While a probe of the utilisation of the funds across the states is underway to find and penalise erring governors, it has also been discovered that the Federal Government is facing a serious cash flow problem which has also forced it to put on hold further release of the Paris Club funds to the states.
President Muhammadu Buhari is said to have ordered that until a full account of how the first tranche was spent is given, none of the states should get any further release of the funds.
In addition to the problems associated with the utilisation of the first tranche, it was learnt on Friday that the Federal Government, based on a funding advice from the Ministry of Finance and the Central Bank of Nigeria (CBN), has put on hold the disbursement of the second tranche.
The Ministry of Finance had, during the week, stated that the release of the next tranche of the funds, among other things, was dependent on a satisfactory utilisation of the first tranche by each of the states and availability of funds.
A presidency source said on Friday, that states found not to have used, at least, 50 per cent of the first tranche to pay salaries and pensions of their workers and retires would not get the second tranche.
“Information at the disposal of the government shows that many of the beneficiary states did not comply with the terms and conditions attached to the previous releases. A multi-layered probe is ongoing.
“Apart from the independent monitoring of the funds being carried out by a special team in the Ministry of Finance, the Economic and Financial Crimes Commission (EFCC) is also following its own leads. It is at the end of these probes that any of these governors found clean would get the second tranche”, a source in the presidency who asked not to be named.
Another top source in the government introduced a more serious angle to the release of the second tranche with a declaration that “any governor waiting for the second tranche is waiting for Godot.”
The source, who also did not want his name mentioned, said that “there is no money to pay any state now, not this week, not next week, not even next month. Even if the audit is completed tomorrow, a further payment soon is not possible because the money is not there. The Federal Government currently faces cash flow problems.
“The president was put under pressure by governors when he returned from London. That was why he instructed the ministry and the CBN to work on the second tranche. But the minister and the CBN governor have advised that it is not feasible for now.