The cash crunch that gripped the Nigerian economy appears to be worsening by the day as the Federal Ministry of Finance has failed to release the second tranche of the N350 billion projected to be part of its expansive fiscal spending to reflate the economy.
Two months after the first tranche of N280 billion was released to the Minis-tries, Departments and Agencies (MDAs) to fund ongoing capital projects, there has been no further injection of funds into the system. New Telegraph investigations showed that the initial plan of the government was to release the sum of N350 billion every quarter to ensure that there were sufficient funds to keep the capital projects running, but this plan has been thwarted due to dwindling revenue.
Secretary to the Government of the Federation (SGF), Babachir David Lawal, last week declared that the Federal Government would not be able to fully implement the N6.06 trillion 2016 budget because the revenues of the government had dropped by over 50 per cent contrary to projections.
Apart from the global crash in the price of crude oil, Nigeria’s main foreign exchange earner, the economic situation has become further worsened by the activities of the Niger Delta Avengers and other militant groups who have sustained a campaign of vandalism on strategic oil installations, thereby impeding oil exploration and production in the region.
New Telegraph reliably gathered that the non-release of funds was having a devastating impact on the MDAs, as they are barely able to pay salaries while every other obligation, particularly execution of capital projects, has been put on hold.
The implication is that in the Ministry of Power, Works and Housing, capital projects worth N422.96 billion have been stalled due to lack of funds. This stagnation has affected over 40 projects for the construction of roads and bridges valued at N132.4 billion, N9.2 billion worth of power projects and N35.6 billion worth of projects meant for the construction of 1,973 blocks of 7,068 housing units in the six geo-political zones and the Federal Capital Territory.
In the Ministry of Transportation, five railway projects valued at N150 billion has also been stalled while capital projects valued at N5.42 billion have been brought to a halt in the Ministry of Agriculture and Rural Development. Similarly, capital projects valued at N13.9 billion and N3.2 billion have been stalled in the Ministries of Health and Education respectively.
New Telegraph learnt from reliable sources that the MDAs are currently frustrated and are even scared of advertising for jobs because they know there are no funds to execute them. “The reality is that this government may find it difficult to initiate the process of executing any project this year.