News Obiaks News

    Six states have been thrown into a serious financial mess after the Federal Government de�ducted the sum of N32 billion from the monthly allocations of some indebted states in the federation.

The money was deducted from the allocations of states from the Federation Account in the month of April 2016 for various loans they took.
In a report by the Economic Confidential, an economic intelligence magazine, Osun State is worst hit by the development and ranks number one, as its allocation for the month of April 2016 totaling N2.030 billion was wiped away by a deduction of N2.391 billion, leaving a deficit of N361 million to be paid in the subsequent month by the state.

According to the report, the toll was high on Osun State, as its allocation for April 2016 totalling N2.030 billion was wiped away by a deduction of N2.391 billion leaving a deficit of N361 million to be paid in the subsequent month by the state. This represents a whopping 117.8 per cent of the total allocation due the state from the Federation Account.

This means that Osun had nothing to take home for April as other means of survival had to be adopted to keep the ship sailing for the people of the state, the report said.

"Osun State is followed in the mind boggling deduction conundrum by Bayelsa State with a total deduction of N3.207 billion out of an allocation of N4.812 billion for the month of April, 2016 representing 66.66 per cent of the total allocation.

"Others are: Cross River State with a total deduction of N1.405 billion, Ogun State, N1.185 billion, Plateau State, N1.248 billion and Ekiti State with N1.067 billion all representing 63.46 per cent, 57.20 per cent, 56.52 per cent and 55.33 per cent respectively within the period under review,"� the report stated.

It added that from the investigation, not less than N3.078 billion of the total amount was deducted for bailout funds granted the states by the Federal Government, adding that eight states had no deductions on bailout funds for the period.

The states are Akwa Ibom, Anambra, Jigawa, Kogi, Lagos, Rivers, Yobe and the Federal Capital Territory (FCT). The states did not collect the bailout funds from the Federal Government or appropriate time for the deduction have not fallen due and are yet to commence, the report said.

The report added that from the schedule of deductions from the states also included debts on Asset Management Company of Nigeria (AMCON) loan, Commercial Agriculture Credit Scheme, Bond Issuance Programme, contractual obligations and deductions from Excess Crude account. Others are refund/payment arrears of derivation, foreign loans, special intervention/flood management project, the national fadama project and reconstruction of commercial bank loans into FGN bonds apart from bailout funds.