N300bn bail out: States to begin drawdown soon –Presidency From Juliana Taiwo-Obalony

The Presidency has said states are to start drawing from the special intervention fund of between N250 billion and N300 billion in a matter of weeks.
This, it said, was part of the three-pronged financial intervention of President Muhammadu Buhari to assuage workers’ plight and support the states in distress.
The Senior Special Assistant to the Vice President on Media and Publicity, Laolu Akande, in a statement disclosed that meetings were ongoing between the Federation Account Allocation Committee, (FAAC) and the Central Bank of Nigeria (CBN) on the one hand, and between CBN and commercial banks on the other hand, regarding details of the special intervention fund and the debt relief programme of the President for the states.
He said the meetings were reviewing loan profiles of the states, issues around restructuring of existing loans including time span and reconciling the figures.
“Already, it has been agreed that existing state loans be restructured for 20 years, and regarding the bond option, the rates to be applied would be market-based but with a cap to make it affordable. Within weeks from now, the states are expected to start benefiting from these two other parts of the presidential intervention fund.”
The details of the presidential intervention are in three parts including the sharing of about Liquified Natural Gas (LNG) $2.1 billion funds, the CBN’s N250 to N300 billion soft loans to states and a debt relief programme by the CBN and Debt Management Office (DMO), to extend state loans by 20 years.
“By extending the commercial loans of the states, the third part of the presidential intervention would therefore make available more funds to the state governments, which otherwise would have been removed at source by the banks.
“To be able to offer this option to the states, President Muhammadu Buhari had brought the financial muscle of the Federal Government to bear on behalf of the states, guaranteeing the elongation of the loans.
“Besides, the availability of the $2.1 billion from LNG, which has now been shared to the states was made possible because President Buhari had set a new fiscal standard and tone that all monies generated should go to the federation accounts. Before that constitutional standard was upheld by the President, LNG dividends were going to other NNPC designated accounts.
“To date, the states have now drawn from the LNG taxes and dividends totalling $2.1 billion besides a second sharing from the federation account, which is the regular monthly allocations of over N518 billion last week,” he said.
Akande reiterated National Economic Council (NEC)’s advise to state governors to henceforth make the payment of salaries a first-line charge, do more to increase their internally generated revenue, clean up their payroll to eliminate ghost workers and have  fully functional DMO.
Culled from The Sun