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Home » News » N614bn bailout deductions: We are ready to pay — Governors
N614bn bailout deductions: We are ready to pay — Governors
The 36 State Governors under the aegis of Nigeria Governors Forum (NGF) yesterday agreed to pay the N614 billion that was advanced to thirty five states as budget support facility.
Responding to a question after the meeting of the governors ahead of Thursday’s 97th National Economic Council, NEC meeting, Chairman of NGF and Ekiti State governor, Dr. Kayode Fayemi said that as governors they are willing to pay the refund of the bail out fund, stating that it will be done after a proper reconciliation with the federal government, adding that if you owe, you pay.
Fayemi said: “If you borrow, you pay. We are never averse to payment of loans that we took under legal environment and we don’t want a situation that will put our financial and banking system into Jeopardy.
“However, governors believe that we are ready to pay, we also have a duty to ensure reconciliation of account as far as moneys owed to states may be concerned and that is the process that is ongoing.
“It is a storm in a teacup when we read about governors refusing to pay. We don’t have such an issue, we are ready to pay.”
The governors who met yesterday night at the NGF’s Secretariat, Lake Chad, Maitama, Abuja, held such a meeting for the first time after the decision by the Federal Government’s decision to recover the sum of N614 billion advanced to 35 states as budget support facility.
It would be recalled that the Minister Finance, Budget and National Planning, Zainab Ahmed, had at the last NEC meeting, presided over by Vice President Yemi Osinbajo, at the Council Chambers of the Presidential Villa in August disclosed the plans of the Federal government.
Zainab Ahmed had at the Public Consultation Forum on the draft 2020-2022 Medium Term Expenditure Framework in Abuja on September 10th said the deductions will begin in two weeks, which falls on September 27th.
The federal government gave the conditional budget support facility to the states through the Central Bank of Nigeria (CBN) in 2017.
It was to enable the states to meet their financial obligations to civil servants and pensioners. The money was provided at a nine per cent interest rate, with a grace period of two years.
Ahmed had said the repayment will be taken from the affected states’ allocations during the next Federation Accounts Allocation Committee (FAAC) meeting this month.
According to her, the refund was not going to be treated as revenue to be used to fund the 2020 budget, adding, “It was a loan that was advanced by the Central Bank of Nigeria to the states.”
Ahmed who further explained that because the payment was made by the CBN, the recovery process is for the loans to be deducted from the FAAC allocations of the states and remitted back to the CBN, adding that the process will not require a consideration of the fiscal strategy paper (FSP) implementation, but to ensure the states stayed on the path of fiscal sustainability.
The minister had said that, “This will not be a condition for the deduction. We will deduct direct at source and remit to the CBN “
Reading a communique after the meeting, the NGF Chairman said that the body was briefed by the Inspector General of Police, IGP on the unlawful invasion of some governors’ residences in direct violation of the immunity of the Executives.
The Communique read, “We the members of the Nigeria Governors’ Forum (NGF), at our meeting held today at the NGF Secretariat Abuja,
deliberated on several issues and resolved as follows:
” The Forum was briefed by the chairman Governor Kayode Fayemi Governor of Ekiti State on the meeting between the Forum and the President first, and later the Inspector General of Police on the unlawful invasion of some governors’ residences, in direct violation of the immunity of the Governors.
“The Forum was briefed by the chairman on the meeting between the Forum and The Nigerian Union of Journalist (NUJ), the governors’ pledged to continue to collaborate with journalist, especially around the issues of security particularly when they work in hostile environments.
“The Forum received a briefing on the status of the world bank assisted State Fiscal Transparency, Accountability and Sustainability Program for results (SFTAS), the team from the World Bank assured the Forum that all assessments now inply that States have improved in transparency ratings over the last quarter.
“The Forum also received, in session, the new Country Director of the World Bank, Shubham Chaudhuri whose tour of duty commences on 1st October 2019. He replaces Ben Masoud after his four (4) year tenure in Nigeria.
“The Forum received a presentation from Nigeria Meteorological Agency (NIMET) advising that the country should expect above-average rainfall which has already resulted in severe flooding in several States.
“The Forum listened to a presentation by the Transmission Company of Nigeria (TCN), which highlighted the issues around inadequate transmission and sought governors’ commitment to improving the power situation in the country. The Forum resolved to partner TCN to improve power supply nationwide.”
At the meeting were Godwin Obaseki of Edo State, Rotimi Akeredolu of Ondo State, Kayode Fayemi of Ekiti State, Babatunde Sanwo-Olu (Lagos), Aminu Tambuwal of Sokoto State, Samuel Ortom (Benue), Bala Mohammed (Bauchi), Seriake Dickson (Bayela), Abubakar Badaru, (Jigawa), Ifeanyi Okowa (Delta), Emeka Ihedioha (Imo), Seyi Makinde (Oyo), Dapo Abiodun (Ogun), Aminu Masari (Katsina) and Bello Matawalle (Zamfara), among others
The Deputy Governors in attendance are Nasarawa and Kaduna.
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