States of the federation have started benefiting from the Special
Intervention Fund aspect of the presidential relief package earlier
approved by President Muhammadu Buhari.
This was disclosed today at the National Economic Council, NEC, meeting
held at the State House presided over by Vice President Prof Yemi
Osinbajo, SAN.
While briefing the Council, the Central Bank Governor, Mr. Godwin Emefiele
said 18 states had been able to draw from the Fund, as at today, while a
number of other states are currently being processed for the soft loan
facility. This is part of President Buhari’s relief package designed to
help states pay backlog of salaries and also ease their financial
challenges caused by the drop in federal allocation.
In a similar vein, the Director-General of the Debt Management Office,
DMO, Mr. Abraham Nwankwo also informed the NEC that the second phase of
the debt restructuring offered to the states is now in effect with 13 new
states now being considered, with 12 banks involved.
This is in addition to 11 states whose debts were restructured last month,
according to Nwankwo who also told the Council 23 states are now involved
in the restructuring. While a total of over N322 Billion of states loans
were restructured last month, about N252 Billion have been restructured
this month.
It would be recalled that the presidential relief package has three core
elements. These are:
*The sharing of about $2.1B in fresh allocation between the states and the
federal government. The money was sourced from recent LNG proceeds to the
federation account, and its release okayed by the president leading to the
sharing of federal allocation twice for month of June.
* A Central Bank-packaged special intervention fund that will offer
financing to the states, to the range of about ranging around from N300B.
This is a soft loan available to states to access for the purposes of
paying backlog of salaries.
*A debt relief program designed by the Debt Management Office, DMO, which
is now helping the states restructure their commercial loans put at over
N660B, and extend the life span of such loans while reducing their
debt-servicing expenditures.
Today, the NEC also received an ongoing report from its Ad-Hoc Committee
of five governors on the management of the Excess Crude Account and
related Federation Account issues. The Committee briefed the Council that
it has observed a lack of transparency and accountability in the operation
of the Federation Account, adding that there were no checks and balances
in the running of the ECA in the recent past.
The five governors on the Ad-Hoc Committee are the Edo State Governor,
Comrade Adams Oshiomhole; Gombe State Governor, Alhaji Ibrahim Dankwambo;
Kaduna State Governor, Mallam El Rufai; (who presented the report to
Council today) Akwa Ibom State Governor, Mr. Emmanuel Udom and Lagos State
Governor, Mr. Akinwunmi Ambode.
The Council also received a report on the issue of refund requested by
states who repaired federal roads under the past administration. A
briefing by both the Federal Ministry of Works and the office of the
Accountant-General of the Federation disclosed that 13 states have fully
complied with the reimbursement requirements, 8 states partially complied
and 21 states with no compliance with federal reimbursement requirements.
The Buhari administration will be exploring options to address the problem.
The Federal Ministry of Agriculture also briefed the Council on its policy
direction so far. The Council which meets monthly was attended by state
governors and several top officials from the federal and state
governments.