Bukola Saraki Elected Senate President

Amidst the massive declines in cash-flow of the various tiers of government due to dwindling oil revenue, there were indications that the Senate may block state governments from accessing the USD4.25 billion earmarked by the World Bank for states’ development. A source close to the Senate Committee on Foreign and Domestic Debts, hinted to Newsmen that the states would still need to seek the Senate approval to access the funds, adding that the Senate will weigh the merits in the light of the existing loan exposures of the states. He added that the states were already highly geared, meaning that they have over-borrowed and are now in a repayment difficulties. As at end last year total states’ domestic debts was about N1.66 trillion with another substantial share of Nigeria’s total external debt of USD10.7 billion. These are in addition to federal government and Central Bank of Nigeria’s backed N560 billion restructured loans for the states last year, which were rolled over again this year due to the states’ inability to meet up with repayment plans. Several states are said to have mortgaged their monthly allocation from the Federation Account Allocation Committee, FAAC, resources to irrevocable standing payment orders that clears between 50 per cent and 90 per cent of the allocations into their contractors’ bank accounts, leaving the affected states with too little a resources that cannot pay basic salaries. Hence, over 17 states are now owing salary arrears with some up to 10 months as at end April 2016. In a session with the Nigerian Governors’ Forum, NGF, the Country Director of World Bank, Rachid Benmessaoud,  had educated the governors on how they could access the funds. The chairman of the forum, Governor Abdulaziz Yari of Zamfara State, told journalists that the forum decided to invite  the World Bank to brief them “on the money lying down in the World Bank which largely belongs to state governments but had not been accessed”. Mr. Yari said because of the cumbersome procedure in accessing the funds, most of the governors did not even know they had such funds there. He said: “Because of the cumbersome procedure in accessing these funds, most of the governors did not even know they had such funds there. It was the initiative of the Governor of Kaduna State that they should come and make this presentation so that they can educate the governors to know that these monies are there especially in the kind of situation we are so that the states can move forward in terms of infrastructure development and other matters in our respective states. “

Source: Vanguard Newspaper

 

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