FG approves release of N2.7tn debts owed contractors, pensioners to enliven economy
One of the most cheerful news for the economy from Wednesday’s Federal Executive Council (FEC) can be said to be the rare approval handed down to proposal presented by the Ministry of Finance to offset accumulated Federal Government’s N2.7tn debts.
Before now, both contractors and pensioners had been gnashing their teeth due to massive debts incurred by the federal government over the years.
Explaining the development, the Minister of Finance, Mrs. Kemi Adeosun, said the obligations that accumulated over the last two decades would be paid through bond and promissory note issuance.
According to her, part of the inherited and long outstanding Federal Government’s obligations included those being owed state governments, employees and contractors.
However, there is still another hurdle to pass before the release of the money which may come in tranches.
She revealed that the council will first seek approval from the National Assembly ahead of implementation.
Some of the debts were owed strategic sectors of the economy including state governments, oil marketers, power generation and distribution companies, suppliers, and contractors by government’s parastatals and agencies, payments due under the Export Expansion Grant, outstanding judgment balances as well as pension and other benefits to Federal Government employees. According to her, many of the debts dated as far back as 1994.
