FG disburses new $324.6m grants to states
NEWS DIGEST – The Federal Government has disbursed another round of performance-based grants to states in the sum of N123.348bn ($324.6m) under its States Fiscal Transparency Accountability and Sustainability Programme for Results.
Minister of Finance, Budget and National Planning, Zainab Ahmed, disclosed this in a statement issued in Abuja on Wednesday by the ministry’s Director of Press and Public Relations, Hassan Dodo.
Ahmed explained that the disbursement followed the achievement of results by the states in the just concluded 2019 Annual Performance Assessment.
The assessment was carried out by the Office of the Auditor-General for the Federation as the independent verification agent and approved by the programme coordination unit of the finance ministry.
On the disbursements, the minister said it included N91.048bn ($239.6m) of performance-based grants for the 2019 APA results achieved by 32 eligible states across various Disbursement Linked Indicators.
She said the indicators covered fiscal transparency, accountability, expenditure efficiency, revenue mobilisation and debt sustainability.
States received grants in accordance with the number of results achieved, with Sokoto State receiving the highest amount of N6.61bn, while Kano got the lowest amount of N1.71bn.
“Bayelsa, Imo, Rivers and Zamfara states got zero allocation due to their inability to meet the 2019 eligibility criteria which required states to publish online approved annual budgets and audited financial statements within a specific timeframe,” Ahmed stated.
She further noted that the 2019 APA results were a significant improvement on the 2018 APA results where the total performance-based grants of N43.416bn ($120.6m) were received by 24 eligible states.
This, she said, demonstrated the substantive progress states had made on fiscal reforms.
According to her, the second part of the disbursement involved a new COVID-19 response DLI, which was the implementation of a tax compliance relief programme for individual tax payers and businesses by states by 30 September 2020.
On this, she said 34 out of 36 states were able to achieve the results for the new DLI for the total of N32.3bn ($85m) of grants, as only Anambra and Zamfara states missed out.
The disbursement came after the recent one in November 2020 by the Federal Government where the sum of N66.5bn ($175m) was granted to 35 states.
The minister observed that since the first disbursement in April 2020, the Federal Government had thus far disbursed the total sum of N233bn ($620.6m) to the states.
This, she said, was under the $750m World Bank-Assisted States Fiscal Transparency, Accountability and Sustainability Programme for Results.
Ahmed said the World Bank-assisted SFTAS programme was principally meant to strengthen fiscal management at the state level so as to ensure effective mobilisation and utilisation of financial resources.
She said the resources were for the benefit of citizens in a transparent, accountable and sustainable manner, thereby reducing fiscal risks and encouraging a common set of fiscally responsible behaviours.
According to her, the SFTAS programme could not have come at a better time, given the dwindling government revenue occasioned by oil price volatility and the impact of COVID-19.
Ahmed stressed that with the disbursement of N233.26bn since the beginning of the programme, the government had successfully adapted and implemented the SFTAS to provide timely support to states.
She said this was with a view to strengthening the fiscal capacity for responding to numerous fiscal challenges in their respective domains.
“The increase in the number of benefitting states and results achieved is indicative of the wider acceptance of SFTAS ideals by all states of the federation and this would herald a new era of transparency and accountability in fiscal governance at the sub-national level,” Ahmed said.