The Progressives Governors Forum (PGF) has debunked the claim made by Godwin Obaseki, Governor of Edo State, that the Federal Government printed N60 billion as part of federal allocation for March.
But the forum, in a statement signed by its Chairman, Governor Abubakar Atiku Bagudu of Kebbi State, on Friday stated that Governor Obaseki’s statement did not reflect the true position of things.
According to the forum, which comprises governors elected on the platform of the All Progressives Congress (APC), the comment was an off the cuff remark made in a private meeting but was surprised that Governor Obaseki disclosed this publicly.
It described the Edo Governor’s insistence on his comment and reply to Zainab Ahmed, the Minister of Finance, Budget and National Planning, as “unfortunate and inaccurate”.
The statement read: “Given the significance of the statement from a sitting governor and the possible negative impact it has brought to the credibility of both the federal and State government in managing government finances, the Forum is obliged to put a statement out.
“To set the records clear and to the best of our knowledge, the total distributable statutory revenue for the month of March 2021 was N596.94 billion. Due to the shortfall in gross statutory revenues by N43.34 billion compared to the previous month, an augmentation was made in the sum of N8.65 billion from the Forex Equalization Fund Account, which brought the total distributable revenue to N605.59 billion.
“Federation revenues distributed monthly primarily consist of mineral revenues from the sale of oil and gas, as well as non-mineral revenues from customs and excise duties, company income tax, and value added tax.”
The Progressive Governors admits that there are periods when the country experiences significant fiscal shocks in federation revenues, but says the shocks are offset by other savings serviced from the federation account, including distributions from the domestic excess crude proceeds and the foreign excess crude savings account.
“These payments started since 2008 when the country first experienced fiscal shocks from the fallouts of the global financial crisis of 2008 – 2009. As a trained Economist who has been a Governor since 2016, Mr. Obaseki is aware of all the support states have received from President Buhari in coping with the shocks that have resulted from the CoviD 19 pandemic and resulting economic recession.
“Not only have we received budget support, bail out support to meet salary obligations and infrastructure refunds to all states, this was implemented in the overall public interest without discrimination on the basis of party affiliation. This is why it’s unfortunate and disingenuous to allege preferential treatment of APC states when PDP governed states are even greater beneficiaries of all the support.”
The forum added that there is nothing exceptional in this current review of economic orthodoxy because “almost every Central Bank in the world is taking steps to support their government in coping with the effect of Covid 19 pandemic on the national economy. This has become the norm rather than the exception as all countries grapple with the deleterious effect of economic recession”.
The statement read: “This unfortunate and inaccurate assertion by Governor Obaseki becomes even more worrisome when juxtaposed with the official statement released after the meeting of PDP Governors last week, calling for restructuring and greater devolution of powers to the States. It would appear that matters that require the collective resolve of all leaders are now being turned into purely partisan, point-scoring claims.
“These are challenging times for the country. The COVID-19 pandemic coupled with the recent macroeconomic challenges, has had a significant impact on government finances, however, both the federal and state governments are working assiduously to confront the challenge through greater collaboration to increase independent government revenues, rationalize non-essential spending and improve the efficiency of public spending.
“Indeed, we are beginning to see the positive impact of these initiatives given the country’s exit from recession in the first quarter of 2021.
“Given the constraints faced by the Nigerian economy, the Central Bank of Nigeria had responded commendably well while still working hard on exchange and interest rates. We urge the Governor, management and staff not be distracted. Equally we are grateful to President Muhammadu Buhari and his team for the support and partnership extended to all the federating units.”