Loan or Grant Not The Issue, States Received N573 Billion, Focus on National Development -Presidency Replies Seyi Makinde, Abdulahi Sule

By: Abdulwasiu Akintunde 

The Presidency has responded to ongoing debate regarding the N573 billion received by States, clarifying that the amount is a World Bank loan guaranteed by the Federal Government, not a grant. 

As gathered by OPEN TELEVISION Naija (OTN) News, the focus, according to the Presidency, should not be on whether the funds are a loan or a grant, but rather on how they can contribute to the country’s development. 

This clarification was provided by the Senior Special Assistant to the President on Media and Publicity, Temitope Ajayi.

Ajayi emphasized, "The key issue is not whether the money is classified as a loan or a grant. The President's broadcast clearly stated that the states have received these funds." 

He explained that the N573 billion represents the second tranche of funds under the COVID-19 livelihoods support scheme, part of the NG-CARES Programme financed by the World Bank.

Ajayi highlighted that this World Bank facility is backed by a sovereign guarantee from the Federal Government, meaning that if the states fail to repay, the responsibility falls on the Federal Government. 

He stressed that the real concern should be about how these funds can be used to improve the lives of the citizens. 

Ajayi noted, "There should be no controversy from any Governor if the true goal is to serve the people and enhance their quality of life."

He further explained that both President Tinubu and the State Governors share the common responsibility of improving the lives of their citizens. 

President Tinubu, he added, is committed to expanding the economy and fostering shared prosperity across Nigeria. He views the Governors as essential partners in the nation-building process.

However, Ajayi also pointed out that with these funds, States now have additional resources to improve services in critical areas such as education, healthcare, security, and infrastructure development. 

He dismissed the debate over the classification of the funds as a matter of semantics, underscoring that the important fact is that this is the second tranche of payments, following an earlier tranche disbursed in October or November of the previous year. 

Additionally, Ajayi suggested that the issue has been unnecessarily complicated by one or two Governors who have reduced the discussion to mere wordplay.

“The reality is that the Federal Government disbursed the funds to the states, with the N573 billion representing the second tranche of payments. The first tranche was distributed around October or November last year," he clarified. 

Over the weekend, Oyo State Governor, Seyi Makinde and Nassarawa State Governor, Abdullahi Sule, had claimed that the only funds they received from the Federal Government were through a World Bank loan. 

Governor Makinde explained, “This situation has been misrepresented. The funds in question were part of the World Bank-supported NG-CARES project, which is a Programme for Results initiative."

"The World Bank facilitated this intervention to support Nigerian States in their COVID-19 recovery efforts. CARES stands for COVID-19 Action Recovery Economic Stimulus."

He further noted, "The initiative was called Programme for Results because States had to initially use their own resources to implement the program. After the World Bank verified the expenditures by the States, it reimbursed them through the mechanisms provided at the Federal level."

"The Federal Government did not directly give any State money, but they simply acted as the channel through which the reimbursements were processed for the expenses already incurred by the states," he revealed.