States Must Pay Salaries Before Accessing Balance Of Paris Club Refund – FG Insists

SAN FRANCISCO, September 12, (THEWILL) – The Federal Government has stated that states must pay outstanding salaries to workers before they can receive their balance of the Paris Club Refund.

This was revealed by Federal Ministry of Finance in a statement on Tuesday while listing other conditions for the collection of the remaining funds.

“The final approval of US$2.689 billion is subject to the following conditions:

“Salary and staff related arrears must be paid as a priority; Commitment to the commencement of the repayment of Budget Support Loans granted in 2016, to be made by all States; Clearing of amounts due to the Presidential Fertiliser Initiative.”

The Ministry also asked the states to “clear matching grants from the Universal Basic Education Commission (UBEC)” insisting that some states have available funds which could be used to improve primary education and learning outcomes.

THEWILL recalls that issues of over-deduction of the Paris Club loan had caused a long-standing dispute between the Federal Government and the State Governments, dating as far back as 1995.

However, President Muhammadu Buhari, in 2016, directed that the claims of over-deduction be formally and individually reconciled by the Debt Management Office (DMO).

As an interim measure to alleviate the financial challenges of the states during the 2016 recession, the President further approved that 50% of the amounts claimed by states be paid, to enable them clear salary and pension arrears.

The funds were then released between December 1, 2016 and September 29, 2017.

However, the ministry says full payments will only be made after the aforementioned conditions are met.

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