Only four states in Nigeria can pay salaries without borrowing according to a new report by BudgIT, a civil society organisation.
The report, State of State 2017, was launched on Last week, Thursday and released to the public on Friday same week.
“Important is states’ ability to meet their recurrent expenditure obligation with all revenue source — a test of prudent fiscal management. Kano, Katsina, Rivers and Lagos top that portion of the index.
“In effect, only four states could meet their recurrent expenditure obligation without resorting to borrowing or tapping donor funds and other extra-budgetary revenue sources.” The civil society stated.
According to BudgIT,: “Bonds issued by the states are usually assisted by Irrevocable Standing Payment Orders (ISPOs), which legally empower the accountant general of the federation (AGF) to withdraw sums due to debt holders from state governments’ revenue accounts with the federal government, including interest and capital repayments.”
In a related news, about 610 staff drawn from 34 local government areas of Katsina state have sued the state government to the National Industrial Court sitting in Kano over nonpayment of salaries for 19 months.
Joined as co-defendants in the case are the Katsina state’s Attorney General and commissioner for justice, commissioner for local government and chieftaincy affairs, state’s chairman of local government service commission as well as the chairman, state’s civil service commission.