The Federal Government has given approval for the release of N656.1bn to states in a bid to cushion the negative impact of the deduction of bailout facility on the revenue of state governments.
Already, approval of President Muhammadu Buhari has been received to disburse the amount to the state governments over a period of six months.
The Minister of Finance, Budget and National Planning, Mr. Zainab Ahmed who confirmed this said the N656.1bn will enable states to meet their salary and other obligations. She spoke at the National Council on finance and Economic Development (NACOFED) conference held in Lagos.
She explained: “The approval of Mr. President has been obtained for a bridging facility in the sum of N656.1bn to be granted to states over a period of six months towards cushioning the effects of their resumption in the repayment of the three federal government bailout facilities (Salary Bailout, Excess Crude facility and Budget Support facility)
“Already, the modalities of the facility has been worked out and the disbursement is expected to commence by the CBN very soon. “Government will also continue to provide other financing options to states in the form of concessionary loan facilities to support the development of vital sectors of the economy such as health, agriculture and SMEs aimed to complement the states in fighting the pandemic, creating the needed job for the people and alleviating poverty. “The combined effect of these policies would assist in addressing the current security and other socio-economic challenges confronting the nation.” She also disclosed that the World Bank has approved an additional $750m financing to support the States’ Fiscal Transparency, Accountability and Sustainability (SFTAS) programme. SFTAS is a $750m programme to reward States for meeting any or all of nine indicators that demonstrate improvements in fiscal transparency, accountability and sustainability.