The Federal Government has deducted N32 billion from allocations to states from the Federation Account in the month of April 2016. This deduction from source covered the different loans incurred by the affected states.
This was disclosed in a report by the Economic Confidential, an economic intelligence magazine.
The report said Osun State was worse hit by the development, as its allocation for the month of April 2016 totaling N2.030 billion was wiped away by its debt of N2.391 billion, leaving a deficit of N361 million to be paid in the subsequent month. The sum represents 117.8 percent of the total allocation due the state from the federation account.
The same fate befell Bayelsa State with a total deduction of N3.207 billion out of an allocation of N4.812 billion, representing 66.66 percent of the total allocation.
Others affected include: Cross River State with a total deduction of N1.405 billion, Ogun State, N1.185 billion, Plateau State, N1.248 billion and Ekiti State with N1.067 billion all representing 63.46 percent, 57.20 percent, 56.52 percent and 55.33 percent respectively within the period under review.
From the investigation, not less than N3.078 billion of the total amount was deducted for bailout funds given to the states by the Federal Government. Eight states had no deductions on bailout funds for the month of April 2016, which include: Akwa Ibom, Anambra, Jigawa, Kogi, Lagos, Rivers, Yobe and the Federal Capital Territory. These states, according to the report, did not collect the bailout funds from the federal government or appropriate time for the deduction have not fallen due and are yet to commence.
Meanwhile, from the schedule of deductions obtained and computed by the magazine, the deductions from the states also include debts on AMCON loan, Commercial Agric Credit Scheme, Bond Issuance Programme, Contractual obligation, and deduction from Excess Crude account. Others are: refund/payment arrears of derivation, foreign loans, special intervention/flood management project, the national fadama project and reconstruction of commercial bank loans into FGN bonds apart from bail-out funds.