States eager to have the $3.45 billion second tranche of the London-Paris Club loan refund may have to wait longer than planned, it was learnt.
Federal Government is withholding the cash – due to what is believed to be the mismanagement of the first tranche, leading to massive corruption.
The delay follows the ongoing probe of N19bn and $86.5million deducted by Nigeria Governors Forum (NGF) from the first tranche of N522.74billion.
The Presidency is awaiting the outcome of investigation by the Economic and Financial Crimes Commission (EFCC) on the first release.
The government is believed to have tactically attributed the delay in remitting the second tranche to the “cash squeeze” the country has been undergoing.
But the governors are angry that some Presidency forces have influenced President Muhammadu Buhari to have a “rethink” on the second tranche.
The President had on April 2, May 24 and May 31, 2016, met with the leadership of the NGF on the financial crisis affecting most of the states, especially non-payment of salaries and pensions.
The governors demanded $6.9billion refund from the Federal Government to states and local governments for alleged over deduction for loans servicing.
They also asked for refund of the money spent by the states on Federal Government projects.
The President conceded to the governors on five conditions:
50% of the claims submitted by the states be released, prior to completion of the reconciliation, to support states;
25-50% of the cash released will be used to settle outstanding salaries and pension arrears in most states;
There will be judicious use of the remaining 50% on development projects; and that
Local governments will have access to their share of the refund.
The presidency is said to have realised that most of the governors have defaulted in the conditions attached to the release of the refund.
The government is worried about the diversion of N19billion and $86million deducted for payment to consultants and legal advisers engaged by the NGF and some states.
A government source, who spoke in confidence, told The Nation that: “The Buhari administration meant well. To show its commitment, it raised a Refund Committee comprising the Acting President, who is also Chairman of the Board of DMO and the Economic Council; Chief of Staff, Abba Kyari(the chief driver of the Refund Movement; The NGF chairman, Alhaji Abdulaziz Yari (Co-Chief Driver of the Refund Movement); the DG of NGF, Mr. Asishana Okaru (Co-odinator of states); Suraj Yakubu (GSCL Consulting Limited) as consultant-in-Chief; Bizplus Consulting Limited, another Consultant, and Alhaji Sani Anani, the refund marketer.
“The committee came up with a template for the release of the first tranche of N522.74billion.”
But security reports on how some governors misapplied the money have shocked the Presidency.
“Many states still owe workers unpaid salaries for as many as 10 months. In some states, pensions have accumulated for about 12 to 15 months. Instead, some governors have diverted the refunds to private use.
“The discovery of EFCC on how some of the loan refunds got into private hands made the government uncomfortable.”
According to the source, “this is why the Federal Government has withheld the second tranche to the states”.
At a meeting with Minister of Finance Mrs. Kemi Adeosun, the governors were said to have been angry that the second tranche was yet to be released.”
Asked why the government was keeping the governors in suspense on the second tranche of $3.45billion, the source said: “most of the states did not meet the conditions for the release of the first tranche as they still owe some salary arrears.
“As I am talking to you, the reconciliation of claims by the Federal Government and the states is yet to be concluded. The government is being cautious to avoid overpayment to states, the source said, adding:
“More importantly, the EFCC is currently looking into some allegations on the mismanagement of N19bn and $86.5m paid into the accounts of the NGF for payment to consultants and legal advisers. Some consultants who were not hired have been paid while those who did the reconciliation jobs are denied their rights.
“The NGF said it will cooperate with the EFCC. We are awaiting the outcome of the investigation before remitting more refunds.
“We are delaying in effecting more refunds because we need to be circumspect. The governors are angry no doubt but there is no point allowing public funds to go into wrong hands.”