By Tony Obiechina, Abuja
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed has disclosed that the Federal government will soon release to the States the last tranche of performance-based grants including the $1 billion withheld by the Central Bank of Nigeria (CBN).
The Minister made the disclosure at a dinner to celebrate the achievements of the SFTAS Programme on the sidelines of the 28th Nigeria Economic Summit of the Nigeria Economic Summit Group (NESG)in Abuja.
“I am pleased to inform you that in the next few weeks, your States will receive the last tranche of performance-based grants including the sum of One (1) Billion dollars withheld by the Central Bank through Naira exchange deficit thus bringing to a close, the Performance for Results Grant even though the technical assistance component will continue to be delivered by implementing agencies and partners till June, 2023 when the programme will finally wind down.
“Let me stress that the continued support and commitment of stakeholders particularly the legislature and CSOs at State level are most needed in this last year of programme implementation to deepen on -going reforms and build structures that would entrench the ideals of SFTAS long after the payment of performance grants had ceased.
“At this juncture, I must commend all critical Stakeholders involved in programme implementation for their untiring efforts towards the successful implementation of the programme thus far. In particular, the Programme Coordination Unit (PCU) Management, Consultants and Supporting Staff have been quite wonderful for the proper and efficient coordination of programme activities, the World Bank Task Team for the Technical Support; Implementing Agencies and partners deserve accolades for providing technical assistance to States which resulted in higher performance by the States and finally the States themselves for their resilience, continued support and participation in the programme.
“In particular, I congratulate the States that received awards for outstanding performance in various DLIs. I believe the award will spur you further to strive towards deepening and mainstreaming the reforms in your respective States”, the Minister stated.
Ahmed was optimistic that “with the wholesale adoption of the SFTAS Charter by all the 36 State Governors, the programme ideals already entrenched in the fiscal governance space at sub-national level would continue to enjoy a place of pride in the conduct of fiscal governance even in the absence of any further fiscal incentives.
“Let me stress that the continued support and commitment of stakeholders particularly the legislature and CSOs at State level are most needed in this last year of programme implementation to deepen on -going reforms and build structures that would entrench the ideals of SFTAS long after the payment of performance grants had ceased.
“At this juncture, I must commend all critical Stakeholders involved in programme implementation for their untiring efforts towards the successful implementation of the programme thus far. In particular, the Programme Coordination Unit (PCU) Management, Consultants and Supporting Staff have been quite wonderful for the proper and efficient coordination of programme activities, the World Bank Task Team for the Technical Support; Implementing Agencies and partners deserve accolades for providing technical assistance to States which resulted in higher performance by the States and finally the States themselves for their resilience, continued support and participation in the programme.
“In particular, I congratulate the States that received awards for outstanding performance in various DLIs. I believe the award will spur you further to strive towards deepening and mainstreaming the reforms in your respective States”, she added.
The disbursements are a yet to be determined sum of the last tranche of the $1.5 billion World Bank grant to state governments while the second, is the $1 billion Naira exchange deficit withheld by the Central Bank of Nigeria (CBN).
The grant is coming under the assisted States Fiscal Transparency, Accountability and Sustainability (SFTAS) Programme for Results. The amount to be released is yet unknown because the SFTAS office in Abuja is currently carrying out a review of the states’ performance in meeting the Disbursement Link Indicators (DLIs).
This final disbursement the minister said will “bringing to a close, the Performance for Results Grant even though the technical assistance component will continue to be delivered by implementing agencies and partners till June, 2023 when the programme will finally wind down”.
It was learnt that the $1billion Naira exchange deficit that will also be released to the state governments “is the exchange rate differential between the rate used to calculate the last disbursements and the actual rate”.
So far, N471.9 billion has been released to the state governments under the SFTAS programme. When the last tranche is released that will complete the disbursement of the $1.5 billion two tranche facility of the World Bank.
The $1.5 billion is a World Bank loan to the federal government which in turn is given to the state governments as a grant to encourage them to imbibe and internalise the twin concepts of transparency and accountability.
SFTAS seeks to encourage states to significantly improve in four key result areas: Fiscal Transparency and Accountability; Strengthen Domestic Revenue Mobilisation; Increase Efficiency in Public Expenditure and Strengthen Debt Sustainability.
Sokoto state governor Aminu Tambuwal told journalists that “the SFTAS programme has helped with the institutionalisation of transparency and accountability in the public sector of sub-nationals and it will go a long way in strengthening our public service in the sub-nationals”.
He disclosed that “all the states have committed to a charter of continuing with all the best practices that we have learnt ensuring that we pass it over to coming generations. Its about knowledge, capacity and good governance”.
To ensure continuity of such a programme, the Sokoto state governor said “the World Bank is considering coming up with SABAS so there maybe incentives. Without incentives coming governors will embrace it, it’s for good governance. I believe that the next set of governors and those that will continue their second term should be able to see reason to embrace it because I believe they should all be out for good governance and ensure there is transparency and accountability in public service”.
Since the SFTAS will finally wind down in early 2023, the World Bank has approved the Nigeria State Action on Business Enabling Reforms (SABER) Programme-for-Results.
SABER is another $750 million International Development Association (IDA) credit expected to “help Nigeria accelerate the implementation of critical actions that will improve the business enabling environment in states”.
