More Debt! Buhari Government Considers Taking N2 Trillion Loan From Pension Fund

More Debt! Buhari Government Considers Taking N2 Trillion Loan From Pension Fund

By Wires | The Trent on December 24, 2019
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Zainab Ahmed, the Minister of Finance
Zainab Ahmed, the Minister of Finance

Nigeria may have to borrow N2 trillion from the Pension Fund if the National Economic Council, NEC, gives the go ahead to do so early next year.

This indication was given on on Thursday, December 19, 2019, during a briefing by governors Babajide Sanwo-Olu (lagos), Atiku Bagudu (Kebbi) and the Minister of Finance, Budget and National Planning, Zainab Ahmed, after NEC’s 100th meeting.

The meeting, which was presided over by the Vice President, Yemi Osinbajo, was held at the Council Chamber of the State House in Abuja.

Speaking to State House Correspondents on an interim report of a sub-committee set up to consider how pension fund can be utilised for infrastructure development, Governor Bagudu said the sub-committee had identified critical development areas where the fund can be useful.

According to him, the sub-committee had observed that the trend is not peculiar to Nigeria, adding that it suggested that about N2 trillion to invest into roads, rail and electricity projects.

“So, on Thursday, the sub-committee presented an interim report where they advised on some of the issues that came up while deliberating.

“Of particular note was that other countries have been using the same mechanism  – South Africa, Saudi Arabia and others have been using their pension funds and sovereign wealth authorities investment process to create platform for development.

“So, the committee has reported and identified potential road infrastructure, power, rail sectors that can be funded through this mechanism.

“They noted that this year’s budget for example has N169 billion for roads across the federation and is grossly inadequate but with this mechanism maybe up to N2 trillion can be accessed and leverage upon.

“The NEC commended the committee for the interim report and the subcommittee promised that early next year there will be final report  for the NEC to consider.”

Also speaking on the state of some critical national accounts,  Mrs. Ahmed gave details of how much the country has saved.

She also spoke on some financial transactions going on between the federal and state governments, speaking particularly of the Budget Support Facilities that the state governments obtained from the Federal Government, informing that deductions for repayment were going.

“Today the Ministry of Finance, Budget and National Planning reported to the 100th National Economic Council on the balances of some key accounts.

“For the Excess Crude Account, as at 19th November, 2019, we have a balance of $324,967,933.72. In the Stabilisation Account, as at 17th of December, 2019, we have a balance of N30, 479, 704,808. In the Natural Resource Fund, still at the same date, 17th of December, 2019, we have the balance of N88,283,218,114.40.

“Also, today we have an update to the Council on the repayment process for the Budget Support Facilities that was granted to the states, the current situation is that deductions are ongoing and remitances on these facilities are being made to the Central Bank.”

Sanwo-Olu, said the NEC sub-committee on security presented the report on security situation to the session.

The committee is chaired by Ekiti State governor Kayode Fayemi.

According to Sanwo-Olu, the Fayemi committee, which has the Inspector-General of Police, Mr Mohammed Adamu, and other heads of security agencies as members, reported that there was a reduction in proliferation of small arms as a result of the closure of the country’s land borders.

The committee also reported that states were advised to set up on zonal basis, security trust funds to help address security challenges.

“Community policing is also important as a means of engaging our youths and reducing youth unemployment in the country”, he added.

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