The financial assistance provided by the federal government to the states as a response to alleviate the impact of the removal of the petrol subsidy is, according to TheCable’s report, in the form of a loan.
Earlier, the federal government had announced a relief package of N5 billion for each state in the federation, as well as the federal capital territory (FCT).
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Governor Babagana Zulum of Borno state disclosed during the conclusion of the national economic council (NEC) meeting, led by Vice President Kashim Shettima, that this palliative would enable state governments to acquire 100,000 bags of rice, 40,000 bags of maize, and fertilizers. This is intended to mitigate the repercussions of food scarcity across the country.
However, in a memo to governors entitled “Re: Distribution of Palliatives – Terms of FG Facility”, Asishana Okauru, director-general of Nigeria Governors Forum (NGF), said states might opt out of the offer and return a sum of N2 billion already given to them.
“I have been directed by the Chairman, H.E. AbdulRahman AbdulRazaq to forward the terms of the facility as follows,” Okauru said in the memo.
“Facility size: N4,000,000,000.00
Loan (48%): N1,920,000,000.00
FGN Grant: (52%)
N2,080,000,000.00 Beneficiary each state government
Tenure: 20 months
Interest Rate: Nil
Moratorium: Three months
Repayment Mode: Monthly
Repayment Amount: N120,000,000.00
Security Irrevocable Standing Payment Order (ISPO)
“Your excellency is invited to note that this offer is optional and states that do not wish to participate may opt-out and refund the N2 billion already disbursed to them.”
