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Cashing in on Fiscal Responsibility: FRC Warns Against Misapplication of Borrowing Proceeds

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Cashing in on Fiscal Responsibility: FRC Warns Against Misapplication of Borrowing Proceeds....KINDLY READ THE FULL STORY HERE▶

The Fiscal Responsibility Commission (FRC) has issued a stern warning regarding the misapplication of borrowing proceeds, highlighting the urgent need for greater fiscal discipline among government entities. This crucial message was conveyed by Victor Muruako, the Executive Chairman of the FRC, during the National Summit of Fiscal Responsibility Agencies in Nigeria, held on Thursday at the NAF Conference Center in Abuja.

Muruako underscored the importance of utilizing borrowing proceeds solely for long-term capital expenditures, as stipulated in Section 44(2)(b) of the Fiscal Responsibility Act. He stated, “The proceeds of public sector borrowing shall solely be applied towards long-term capital expenditures.” This directive aims to prevent the frequent violations observed across various levels of government, which undermine fiscal integrity.

The FRC chairman expressed particular concern over the lack of adherence to the borrowing conditions outlined in the Fiscal Responsibility Act, especially by subnational governments. He remarked, “We do not see sufficient adherence by subnational governments to the conditions for borrowing.” Muruako emphasized that both state governments and lending institutions must operate within these guidelines to maintain fiscal discipline and ensure that national debt remains manageable.

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In his address, Muruako also addressed issues of inadequate fiscal coordination, particularly in the areas of debt management and procurement practices, which significantly affect Nigeria’s overall debt profile. He cited a recent failed partnership between a Chinese firm and a subnational government, highlighting the critical lessons regarding the link between subnational debt and national economic stability. “A state government’s judgment debts constitute part of the debts of that state government and, by extension, part of the total stock of national debt,” he explained.

Another pressing concern raised by Muruako was the lack of proper documentation and cost-benefit analysis by governments seeking to borrow funds. He pointed out that Section 44(1) of the Fiscal Responsibility Act mandates that any government or its agencies wishing to borrow must specify the purpose of the borrowing and present a detailed cost-benefit analysis. “This is generally observed in the breach. And it shouldn’t be so,” he lamented.

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Muruako criticized certain state governments and financial institutions for circumventing the provisions of the Fiscal Responsibility Act through false declarations of compliance. He stated, “We have seen unacceptable variances, such as a State’s Fiscal Responsibility Commission overreaching itself to declare a loan application by its state government as fulfilling the requirements of the Fiscal Responsibility Act.” Such actions, he noted, are avoidable usurpations of the powers and responsibilities of the FRC.

Muruako urged state governments to align their borrowing practices with the conditions set out in the Fiscal Responsibility Act. He also emphasized the importance of professionalism in managing public-private partnerships (PPPs), warning that these can carry fiscal risks. “Though PPPs are not public borrowings per se, they can morph into contingent liabilities and public debts,” he cautioned.

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Don’t Burn Tyres On New Roads — FERMA Begs Abia Residents.

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The Federal Road Maintenance Agency (FERMA) has appealed to residents of Abia State and other road users along the Aba–Azumini highway to protect the newly completed road from activities that could damage it.....KINDLY READ THE FULL STORY HERE▶

FERMA’s South-East 2 Zonal Director, Suleiman Mohammed Omonowo, issued the warning during an inspection of the project, cautioning against the burning of tyres during celebrations, which he said could damage the road surface.

He noted that destructive practices by some youths and community members often contribute to the early failure of road projects across the country.

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“Our advice to road users, especially indigenes, is to protect the road from destruction. Let nobody come and destroy it or burn tyres in the name of celebration,” he said.

Omonowo said the Aba–Azumini highway was previously in a very bad condition before FERMA intervened, describing it as a death trap for commuters and residents.

He also expressed satisfaction with the quality of work done on the project, adding that drainage structures such as catch pits would help prevent flooding and extend the lifespan of the road.

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According to him, the highway serves as a major link between Aba, several Abia communities, and Cross River State, carrying heavy traffic daily.

He urged local construction firms to improve on quality delivery to compete effectively with foreign contractors.

Meanwhile, the Federal Roads Maintenance Engineer in Abia State, Festus Okafor, said FERMA workers have not faced harassment or violence from residents during operations in the state.

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Correctional Service Declares Escaped Yobe Inmate Wanted Nationwide.

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The Nigerian Correctional Service (NCS), Yobe State Command, has declared a 30-year-old inmate wanted after he escaped following a road accident involving a prison transport vehicle.....KINDLY READ THE FULL STORY HERE▶

The incident reportedly occurred on April 13, 2026, while inmates were being conveyed from the Medium Security Custodial Centre in Potiskum to Damaturu.

In a statement issued in Damaturu, the Command’s Public Relations Officer, DSC Abdullahi Adamu, said the vehicle conveying the inmates was involved in a crash during the journey.

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He said the accident happened while efforts were ongoing to rescue those affected.

The escaped inmate was identified as Dahiru Mohammed, with prison number J/1539/24, who was admitted into custody on November 29, 2024.

The Correctional Service described him as dangerous and warned members of the public not to have any form of contact with him.

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It urged residents to report any useful information that could lead to his re-arrest to the nearest security agency.

Authorities also cautioned that harbouring a fugitive is a criminal offence punishable under the law.

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Court Orders UI To Reinstate Students Suspended Over Fee Hike Protest.

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The Federal High Court sitting in Ibadan, Oyo State, has ordered the University of Ibadan (UI) to reinstate three students suspended over their participation in a protest against tuition fee hikes.....KINDLY READ THE FULL STORY HERE▶

Delivering judgment on Wednesday, Justice Nkeonye Maha set aside the decision of the university’s Central Student Disciplinary Committee, ruling that the students were denied fair hearing during the disciplinary process.

The court held that the failure to allow the students call witnesses and present evidence violated their constitutional right to fair hearing, rendering the sanctions against them invalid.

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The affected students — Aduwo Ayodele, Mide Gbadegesin, and Nice Linus — were suspended on July 14, 2025, after taking part in a protest against increased school fees approved by the university’s governing council.

Dissatisfied with the suspension, they approached the court, arguing that the disciplinary proceedings breached their fundamental rights and due process.

They asked the court to quash the suspension, reinstate their studentship, and award damages for alleged rights violations.

In her ruling, Justice Maha agreed with their arguments, stating that the university’s actions failed to meet the standards of natural justice.

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Following the judgment, rights group CAPPA hailed the decision, urging the university to comply fully, reinstate the students, and issue an apology.

The group said the ruling reinforces constitutional protections for freedom of expression and serves as a warning against the suppression of student protests in tertiary institutions.

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