Federal Government moves to recover N614bn bailout from 35 governors

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Though  time seem  ahead for governors as Federal Government has announced plans to recover the sum of N614 billion budget support facility advanced to 35 states.

Minister of Finance, Budget and National Planning, Zainab Ahmed, made the disclosure at a press briefing at the end of the National Economic Council (NEC) meeting, presided over by Vice President Yemi Osinbajo, at the Council Chambers of the Presidential Villa.

Although she was not definite on when the recovery would begin, a relaible source told Daily Sun that the exercise would “begin sooner than later”

Ahmed said each of the affected 35 states received N17.5 billion as bail out.

She said NEC has agreed to constitute a team to finalise modalities for commencement of repayment of the loan facility.

The team, according to her, would be constituted from the Nigerian Governors Forum (NGF) to meet with the Central Bank of Nigeria (CBN) and Ministry of Finance

Prof. Osinbajo had disclosed that the Muhammadu Buhari administration has in the past three years, intervened through loans, bailouts and Paris Club refunds to states to the tune of over N1.1 trillion.

He had urged the governors, at a retreat for the newly elected governors, to think outside the box to boost their states Internally Generated Revenue (IGR) to enable them meet the demands of the N30,000 new minimum wage among others.

Briefing State House Correspondents at the end of the 96th NEC meeting and the fourth for the year 2019, yesterday, the minister said her ministry reported to council an update on the budget support facility to states.

“As at today, the budget support facility advanced by the Federal Government to the states is a total sum of N614 billion and this is to 35 states. This means an equivalent is N17.5 billion per state.

“Council agreed to constitute a team of the Nigeria Governors Forum (NGF), Ministry of Finance and the Central Bank of Nigeria (CBN), to finalise modalities to commence repayment of these facility to the Central Bank.”

She said macro-economic stability has been achieved with growth in end Q3 2019 at 3.01 per cent, even as real GDP continues to increase from 1.89 per cent in Q2018 to 2.01 per cent in 2019.

The minister said there has been significant growth in non-oil sector, with contributions to GDP increasing from 90.4% in Q1 2018 to 90.9 per cent in Q1 2019.

Ahmed called for policies that will promote diversification and inclusive growth as well as check unemployment, currently standing at 20.1 per cent as at Q3 2018.

“Inflation has continually decline since 2017 from 18.72 per cent to 11.08 per cent in July 2019, draft 2020 – 2022 Medium Term Fiscal framework indicates that Nigeria faces significant medium term fiscal challenges, especially with respect to revenue generation.

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