UPDATED: FG disburses N43,416bn to 24 states under SFTAS

The Federal Government has disbursed the sum of N43,416,000,000.00 ($120.6 million) to 24 states of the federation through performance-based grants under the World Bank-Assisted States Fiscal Transparency, Accountability and Sustainability (SFTAS) Programme-for-Results. The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, disclosed this in a statement issued by Mr Hassan Dodo, the Ministry’s Director of Press and Public Relations, in Abuja. SFTAS is wholly-financed with a loan of $750 million from the International Development Association (IDA), a member of the World Bank Group.
Mrs Ahmed said that eligible states were selected on the basis of the results achieved in 2018 under the performance assessment. She explained further that the disbursement followed the participation of the 24 eligible States in the recent Annual Performance Assessment (APA) carried out by the Office of the Auditor-General for the Federation (OAuGF) as the Independent Verification Agent (IVA) in collaboration with a third-party firm, JK Consulting Limited and the SFTAS Programme Coordination Unit (PCU). The SFTAS Programme was established by the federal government with the concessional World bank loan to support states to enhance their capacity to achieve the Disbursement Linked Indicators (DLIs) which are the Programme results.
 Under the programme, $700 million was for the provision of performance-based grants to States and technical assistance in the sum of $50 million. According to the minister, “The DLIs are derived from the country’s 22-Point Fiscal Sustainability Plan and the 14 Open Government Partnership (OGP) commitments aimed at strengthening fiscal transparency, accountability and sustainability across all States of the Federation.”
She reiterated that the World Bank-assisted SFTAS Programme was principally to strengthen fiscal management at the State level, so as to ensure effective mobilization and utilization 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 fiscal behaviours.
Mrs Ahmed observed that the SFTAS programme couldn’t have come at a better time than now given the dwindling government revenue occasioned by oil price volatility coupled with the current impact of COVID-19 which has further intensified the need for improved practices in fiscal transparency, accountability and sustainability as enunciated in the SFTAS ideals. On the Eligibility Criteria (EC), the minister said that States had to meet in order to be eligible to receive any grants included: the online publication of the approved annual budget and audited financial statement for the previous year.
The 24 states were said to have achieved: improved financial reporting and budget reliability; increased openness and citizens’ engagement in the budget process; improved cash management and reduced revenue leakages through the implementation of State Treasury Single Account (TSA); strengthened Internally Generated Revenue (IGR) collection; biometric registration and Bank Verification Number (BVN) used to reduce payroll fraud. Others are improved procurement practices for increased transparency and value for money; strengthened public debt management and fiscal responsibility framework; improved clearance/reduction of the stock of domestic expenditure arrears; and improved debt sustainability.
The 24 beneficiary states who were: Abia, Adamawa, Bauchi, Benue, Delta, Edo, Ekiti, Enugu, Gombe, Jigawa, Kaduna, Kano, Katsina, Kebbi, Kogi, Kwara, Niger, Ondo, Ogun, Oyo, Osun, Sokoto, Taraba and Yobe States.
Kaduna State achieved the highest number of results (nine) and got the highest share with N3. 960 billion, while Katsina and Benue got the lowest amount of N540 million each. Mrs Ahmed disclosed that those States declared ineligible for 2018 failed to publish their annual budgets and audited financial statements online within the time frame as stipulated by the SFTAS Programme Operation Manual (POM).
The 12 States that missed out on the 2018 grants because they did not meet the Eligibility Criteria were: Akwa Ibom, Anambra, Bayelsa, Borno, Cross River, Ebonyi, Imo, Lagos, Nasarawa, Plateau, Rivers and Zamfara States. However, the SFTAS Programme accommodates different starting points, hence the 12 States can still participate in the 2019,2020 and 2021 respective performance years by meeting the EC and DLIs in the said years.

April 29, 2020

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