Paris Club Refund: States Get N243.7BN

• Paris Club Refund: States Get N243.7BN

The Federal Government has released N243.79bn as the second tranche of Paris Club Refund to the 36 state governments and the Federal Capital Territory.

The Director of Information in the Federal Ministry of Finance, Mr. Salisu Dambatta, confirmed the release in a statement issued on Tuesday night.

With the fresh release of the second tranche of N243.79bn, the amount so far disbursed to states as refund under the Paris Club loan is now N760.17bn.

He said the approval for the payments was done on May 4 by President Muhammadu Buhari in partial settlement of long-standing claims by state governments relating to over-deduction from their allocations from the Federation Account for external debts service arising between 1995 and 2002.

A breakdown of the N243.79bn showed that five states received the highest amount of N10bn each.

The states are Akwa Ibom, Bayelsa, Delta, Kano, and Rivers.

The total amount of N50bn received by these five states represents 20.5 per cent of the entire amount released under the second tranche.

Interestingly, these five states also got the highest chunk of N135.09bn when the first tranche of N516.38bn was released by the government in December last year.

Further analysis of the payment schedule showed that Lagos received N8.37bn; Katsina, N8.2bn; Oyo, N7.9bn; Kaduna, N7.72bn; Borno, N7.34bn; and Niger N7.21bn.

Abia got N5.71bn, Adamawa, N6.11bn; Anambra, N6.12bn; Bauchi, N6.87bn; Benue, N6.85bn; Cross River, N6.07bn; Ebonyi, N4.51bn; Edo N6.09bn; and Ekiti N4.77bn.

In the same vein, the disbursement schedule showed that Enugu received N5.36bn; Gombe, N4.47bn; Imo, N7bn;Jigawa, N7.1bn; Kebbi, N5.97bn; Kogi, N6.02bn; Kwara N5.12bn; Nasarawa, N4.55bn; Ogun , N5.73bn; Ondo, N7bn; and Osun, N6.31bn

Others are Plateau, N5.64bn; Sokoto, N6.44bn; Taraba, N5.61bn; Yobe N5.41bn; Zamfara, N5.44bn; and Federal Capital Territory N684.86m.

The statement reads in part, “These payments which totalled N243, 795,465,195.20 were made to the 36 states and the Federal Capital Territory upon the approval of the President on May 4, 2017, in partial settlement of long-standing claims by state governments relating to over-deductions from their Federation Account Allocation Committee allocation for external debt service arising between 1995 and 2002.

“The Minister of Finance, Mrs. Kemi Adeosun explained that these debt service deductions were in respect of the Paris Club, London Club and Multilateral debts of the FG and states. While Nigeria reached a final agreement for debt relief with the Paris Club in October 2005, some states had already been overcharged.”

The funds, according to the statement, were released to the state governments as part of the wider efforts to stimulate the economy.

It added that the funds were specifically designed to support states in meeting salary and other obligations, thereby alleviating the challenges faced by workers.

The ministry said the releases were predicated on the condition that a minimum of 75 per cent of the money would be used for the payment of workers’ salaries and pensions.

It added, “The Federal Ministry of Finance is reviewing the impact of these releases on the level of arrears owed by state governments.

“A detailed report is being compiled for presentation to the Acting President, Prof. Yemi Osinbajo, as part of the process for approval for the release of any subsequent tranches.

The Osun State Government, in a statement on Tuesday confirmed that it had received N6.314bn as the second tranche of the refund.

The state government, in the statement by the Director of Bureau of Communication and Strategy, Office of the Governor, Semiu Okanlawon, said the money was paid into the account of the state on Monday.

On its part, the Benue State Government said it received N6.4bn.

The Acting governor of Benue State, Mr. Benson Abounu, announced this on Tuesday in Makurdi, while briefing journalists at end of the state executive council meeting presided by him at the Government House.

Abounu stated that the money would be substantially utilised for salary payment after one or two processes would have been completed.

“I wish to inform you that we expected over N12bn as second tranche of the refund, but only half of the amount was released by the Federal Government due to paucity of funds,’’ Abounu stated.

The Ogun State Government also said it received N5.7bn as second tranche of the refund.

According to a statement by the state Commissioner of Finance, Wale Osinowo, the state Governor, Ibikunle Amosun, had approved N4.5bn for the payment of cooperative deductions arrears to all categories of workers in the state.

Oshinowo said N3.4bn had been disbursed for the payment of six months’ arrears of outstanding cooperative deductions to all categories of the workforce at the state level.

He stated that another N1.1bn was disbursed for the payment of three months of outstanding cooperative deductions to workers at the local government level.

He said another sum of N1.2bn would be expended on state expenditure.

The finance commissioner said the money came from the N5.7bn the state received from the Paris Club refund.

“Ogun State is apportioning 79 per cent to staff welfare and only 21 per cent on state expenditure, aside the fact that the state government, in its usual practice, has paid June 2017 salary to all categories of workers at both the state and local government levels,” Oshinowo added.