FG disburses fresh N123.3bn grant to states

The Federal Government on Wednesday announced the disbursement of another N123.348 billion under its States Fiscal Transparency Accountability and Sustainability (SFTAS) programme.

The money is a performance-based grant to the states.

The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, who disclosed this in a statement by Mr. Hassan Dodo, the Ministry’s Director of Press and Public Relations, explained that the disbursement followed the achievement of results by the states in the just-concluded 2019 Annual Performance Assessment (APA).

The disbursement came after the recent one in November, 2020, by the Federal Government where N66.5billion was granted to 35 states which achieved results under another new COVID-19 response Disbursement Linked Indicators (DLIs): the passing of an Amended COVID-19 Responsive 2020 budget by July 31 2020.

The minister observed that since the first disbursement in April 2020, the Federal Government has so far disbursed a total of N233 billion to the states under the $750 million World Bank-Assisted States Fiscal Transparency, Accountability and Sustainability (SFTAS) Programme-for-Results.

The assessment, Dodo noted, was carried out by the Office of the Auditor General for the Federation (OAuGF) as the Independent Verification Agent (IVA) and approved by the Programme Coordination Unit (PCU) of the Federal Ministry of Finance, Budget and National Planning.

According to Ahmed, the disbursement included N91.048 billion of performance-based grants for the 2019 APA results achieved by 32 eligible states across various Disbursement Linked Indicators (DLIs) covering fiscal transparency, accountability, expenditure efficiency, revenue mobilization and debt sustainability. States received the grants in accordance to the number of results achieved, with Sokoto State receiving the highest amount of N6.612billion while Kano State got the lowest amount of N1.710 billion.

“Bayelsa, Imo, Rivers and Zamfara states got zero allocation due to their inability to meet the 2019 eligibility criteria which required states to publish online the approved annual budgets and audited financial statements within a specific time frame,” she said.

She further noted that the 2019 APA results were a significant improvement on the 2018 APA results where the total performance-based grants of N43.416 billion were received by 24 eligible states, demonstrating the substantive progress which states have made on fiscal reforms.

She disclosed that the second part of the disbursement involved a new COVID-19 response DLI: The implementation of a tax compliance relief programme for individual taxpayers and businesses by states by September 30, 2020 where 34 out of 36 states (only Anambra and Zamfara states missed out) were able to achieve the results for this new DLI for the total of N32.3 billion of grants. Ahmed reiterated that the World Bank-assisted SFTAS Programme is principally meant to strengthen fiscal management at the state level so as to ensure effective mobilisation and utilisation of financial resources to the benefit of their citizens in a transparent, accountable and sustainable manner, thereby reducing fiscal risks and encouraging a common set of fiscally responsible behaviours.