The National Economic Council on Thursday approved a fiscal sustainability plan to help the 36 states of the federation recover from their current poor economic conditions.
Following the massive drop in oil revenue accruals in the federation account as a result of the decline in global crude oil prices from a high of over $100 per barrel in 2013 to less than $25 last year, monthly allocations to the states have been dwindling.
No fewer than 27 of the states have been facing an ordeal paying their workers and contractors, despite a bailout early last year from the federal government.
CBN governor, Godwin Emefiele, said about 30 states have so far benefited from the salary bailout from the bank as at May 18, while 35 states have applied for the Excess Crude Account-backed loans.
At its monthly meeting in Abuja, Thursday, presided by the Vice President Yemi Osinbajo, the Council announced a fiscal sustainability plan to help the states come out of the current economic condition.
The meeting was attended all 36 state governors and the governor of the Central Bank of Nigeria, CBN.
Highlights of the plan and framework presented by the Minister of Finance, Kemi Adeosun, included five objectives and action points to help realign the fiscal behaviour of states with the federal governments short and long-term sustainability goals.
These include elements of accountability and transparency; increase in public revenue; rationalization of public expenditure; public financial management reforms, and sustainable debt management.
Financial indiscipline and lack of accountability has driven most of the states into huge debts to banks and other financial institutions.
During the meeting, the Council reviewed the strategic plan for the 2016 budget implementation, covering 34 priority actions across four fundamental areas, which government believes would facilitate national transformation.
Minister for Budget and National Planning, Udo Udoma, said the four areas for prioritized execution and implementation of the government’s short-term strategy included investing in critical infrastructure; embracing and encouraging private sector; continuous advocacy for greater social inclusion, and improving security and tackling corruption.
The strategies for achieving the goals across six thematic areas of the 2016 budget, the minister said, included changes in the policy environment, national security and governance, diversifying the economy by fast-tracking industrialization, agriculture and agro-allied processing, as well as attracting investment into solid minerals, tourism and entertainment sectors.
On priority critical infrastructure, Mr. Udoma said focus would be on increasing investment in power, rail, roads and housing; oil and gas reform; ease of doing business; social investment and robust monitoring and evaluation (M&E framework).
He said going forward, the ministry would utilize the revised national monitoring & evaluation framework to carry out physical inspections and other verification exercises in the system to enable government track the achievement of actual outputs and outcomes.
On solid minerals development, Minister of State for Solid Minerals presented the highlights, which showed that Nigeria lost its position as a leading producer and exporter of Tin and columbite as well as the sixth producer/exporter of the metal and producer of coal, among others due to greater attention to oil exploration and exploitation.
Mrs. Adeosun used the meeting to brief members on the balance in the excess crude account, ECA, which she said stood at about $2.26 billion as at April 30, 2016, apart from interest of about $429,903.55 that has accrued on the account for the month.
The Council also received the report from the committee on crude oil theft and prevention constituted in 2013 to consult with the Armed Forces Joint Task Force (JTF), oil companies, oil producing states, Nigerian Security and Civil Defence Corps (NSCDC) on the causes of the growing incidence of crude oil theft.
The committee recommended the procurement and deployment of appropriate technology in surveillance and combat vehicles/boats in difficult terrain to reduce incidents of oil thefts and illegal bunkering, while ensuring uninterrupted supply.
It called for the special courts for speedy prosecution of oil bunkerers and oil theft suspects, while engaging traditional rulers to sensitize their communities on the criminal and environmental dangers of oil theft.