President Muhammadu Buhari has approved a comprehensive relief package for states who are near bankrupt that could not pay workers’ wages.
It was gathered that the President approved a three-pronged relief package including sharing of fresh allocations, granting of soft loans and restructuring of states’ debt-servicing payments.
The packages are expected to go into effect this week as the President is said to have directed that release of the funds should be made urgently to assuage the plight of thousands of Nigerian workers in the federal and state governments.
According to findings, about $2.1b (N413.7bn) will be shared in fresh allocation between the states and the federal government. The money is sourced from recent Liquefied Natural Gas (LNG) proceeds to the federation account.
A Central Bank of Nigeria (CBN)-packaged special intervention fund that will offer financing to the states, ranging from between N250bn and N300bn. This would be a soft loan that states could access to pay the backlog of salaries.
Implementing a debt relief programme proposed by the Debt Management Office, DMO, which will help states restructure their commercial loans currently put at more than N660bn, and extend the life span of such loans while reducing their debt-servicing expenditures.
Also, a total of N391 billion from the Excess Crude Account, ECA, will be shared among the three tiers of government, the Accountant-General of the Federation, Ahmed Idris, disclosed yesterday.
With the N413.7 billion LNG proceeds it means the three tiers of government will share a total of N804.7 billion.
By extending the commercial loans of the states, according to the third package, more funds would be made available to the state governments, which otherwise would have been claimed at source by the banks.
