The Enugu State House of Assembly, on Tuesday, approved a N14.2 billion Naira loan request by Governor Ifeanyi Ugwuanyi to enable the government offset outstanding salaries and pensions.
The loans will also enable the government embark on development and infrastructural projects.
A breakdown of the loan includes the sum of N4,207,000,000 for the arrears of salaries and pensions and N10 billion for development and infrastructural projects.
The motion on notice was presented to the House by Hon. Ikechukwu Ezeugwu, leader representing Udenu Constituency.
While passing the resolution, the house said, “That this Honourable House do resolve to authorise the State Government to obtain loans of N4,207,000,000 (four billion two hundred and seven million naira) and N10,000,000,000 (ten billion naira) only, respectively from Central Bank of Nigeria (CBN) to liquidate arrears of salaries (subventions) and pensions and for development of infrastructural projects to be secured by excess crude account (ECA).
“The loans carries a single digit interest rate of 9 per cent and tenure of 20 years repayment period, and it is cheap and convenient.
“Enugu State had earlier applied for the restructuring of its Commercial Bank loan of N6,413,942,870.84 as at June, 2015 and when this is approved, the monthly repayment will be reduced as the tenure of the loans will be extended over 20 years, thereby leaving reasonable balance monthly for the state to operate, and as such, the repayment of this bailout can still be accommodated,” the House stated.
The resolution was reached in compliance with the outcome of the National Economic Council (NEC) meeting of June 2015, that authorised CBN to create a pool of loanable funds up to a maximum of N10 billion for any interested state to access.