Contrary to previous assumptions, TheCable has reported that the relief aid allocated to states by the federal government to mitigate the impact of the petrol subsidy removal is, in fact, a loan.
Earlier, the government had announced a N5 billion relief package for each state, including the Federal capital territory (FCT).
Babagana Zulum, the Governor of Borno, revealed during a press briefing that this palliative is intended to assist state governments in procuring 100,000 bags of rice, 40,000 bags of maize, and fertilizers, aimed at alleviating the effects of food shortages across the nation.
This revelation signifies a shift from the initial understanding that the relief package was a grant rather than a loan.
However, in a memo to governors entitled “Re: Distribution of Palliatives – Terms of FG Facility”, Asishana Okauru, director-general of Nigeria Governors Forum (NGF), said states might opt out of the offer and return a sum of N2 billion already given to them.
“I have been directed by the Chairman, H.E. AbdulRahman AbdulRazaq to forward the terms of the facility as follows,” Okauru said in the memo.
“Facility size: N4,000,000,000.00
Loan (48%): N1,920,000,000.00
FGN Grant: (52%)
N2,080,000,000.00 Beneficiary each state government
Tenure: 20 months
Interest Rate: Nil
Moratorium: Three months
Repayment Mode: Monthly
Repayment Amount: N120,000,000.00
Security Irrevocable Standing Payment Order (ISPO)
“Your excellency is invited to note that this offer is optional and states that do not wish to participate may opt-out and refund the N2 billion already disbursed to them.”