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₦614 Billion Bailout: FG Begins Deducting From States’ Allocations

UofA Lodge – uniabuja portal, news and general news, JAMB, POST-UTME, admissions Forums Politics ₦614 Billion Bailout: FG Begins Deducting From States’ Allocations

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    • The federal government has commenced the deduction of the N614 billionbailout it gave to the 35 states of the federation, the Minister of Finance, Budget and National Planning, Zainab Ahmed, said on Thursday in Abuja.
      The minister, who spoke to journalists at the second National Economic Council (NEC) meeting in 2020, said the deductions were made from the statutory allocations to the affected states in January and February during the Federation Accounts Allocation Committee (FAAC) meetings.

      The federal government extended the conditional budget support facility to the 35 states through the Central Bank of Nigeria (CBN) in 2017 to help them pay their workers’ salary and settle their pension obligations.

      The loans were granted to the states at a nine per cent interest rate, with a two years grace period to repay.

      However, last year when the Federal Government announced the repayment schedule, the governors gave conditions for the repayment of the loans.

      The Chairman of the Nigerian Governors’ Forum, Kayode Fayemi, said the governors demanded a reconciliation of accounts between the federal and state governments before repaying the bailout fund granted them.

      The reconciliation, the governors argued, would allow the states to deduct the debts the federal government owed states as a result of the repair of federal roads undertaken by the state governments in their domains.

      The repayment of the loans originally scheduled to commence last September did not happen until after the reconciliation exercise was concluded last December.

      Mrs Ahmed, who said the repayment of the loan was not to be treated as revenues to fund the 2020 budget, explained it would be taken from the affected states’ allocations from the Federation Accounts.

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