State governors has pleaded with the Federal Government to further postpone the repayment of the $2.1 billion budget support loan to states which was scheduled to resume in May.
However, the Governor of the Central Bank of Nigeria(CBN), Godwin Emefiele, kicked against the appeal and explained the implication of a further postponement of the deductions.
These discussions were held on Thursday at the monthly meeting of the National Economic Council (NEC) presided over by Vice-President Yemi Osinbajo.
A statement issued by the Senior Special Assistant to the Vice President on Media and Publicity, Laolu Akande, at the end of the meeting stated that Osinbajo directed that a meeting be held where the issue would be properly considered and a decision reached.
Due to the low internally generated revenue, many states governments have been depending on federal allocations which had also reduced since last year due to crash in global oil prices.
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As a result, most states had resorted to borrowing with a recent report by the Fiscal Responsibility Commission (FRC) stating that the subnational governments had overstepped their limits.
The statement read, “On the budget support facility, finance minister observed that the deductions for repayment by states are meant to resume in May.
“The governors however requested for an extension considering the economic challenges in the states.
“The central bank governor explained the technical challenges involved should there be a further postponement of the deductions.
“The Vice President then directed that a meeting be held soon after today’s NEC where the issue would be properly considered and a decision reached.
“The VP will chair the meeting and the governors will be represented by Governor Kayode Fayemi, while the finance minister and the central bank governor both of whom attended the meeting today will also participate.”
