Only 5 states meet FG’s N90bn bailout conditions

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Excess Crude Account now $2.261bn
By Abdullahi M. Gulloma
Abuja
The pathetic conditions of workers across some states, does not appear to have an end for now, as only five of the 36 states met the terms set out by the federal government to access the N90billion bailout.
Most of the states are broke and could not pay workers salaries and also fund key services or execute development projects.
Before the new N90 billion lifeline, the Central Bank of Nigeria, had in July 2015 put together and splashed a special intervention fund to the tune of between N250 to N300 billion in the form of soft loans, on states, to enable them pay salary backlogs.
Besides, the second tier of government also enjoyed a debt relief programme from the Debt Management Office (DMO), used in restructuring their commercial loans of over N660 billion, by extending the loans life span, while reducing the states’ debt-servicing expenditures.
All these could still not bail out the states whose economic fortunes keep nose diving, hence the latest bailout which the federal government planned to release based on some conditions, which include compliance with the centralised Treasury Single Account in each state.
Others include; states must publish audited annual financial statements within 9 months of financial year end; introduction and compliance with the International Public Sector Accounting Standards (IPSAS); publish State budget online annually, and publish budget implementation performance report online quarterly.
The states, should also develop standard IPSAS compliant software to be offered to states for use by state and local governments, set realistic and achievable targets to improve independently generated revenue (from all revenue generating activities of the State in addition to tax collections) and ratio of capital to recurrent expenditure, and also show quarterly financial reconciliation meetings between Federal and State Governments to cover VAT, PAYE remittances, refunds on Government projects, Paris Club and other accounts, among other conditions.
Giving an update on the level of compliance yesterday, the National Economic Council (NEC) said so far, only five states met the conditions.
Announcing this shortly after the meeting at the State House, Abuja, Governor Udom Emmanuel of Akwa Ibom state, said only one state declined to access the bailout.
“It doesn’t actually mean that states which will take this money do not have something accruable also from the federal government. Pending the time we reconcile our book, the federal government may have some balances to settle state governments. In the meantime, can we open up the window so we can have access to liquidity and implement our 2016 budget? I think that is the whole idea.
“It is just to make this available. It is not compulsory. What is important is; can people have access to a lifeline?
“You see what is happening today is not peculiar to Nigeria as a country.
You know the impact of the fall in crude oil price that has actually gotten to oil producing countries like Nigeria. What we are looking at is the solution; we must provide a lifeline for people to survive and to move on. I don’t think it’s too much,” he said.
In her remarks, Minister of Finance, Mrs. Kemi Adeosun, said the NEC was also briefed on the Excess Crude Account (ECA), which has a balance of $2,261 billion as at June 15, 2016.