Reuben Abati
The monthly Federation Accounts Allocation Committee, FAAC, meeting was held the other day in Abuja, with the representatives of state governments again cap in hand, asking for their share of federal revenue – read: oil revenue, or better still, national cake, or our money.
A paragraph in the report by the online newspaper, Premium Times, caught my attention and here it is: “But at the Federation Accounts Allocation Committee, FAAC, meeting, representatives of the 36 state governments went home SAD (emphasis mine), as they were handed parlous shares from a total N299.75 billion statutory allocation for the month, the lowest allocations in more than five years.” For the month of March 2016, the states shared N55.34 billion, compared to N64.52 billion in February 2016. I have deliberately emphasized the word sad,because the day may well come when after the sharing of national revenue, we may be told that some Commissioners of Finance left the meeting crying, or wailing.
To prevent that happening this time, the Federal Government chose to suspend deductions of salary repayment loans owed by the states. When such deductions were made in February 2016, at least one state, Osun, went back home with a paltry N6 million only. The truth is that most of the 36 states are in dire straits, worst hit by the economic crisis that the country faces. About 27 out of the 36 states of the Federation are effectively insolvent, if not bankrupt. In July 2015, the Federal Government not only bailed out the states financially, the Central Bank of Nigeria further extended the repayment period for bank loans taken by the states from a period of seven years to 20 years. So far the affected states have collected salary assistance loans from the CBN to the tune of N689.5 billion, with an …Read More
Source:: PM Newspaper
