The Federal Government will cease disbursing the N90 billion conditional loan to state governments any month the allocation from the federation account goes above N500 billion.
According to the Special Adviser on Media to the Minister of Finance, Festus Akanbi, who spoke with The Punch, it would be unwise for the federal government to continue disbursing the loan to states if the allocation shared by the three tiers of government exceeds N500 billion.
“The budget support facility, which is conditional upon the implementation of the 22-point fiscal sustainability plan, is not a bailout.”
“The implementation of the FSP is to be completed over an 18-month period. Monthly disbursements to each state will be conditional on compliance with pre-agreed FSP milestones.”
“The facility will cease to be available in the next month if the distributable amount from the Federation Account is equal to or exceeds N500bn in any given month.”
He noted that 35 states were gearing up to submit the documents required to get the loans.