The Bayelsa Government, on Sunday, said that it received N27 billion and not N38 billion approved as refund by the Federal Government for federal projects executed by the state from 2005 to date.
The News Agency of Nigeria recalls that the Senate had, on Nov. 24, 2020, approved promissory notes and bond issuance worth N148.1 billion as refunds to Bayelsa, Rivers, Cross River, Osun and Ondo states, for executing federal projects.
Promissory notes and bonds are debt instruments, which one party promises in writing to pay a determinate sum of money to the other, either at a fixed or determinable future time, under specific terms and redeemable before maturity at a discount.
A breakdown of the refunds showed that Bayelsa got N38.4 billion, Cross River N18.4 billion, Ondo State N7.8 billion, Osun N 4.5 billion and River N78.9.
Gov Douye Diri, however, clarified that the state government was only in receipt of N27 billion in cash, while giving an update for November and December 2020.
The Technical Adviser, on Treasury and Accounts to the governor, Timipre Seipulo, explained on behalf of the governor that the debt instrument issued by the federal government had a tenor of between four to five years maturity.
He said that the refund was structured in such a way that benefiting states would have to wait for between four to five years, before they access the full amount of the refunds.
Seipulo further explained that for states that wanted their funds, it had to be discounted and as such the N27 billion announced by the government was the discounted amount from the N38 billion, representing a 71 per cent of the total value.