbi, Cross River, and Akwa-Ibom, prioritize investing in capital expenditure over operating expenses. He emphasized the need for Lagos state to exhibit greater fiscal responsibility, as it currently ranks 25th out of 36 states in terms of debt sustainability.
Citing the Sub-national Audit Efficacy Index 2022 report by Paradigm Leadership Support Initiative (PLSI), Rhodes-Vivour highlighted Lagos State’s low ranking in fiscal transparency and accountability, placing 18th out of 36 states surveyed. The lack of timely audit reports and corporate governance failures within the Lagos State Office of the Accountant-General were identified as pressing concerns.
Rhodes-Vivour proposed alternative solutions for the Lagos state government, urging them to explore options that would not burden citizens with more debt. He suggested issuing tax credits and incentives to private companies to renovate public schools as part of their corporate social responsibility projects while ensuring compliance with set standards. The formalization of informal tax collection in markets, parks, and local councils was also recommended, with a portion of the proceeds dedicated to the educational sector.
Furthermore, Rhodes-Vivour emphasized that the raised bonds should be allocated towards the improvement of Lagos state’s deteriorating infrastructure, which directly affects the productivity of its citizens. He stressed the importance of transparency and adherence to global best practices in contract bidding, cost management, and implementation for such investments.
