Uche Usim, Abuja
A concerted effort to deepen transparency and accountability in the 36 States has been boosted by the World Bank with a release of $75 million to the National Steering Committee for the States Fiscal Transparency, Accountability and Sustainability (SFTAS).
Speaking at the inauguration of the SFTAS-Programme-for-Results committee, the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed said part of its functions will be to review the States’ performances with regards to how the money is spent.
She said: “The programme is financed with the loan of $750 million from the World Bank to support the states through the provision of performance-based grants.
From this amount, $700 million has been earmarked for the programme while the balance of $50 million is for financing of technical assistance to enable the States to achieve specified Disbursement Linked Indicators (DLIs) towards qualification for the grants.
Ahmed noted that “the DLIs are derived from the already established 22-Point Fiscal Sustainability Plan (FSP) by the Federal Government and the Open Government Partnership (OGP) commitments.”
She said the move was aimed at strengthening the desired fiscal reforms at the sub-national level and participation in the Programme is open to all states of the federation, including the Federal Capital Territory (FCT).
The minister also disclosed that the implementation of the programme has commenced with a fully-functional Programme Coordination Unit (PCU) domiciled in the Home Finance Department, Federal Ministry of Finance, Budget and National Planning.
The National Steering Committee (NSC) is expected to give strategic direction to the PCU and ensure the smooth implementation of the programme.
In his address, Permanent Secretary, Special Duties of the Federal Ministry of Finance, Mr. Aliyu Ahmed stated that the Federal Government introduced the Budget Support Facility (BSF) in the form of soft loans to enable the States finance their capital budget.
All the States he said participated in the programme, except Lagos State.
In order to realize the objectives of the BSF programme, releases to the States were based on their fulfillment of 22 Point Action Plan targeted at strengthening States’ fiscal transparency, as well as improving revenue generation and management of expenditure.
Given the progress recorded with BSF, the ministry in collaboration with the World Bank introduced the SFTAS Programme.
The 22 conditions under BSF, and parts of the Open Government Partnership (OGP) commitments, now form the basis of Disbursement Link Indicators (DLIs) under SFTAS Programme.
States are expected to achieve the DLIs to qualify for performance-based grant, under the SFTAS Programme.
The intriguing aspect of the performance-based grant is that the level of achievement of these indicators by a state determines the amount of the grant to be disbursed to it.