The Abia State Government has, in what appears like a volte face, flatly denied getting any bailout from the Federal Government for the payment of workers’ salary arrears.
It will be recalled that the Special Assistant to the Governor on Media, Mr. Ugochukwu Emezue, had on Monday stated that the state had received N3bn bailout from the Federal Government, adding that N6bn was needed to clear the backlog of arrears of workers’ salary.
However, the Special Adviser to the Governor on Economic Affairs, Mr. Obinna Oriaku, said there was no truth in the information. He stated this at a press briefing on Thursday, explaining that what the state received was N3.2bn which was its share of the $1.7bn Liquefied Natural Gas tax shared among the three tiers of government.
According to Oriaku, N1.2bn out of the fund was the share of the 17 local government areas in the state while the balance of N2bn was the state government’s share.
He said the fund was meant for the payment of salaries, maintaining that the much-talked-about bailout has not been received, urging members of the public to disregard the earlier “misinformation” regarding the bailout.
He however said the state government was working with the Debt Management Office and the Central Bank of Nigeria on how to get a bailout.
On the N30 billion loan request approved by the State House of Assembly, the Special Adviser said it was not “a fresh borrowing”, explaining that the money was the accumulation of all the debts owed by Abia Government, including salary arrears, pensions, debt owed contractors and other debts owed by agencies of government.
According to him, one of the conditions given by the Federal Government to take over debts owed by state governments as bonds was that the state’s House of Assembly must give a legal back-up to the option, hence the approval granted to the governor’s request by the lawmakers.
He explained that the Central Bank of Nigeria would be the guarantor of the N30bn bailout and would be deducting same from source, with re- payment spread over 20 years.
He said: “It means that the Federal Government will acquire the debts as bonds and the condition of payment is easier. Many states are heavily geared, including Lagos which owes about N400bn.”
Asked if the House did not understand the governor’s letter on the loan request to have said that it was approved to enable the government execute the dredging of Aba River and other infrastructure, Oriaku said the lawmakers had started to clear the misinterpretation.
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