No Second Bailout for States as FG Defers Loan Deductions from States’ Allocations

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Tobi Soniyi in Abuja

Finance Minister, Kemi Adeosun, has said that the Federal Government will for now not deduct any money from states’ allocations to service the loans obtained by the states so as to allow them pay their workers’ salaries.

Briefing journalists at the end of a meeting of the National Economic Council held at the State House in Abuja, she said that the decision to stop the deduction was informed by the fact that states did not have enough resources to meet their day-to-day challenges‎.

She said there would be no second bailout for the states. Rather, the deferral should allow the states to meet their obligations.

According to her, low receipts from oil meant that there were not enough revenues to share thereby making it harder for states to survive.

She said: ‎”The is an update on the financial situation in the states. It was discussed extensively that currently the federation accounts receipts are among the lowest that has been seen in recent memory.

“We are looking at N 299 billion this month and that is because of the very low oil prices recorded in February and January, if you remember oil prices went as low as $28 and $31 and that has affected through to a very low federation account figure.”