The Delta State Government has disclosed a request for N150 billion in discounting facility, which it says will enable it pay off pensions and infrastructure.
This was disclosed in a press briefing by the state Commissioner for Finance, Chief Fidelis Tilije in Asaba on Wednesday, according to the News Agency of Nigeria.
He added that since 2010, the Federal Government has approved the payment of the sum of N257 billion being recovery from over-deductions and double charges from the 13% oil derivation funds refund.
What Delta State Government is saying
The State Commissioner of Finance revealed that Governor Ifeanyi Okowa’s administration at its inception in 2015, met a debt profile of about N151 billion owed contractors, citing that there is another N69 billion due to the Central Bank of Nigeria (CBN) and other bank-related outstanding payments.
“But this administration has been able to pay over N85 billion of the debt burden within the period,” the commissioner said.
He added that the financing facility of N150 billion being sought was presented to the state House of Assembly for approval on Tuesday, which they said is about 55 per cent of the N257 billion refunds expected from the Federal Government.
- ”The Federal Government has approved the payment of the sum of N257 billion being recovery from over deductions and double charges from the 13 per cent oil derivation funds refund to the Delta government since 2010 to date.
- “The amount that is expected from this recovery is N257 billion for Delta State in one tranche. There is another, which is about N130 billion.
- “We believe that what we are even discounting now is reasonable compared to other benefiting states who discounted 100 per cent of the expected amount from the Federal Government.
- “We have not taken the facility yet, but when we finally take it, we will tie it to receivables from Federal Accounts Allocation Committee, this is why we say it is discounting and not a loan.
- “The state’s ability to achieve the foregoing is however limited by the fact that the expected total refund will not be received into the state’s account in one lump sum.
- “Rather, it will be refunded over a period of five years on quarterly basis with effect from April 2022 to January 2027,” Tilije said.
- “This will ensure that when the next administration comes in, they will have reasonable reserve to lean on and the debt profile will be less,” he said.
He added that the bridging finance facility will also take care of outstanding pension commitments to state and local government pensioners in the Contributory Pension Scheme, amounting to N20 billion and N10 billion respectively.
