Good News! Buhari To Refund Overcharged Funds To State Governments

Forum 7 years ago

Good News! Buhari To Refund Overcharged Funds To State Governments

The administration of President Muhammadu Buhari is to reinburse state governments for the claims of over-deduction for external debt service arising between 1995 and 2002 as a result of first line charge deductions from the Federation Account Allocation Committee (FAAC).

The state governments made the submission to the federal government in respect of the debt service deductions having to do with the Paris Club and multilateral debts.

Some states were said to have been overcharged when Nigeria reached a final agreement for debt relief with the Paris Club in October 2005. The president however directed that the claims be subject to verification by the Debt Management Office (DMO).

To this end, the ministry of Finance announced that a team was established and given the mandate to scrutinise and reconcile the available records.

The brief for the team was also extended to include a review of interim payments made under previous administrations.

Festus Akanbi, spokesperson to Kemi Adeosun, the finance minister, said in a statement that work has commenced to resolve each state government’s claim and that the exercise is expected to take approximately 12 months.

“The exercise will be thorough, including a complete reconstruction of records dating back to the period in question,” the statement said.

The statement said the federal government had reached a conditional agreement to pay 25 percent of the amounts claimed subject to a cap of N14.5 billion to any given state with the balance to be revisited when fiscal conditions improve.