President Buhari has announced a fresh N522 billion bailout to States.
This bailout the President said is to enable the States “pay salaries and pension arrears, and put money in the economy”. The Presidential statement continued…. “the Ministry of Finance is processing the first batch of N153b which will be released to 14 states”….”We have stipulated that at least 50% of the funds should be dedicated to salaries and pensions and will audit disbursements to ensure compliance.
Our Questions
- How is the FGN funding these bailouts? its half year 2016 budget show a fall in federally collectible revenue across board. Imports are also up, putting pressure on the foreign accounts. is this cash simply being printed to pay salaries?
- How will the FGN ensure compliance? Many states like Imo did not transfer the 2015 bailout to States…eg Imo State received N26.81billion, paid N21.02b as “management fees”
- How are the initial 14 states chosen? What criteria was applied?
- for how long will the States be bailed out? this is now an institutionalized moral hazard..
(Photo Credit; BudgIT)
