In view of current financial challenges confronting states, the Kwara State government has designed a model to guarantee payment to contractors handling various projects across the State on quarterly basis and prevent project abandonment through non-payment.
The model, through the Infrastructure Development Fund (IF-K) will provide sustainable funding for continuous infrastructure development through partnership with private sector to close the State’s N225b infrastructure gap.
Explaining the model to Contractors at an interactive Session held at the Government House on Wednesday, the Chief Economic Assistant to Governor Abdulfatah Ahmed, and DG, Kwara PPP Bureau, Mr. Abayomi Ogunsola said the IF-K would give contractors the confidence to borrow money to execute projects knowing fully well that payment is guaranteed and will be paid on stipulated dates.
Mr. Ogunsola explained that capital projects executed under the scheme would be inspected by independent project assessors in order to ensure that contractors comply with the required project standards.
He noted that N300m would be drawn monthly from the State’s internally generated revenue to IF-K to fund projects, assuring that all contractors who key into the scheme would be paid by the Trustee.
Mr. Ogunsola further noted that the partnership between the state government and contractors would lead to massive infrastructural development in the state.
Earlier in his opening remark, the alternate chairman, Alhaji Abdulwahab Babatunde said the government was taking the step to ease the challenges of funding projects in view of the prevailing economic challenges.
He said the scheme will also promote banking and non-banking financial intermediary participation in infrastructure funding, provide incentives and serve as catalyst to mobilizing appropriate private sector capital, efficiency and expertise for the state’s infrastructure projects.
Some of the contractors who spoke at the session while commending the state government for taking the bold step in closing infrastructural gap in the state urged the government to factor in the fluctuating foreign exchange in the partnership.
