President, Muhammadu Buhari has approved over N400 billion as an intervention fund to end the lingering crisis of unpaid workers’ salaries.

The relief package also includes about N300 billion soft loan for states to access for the same purpose.

About $2.1 billion (N413.7 billion) of the money was said to be sourced from the recent Liquefied Natural Gas proceeds paid into the Federation Account.

Central Bank-packaged special intervention fund that will offer financing to the states, ranging from N250 billion to N300 billion, is another source of the fund, which would take care of the soft loan available to states to access.

Equally part of the intervention is a debt relief programme proposed by the Debt Management Office, which will help states restructure their commercial loans currently put at over N660 billion and extend the life span of such loans while reducing their debt-servicing expenditures.

At an extra-ordinary meeting of the Federation Account Allocation Committee held on Monday, Central of Nigeria (CBN) Governor Godwin Emefiele informed state governments that the Federal Government was worried about the inability of some states to meet their obligation to their workers in the area of monthly wages.

He noted that the inability of most states to pay salaries was due to the huge debt hanging on their necks.

Mr Emefiele said: “Most States take short term loans for long term projects and servicing their monthly obligations to the banks hampers cash flows, thereby restricting them from payment of salaries.”

The CBN Governor also informed the states that the apex bank was willing to assist such states in restructuring the loans owed the commercial banks.

He directed the affected States to submit to the CBN, on or before July 8 the list of their loan obligations and other indebtedness to enable the CBN assist them restructure the loan to a long tenure. He explained that the assistance by the CBN was in the form of concessionary rates to the interested states.

Mr Emefiele said the CBN would schedule a meeting with the States upon receipt of the required data and expressed optimism that the process would be completed before next week.

He advised recipients of the CBN loans to prioritise salary payment, as its first line charge, before meeting other obligations.

The meeting was chaired by Permanent Secretary, Federal Ministry of Finance, Mrs Anastasia Daniel-Nwaobia. Also present were the Accountant-General of the Federation, Mr Idris Ahmed, State Commissioners of Finance, State Accountants-General, and Representatives of Federal Inland Revenue Service and Nigeria Customs Service.

•Adapted from a Channels TV report.

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