The Oyo State House of Assembly has defended its approval of a ₦100 billion loan facility for Governor Seyi Makinde’s administration, arguing that the borrowing will provide additional funding for infrastructure projects and other development priorities across the state.
The Assembly dismissed criticism of the decision, describing objections to the loan as a product of ignorance and political mischief.
The facility, to be obtained from United Bank for Africa (UBA) Plc, was approved following a request by the state government for additional financing to support ongoing projects and accelerate the delivery of critical infrastructure.
The lawmakers also explained that a separate ₦300 billion facility was intended to refinance an existing contractors’ finance arrangement obtained from Access Bank.
The two facilities serve different purposes: the ₦100 billion loan represents fresh borrowing for development projects, while the ₦300 billion arrangement concerns the refinancing of an existing obligation.
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The Assembly’s defence comes amid wider debate over the use of loans by state governments to finance capital projects and manage existing financial commitments.
Supporters of infrastructure borrowing argue that it can help governments complete major projects that might otherwise be delayed by limited revenue. However, critics often raise concerns about debt sustainability, repayment obligations and the long-term implications for public finances.
For Oyo State, the key questions will include how the new funding is deployed, whether the projects deliver measurable public benefits and how the repayment commitments affect future budgets.
The controversy has also acquired a political dimension, with opposition figures questioning the Makinde administration’s borrowing decisions.
The state government and lawmakers will face continued scrutiny over transparency, project implementation and the financial terms attached to the facilities.