Economy

CBN To Begin Deduction Of N614bn Budget Support Facility This Month

  The Federal Government, on Thursday, said deductions of the Federal Government’s N614bn Budget Support Facility from the accounts of 35 beneficiary State governments will now begin this month.

Minister of Finance, Budget, and National Planning, Mrs. Zainab Ahmed, who announced this during the National Economic Council’s 118th meeting, noted that it is in line with the agreement reached on the matter with the Central Bank of Nigeria (CBN), which provided the bridge financing facility.

The meeting, which was held virtually, was presided over by Vice President Yemi Osinbajo and attended by the State governors, federal ministers, the CBN Governor, and other senior government officials in attendance, according to a statement by Laolu Akande, Senior Special Assistant to the President on Media & Publicity, Office of the Vice President.

Investdata recalls that deductions of the facility were to have commenced in May, after being suspended for one year to enable the states to stabilize their finances, following the outbreak of the novel Coronavirus pandemic, as well as the lockdown imposed across the country and globally with the attendant effect on oil production and sale.

At the meeting in April, when plans to begin the deductions were announced by the Finance Minister, the governors had appealed for a further extension, following which Vice President Yemi Osinbajo, as chairman called for an all-parties meeting on the matter. The follow-up meeting was called after Godwin Emefiele, the CBN governor “explained the technical challenges involved, should there be a further postponement of the deductions.”

The meeting was chaired by Osinbajo and attended by Mrs. Ahmed, and Emefiele, while the state governors were represented by Governor Kayode Fayemi of Ekiti State, and chairman of the Nigerian Governors’ Forum to properly consider the issue and reach a decision.

The Federal Government started distributing the facility in June 2017.

Also at the July meeting, Akande said “the council received and discussed the initial report of its Ad-Hoc Committee interfacing with the Nigeria National Petroleum Corporation (NNPC) on the complete deregulation of the downstream sub-sector of the industry, and appropriate pricing of Premium Motor Spirit (PMS).

“Observations and comments were made and it was resolved that an updated version will be submitted by the Committee inclusive of observations raised at (the) meeting and then an updated report be made to the National Economic Council (NEC) for further action.”

This resolution, he continued, “comes even as the Council noted that the Federal Government is working out modalities of providing Autogas conversion kits, and Compressed Natural Gas (CNG)/ Liquefied Petroleum Gas (LPG), mass transit buses to major cities nationwide as cheaper alternatives to PMS/petrol for transportation and fuel.”

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