Following the decision of the Federal Government to commence deduction from the monthly allocation of States, as part of refund for bail out funds it received last year, Imo State risk losing more than N1 billion naira from the deductions.
The Federal Government had last year given more than 600 billion naria to 35 states in the federation, including Imo to pay outstanding workers salary and pensions.
Minister of Finance, Budget and National Planing, Mrs. Zainab Ahmed had said that the deduction would begin in the Federation Accounts Allocation Committee (FAAC) provision for States in September.
She said that the funds would be deducted from source and remitted to the Central Bank of Nigeria (CBN), adding that the refund would not form part of the revenue for funding the budget.
“It was a loan which was advanced by the CBN and the repayment will be made to the same CBN.
“So the recovery process for us is to deduct from the FAAC allocation to the states and remit same to the CBN.
“We are going to start these remittances by the next FAAC. So there will be no requirement for us to consider the Fiscal Sustainability Plan (FSP) implementation.
“We want the states to stay on the path of fiscal sustainability, but it will not be a condition for the deduction. We will deduct direct from source and remit to the CBN,” the minister said.
Imo State was reported to have received N 26 billion naria from the loan when Rochas Okorocha was governor.
State Governors had expressed willingness to re pay the loan but it was observed that they may be biting their fingers over the repayment considering the huge burden facing most of them in their States.
Chief Press Secretary to the Governor, Mr. Chibuike Onyeukwu, had during an interaction with editors of Owerri based newspapers, said the State stand to lose N1.2 billion naira from the deductions.
He said the State Government, in the face of the deductions had taken proactive measures to wade off any impact of the deductions.
He said part of the measures by the Governor is to seek collaboration with international Development agencies across the globe to assist the State government in the task of developing the State.
Governor Ihedioha had last month visited the United States where he engaged the U.S Black Congressional Caucus, the United States Agency for International Development, USAID, the DFID and other agencies where he discussed the huge investment opportunities in Imo State.
On his return from the trip, he told newsmen that he held useful deliberations with officials of the agencies which will translate to huge benefits for the State. He further added that the visit is aimed at looking beyond the shores of Imo State in a bid to expand its economic base of the State.
“ It was an economic and diplomatic visit to the United States of America, where we had cause to interface with the Congressional Black Caucus. We visited the State Department, we also visited the World Bank, DFID, and of course, USAID. And we had useful delibrations”