The ₦573 billion payment to state governments is a loan from the World Bank, not a grant, says the Presidency.
There has been some controversy surrounding the fund, with some state governors disputing reports that they got the money as ‘palliatives fund’ from the federal government.
But Senior Special Assistant to the President on Media and Publicity, Temitope Ajayi, stated at the weekend that the loan is part of the Covid-19 livelihoods support scheme under the NG-CARES Programme funded by the World Bank.
Ajayi’s clarification comes after some governors denied receiving federal government’s grant, sparking controversy over the payment.
Ajayi emphasised that the federal government guarantees the loan, which means it will be responsible for repayment if the states are unable to pay.
The Presidency’s statement comes after some governors denied receiving a grant from the federal government, sparking a debate over the nature of the payment.
Ajayi stressed that the focus should be on the positive impact of the funding on the lives of citizens, rather than the semantics of whether it is a loan or grant.
The Presidency assured that President Tinubu will continue to work with governors as partners in nation-building, expanding the economy, and enabling shared prosperity for all Nigerians.
The payment is expected to support state governments in meeting their financial obligations and implementing development projects.
“They are not denying. They are saying it is not a grant, a dash from federal government. That it is a loan from World Bank
“I think the issue is not whether it is a loan or grant. The point, as clearly stated in the President’s broadcast is that the states got money and the amount, which is the second tranche under the Covid-19 livelihoods support scheme under the NG-CARES Programme funded by the World Bank, is N570 billion.
“The fact of the matter is states are getting needed support and funding to improve the lives of the people. Meanwhile the World Bank facility is guaranteed by the federal government because every multilateral loans must have Sovereign guarantee which means the loan will be paid by the FG in case the sub-nationals are unable to pay.
“There should be no hue and cry by any governor really if the objective is to serve the people and make life better for the masses. The President is elected to make life better for citizens same way the governors are elected to do same in their respective states.
“President Tinubu will continue to work to expand the economy and enable shared prosperity for all Nigerians. He considers the Governors as partners in progress and in the job of nation-building.
“What can’t be denied is that the states have more resources to deliver better service to the people, especially in critical areas of education, healthcare, security and physical infrastructure like roads among others”, Ajayi said.
The Presidential spokesman described the issue as more than just semantics, explaining that the payment was the second tranche, with the first tranche paid in October or November last year.
“I think the issue here is one or two governors trying to reduce the matter to semantics. It is much more than that. The fact remains that the federal government paid the states the money and the N573 billion is actually the second tranche. The first tranche was paid sometimes in October or November last year”, he said.
