Two claims made by Edo State Governor Godwin Obaseki last week were yesterday punctured by the Federal Government.
Finance Minister Mrs. Zainab Ahmed said the government neither padded the Federation Account revenue nor exceeded the debt to Gross Domestic Product (GDP) ratio.
Speaking at the Edo Transition Committee Stakeholders’ Engagement last Thursday, Obaseki claimed that the Federal Government used quantitative easing to add N60 billion to the March revenue before being shared by the Federation Account Allocation Committee (FAAC).
He also alleged that the Federal Government is borrowing without a sustainable plan to sort out the debt load.
In the event that government needs money, or funds to finance its various activities, it can resort to quantitative easing, or monetary policy instrument whereby the central bank would purchase bonds, or any other financial assets and inject the money into the economy, or make such resources available to the government so as to expand and drive economic activities in the needed sectors.
Speaking to State House correspondents, the minister said distributions at FAAC were revenues from various federal agencies.
“The issue that has been raised by the Edo State Governor, for me, is very sad because it is not a fact. What we distribute at FAAC is a revenue that is generated and in fact distributed revenue is a public information. We publish it.
“So, it’s revenue generated by the FIRS, the Customs and the NNPC, that we distribute at FAAC. It is not true”, she said.
Speaking to the issue of borrowing without a repayment plan, Mrs. Ahmed said the nation’s debt profile remains within manageable realms. She said the plan for the country is basically to improve its revenue generation in order to take care of both debt servicing and running of government.
“On the issue of the borrowing, the Nigerian debt is still within sustainable limits. What we need to do, as I have said several times, is to improve our revenue to enhance our capacity to service, not only our debt obligations, but to service the needs of running government on day to day basis.
“So our debt, currently at about 23 per cent to GDP, is at a very sustainable level. You can look at all the reports that you see from multilateral institutions, those facts are stated”, she added.
Last night, a source close to the governor who craved anonymity said the onus is on the Federal Government to disprove Obaseki’s claim.
The source added: “He will not want to take up issues with the Federal Government since they are reacting to what he said.
“The truth is known to the Federal Government. It is for the government to clarify it. It is not for the governor to revalidate what he said.”
