The
Federal Government of Nigeria has clarifies that State debt deferrals are not
bail outs, just as creditors will not be adversely impacted, reports ITRealms.
FG through the Federal
Ministry of Finance, said that further to the states debt repayment deferral
for the month of March that was announced last Thursday, the Federal Ministry
of Finance has given clarification.
According to the a press
statement endorsed by the Special Assistant on Media to Honourable Minister of
Finance, Festus Akanbi made this clarification on behalf of his principal, Mrs
Kemi Adeosun, the debt repayments due to the States’ creditors will be fully
paid notwithstanding the deferral.
The Federal Government, the
ministry said, will make the due debt repayments, which would be offset against
liabilities owed to the States, thereby affording all creditors, including
bondholders, not to be adversely impacted.
Further, the Ministry reiterated
that the deferral is not a bail out but rather a responsive measure by the
Federal Government to put States in a better position to meet their salary
obligations.
“The deferral amounts to a
total of N10.9 billion. All states will receive the relief in this
instance, however further deferrals will be subject to the agreement of a
Fiscal Restructuring Plan to be prepared by each state with clear measurable
objectives,” part of the statement read.
The Ministry equally said
its keen to ensure that the programme of Financial Discipline being driven by
the Federal Government is replicated in all tiers of government, including
elimination of payroll fraud and increased spending efficiencies in
overhead.
“Enhanced financial
transparency by the publication of audited accounts and submission of debt
profile may also be required,” the ministry cautioned.
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