President Muhammadu Buhari has asked state governors to use at least 25 percent of the refunds made to them from excess deductions for external debt service to pay outstanding workers salaries and entitlements .
Buhari recently approved N552.74bn to be paid in batches to all the states that are owed, a statement by his Senior Special Assistant on Media and Publicity, Garba Shehu said on Thursday.
The first batch of the 25 per cent of the approved sums is expected this weekend week ends.Many of the 33 states affected had claimed they were over-deducted for external debt service between 1995 and 2002.
Garba said when Buhari assumed office last year, he declared an emergency on unpaid salaries, following the discovery that 27 out of the 36 states had fallen behind in the payments to their workers, in some cases for up to a year.
“Following this, a bailout loan was issued to the states twice, with a first batch of about N300bn given to them in 2015 in the form of soft loans.
“The administration also got the Debt Management Office to restructure their commercial loans of over N660bn and extended the life span of the loans.
“Because this did not succeed in pulling many of the states out of distress, the Federal government this year gave out a further N90bn to 22 states as yet another bailout loans under very stringent conditions.
“President Buhari is of the opinion that the payment of salaries and pensions must be given priority to save both serving and retired workers and their families from distress.”