President Buhari seeks Senate’s approval to pay Kogi State N10.69bn promissory note

By Tola Akinmutimi, in Abuja

President Muhammadu Buhari on Tuesday formally requested for Senate’ approval of N10.069 billion Promissory Note for Kogi State.

The president also forwarded the Deep Offshore and Inland Basin Production Sharing Contracts (PSC) Amendment Bill 2019 to the upper chamber of the National Assembly for urgent consideration and passage.

The requests were expressed in a letter he sent to the Senate and was  read at plenary by Senate President Ahmad Lawan.

Specifically, he stated that the N10.069 billion worth Promissory Note was required to offset costs incurred by the Kogi State Government on some federal projects executed by it.

President Buhari recalled that 24 out of 25 state governments had received the approval of the National Assembly for the settlement of claims on projects executed on behalf of the Federal Government.

The letter reads: “The distinguished Senate President would recall that, based on my request for the resolution of the National Assembly approving the establishment of a promissory note programme and a bond issuance to settle inherited local debts and contractual obligations of the federal government, the 8th National Assembly passed resolutions approving the issuance of promissory notes to refund state governments for projects executed on behalf of the federal government.

“The resolutions of the 8th Assembly were conveyed through three different letters from the Clerk of the National Assembly as follows: Letter dated July 27, 2018 and referenced NASS/CAN/106/Vol.10/277 which approved the Issuance of Promissory notes to 21 states.

“Letter dated January 29, 2019 and referenced NASS/CAN/106/Vol.11/004 which approved the Issuance of Promissory Notes to Delta and Taraba States; and letter dated May 23, 2019 and referenced NASS/CAN/106/Vol.11/164 which approved the Issuance of Promissory Notes to Bauchi State.”

“The three Resolutions approved the Issuance of Promissory Notes to 24 out of the 25 State Governments requested, and the only State for which approval has not been given is Kogi State, with an outstanding claim of N10,069,692,410.15 (Ten billion, Sixty-Nine million, Six Hundred and Ninety-Two thousand, Four Hundred and Ten Naira, Fifteen Kobo).

“The Senate may wish to note that, subsequent to Resolutions of the National Assembly approving the refunds to the 24 State Governments, the Federal Government has issued Promissory Notes to all the approved States for the settlement of their claims.

“Accordingly, the Senate is hereby requested to kindly approve, the Issuance of a Promissory Note in the sum of N10, 069,692,410.15 as refund to Kogi State Government for Projects executed on behalf of the Federal Government”, the President stated.

As expected, the Senate President, following the reading at plenary, referred the President’s request to the Senate Committee on Local and Foreign Debts for legislative work and the committee is expected to report back at plenary in two weeks.

On the PSC (Amendment) Bill 2019 letter which was read also at plenary, the President stated that the Bill was forwarded for passage such that its amended provisions would reflect the current fiscal realities in the oil and gas sector.

He pointed out that the bill’s passage had the potential of boosting government’s revenue  and therefore help in the funding of the N10.33trillion projected expenditure in the 2020 budget.

The Minister of Finance, Budget and Planning, Mrs. Zainab Ahmed, had yesterday hinted that the President would send the bill to the National Assembly in view of the criticality of its passage to ongoing efforts to raise more revenues in order to minimize the funding gap in the fiscal 2020 year.