Senate Urges FG To Review Payments Under Debt Issuance Programme

The Senate, on Wednesday at plenary urged the executive arm of government to review the outstanding payments under its Promissory Notes and Debt Issuance Programme for submission to the National Assembly.

The call was sequel to the consideration of a motion sponsored by Senator Yahaya Oloriegbe (Kwara Central), who in a presentation recalled that in order to address the burning issue of mounting obligations of the Federal Government inherited by the present administration, the Federal Executive Council in July 2017 approved a Promissory Note and Bond issuance programme to clear the arrears of outstanding obligations.

According to him, the Federal Government set up a verification committee chaired by the then Minister of Power, Works and Housing, Babatunde Fashola to verify all claims submitted by the Ministry of Finance under the Promissory Notes and Bond Issuance Programme.

Continuing, he said that the report of the verification was again subjected to audit by the Presidential Committee on Continuous Audit (PICA) before a final amount was arrived at after rounds of negotiations and discount schemes agreed with the proposed beneficiaries.

He recalled further that in March 2018, the President of the Federal Republic of Nigeria sent a request to the Senate for approval by the National Assembly to commence a N2,697,820,794,305.91 Promissory Note and Bond issuance Programme to clear outstanding obligations inherited by the Buhari’s administration.

These included unpaid obligations to pensioners, salaries and promotional arrears to civil servants in the sum of N740,752,291,351.91; Obligation to Petroleum marketers on Subsidy in the sum of N429,054,203,228; Federal Government Major Contractors and Supplier debts and outsourced liabilities of N654, 536,409,687.60.

Others are unpaid power bills and obligations from tariff reversal in 2014 to DISCO’s and GENCO’s N496,775,452,038.61; Export Expansion Grant (EEG) Scheme debts N350,383,295,143.23; Judgement debts N112,958,703,764.45; and Refunds to State Governments for projects undertaken on behalf of the Federal Government N584,983,966, 973.18.

Oloriegbe noted that “the 8th National Assembly approved some of the promissory notes and Bond issuance in the following amounts: N573,494, 697, 133.63 as payment of refunds to 25 State Governments for Federal Highway Projects executed on behalf of the Federal Government; N206,065,107,252.69 as payment to various major contractors; N348,003, 054,975 as payment to Petroleum Marketers for arrears of subsidy; and N195,089,234,808.63 as payment to exporters as Export Expansion Grant;

“Concerned that in spite of the above approvals in the sum of N1,322,652,094,169.95, a considerable number of these outstanding obligations which accrued from periods ranging from the year 2000 to the year 2017 (and now till date) still remain unpaid;

 “Disturbed that from the last figures published by the Debt Management Office on its official Website in February 2020, only the sum of N914,212,563,852 (Nine Hundred and Fourteen Billion) has been issued under the Federal Government of Nigeria Promissory notes programmne as at December 31, 2019;

“Worried that after the approval of the N1.3 Trillion Naira from the total sum of 2.6 trillion by the 8th National Assembly, nothing has been done in respect of approvals of the outstanding balance of N1.3 trillion by the Senate;

“Troubled that the long term debt effect on the various corporate entities whose monies still remains unpaid after several years, with the attendant financial consequences including interest accruals, Loss of Jobs and often failed Companies;

“Further troubled that various Companies have legitimate claims for interest and or penalty payments due to them as contained in the various contract agreements signed with the Federal Government, an issue which will require serious consideration, dialogue and negotiations between Federal Government, the contractors and the financial institutions involved;

“Observes also that for example, the outstanding claims in respect of the incentive and result based Export Expansion Grant Scheme covers a period from 2007 – 2016, clearly showing that some of the accruals are at least 14 years past due;

“Worried that job losses, failed banks and companies going under which is a daily occurrence in Nigeria are occasioned by failure of Government Ministries, Departments and Agencies to meet financial obligations as contained in contractual agreements; and

“Concerned that the amount of outstanding liabilities of the Federal Government ordinarily would have soared from the March 2018 figures and would require an update of figure from the Federal Ministry of Finance, Budget and National Planning.”

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