Minister of budget and economic planning Atiku Bagudu has urged 36 states of the federation and the Federal Capital Territory to hasten efforts in accessing the balance of the $750 million World Bank-supported COVID-19 Action for Recovery and Economic Stimulus (NG-CARES) programme.
The NG-CARES programme is a multi-sectoral initiative designed to provide immediate relief to the vulnerable and poor Nigerians, smallholder farmers and MSEs who were adversely affected by the COVID-19 pandemic. The objective is to protect the livelihoods and food security of poor and vulnerable families and facilitate the recovery of local economic activity in all participating states across Nigeria. The interventions were included to choose shocks like flooding, natural disasters, impact of economic policies that can trigger social unrest and worsening poverty among the poor and vulnerable Nigerians.
Speaking at the inauguration of the federal care steering committee for the programme on Tuesday, Bagudu also disclosed that $8 billion World Bank concession loan at less than two percent was yet to be accessed by the states and FCT while expressing concern over the poor attitude of the sub-nationals to accessing development and economic empowerment funds.
“The challenge we have is low disbursement. Because from the $15 billion portfolio, about $8 billion is not disbursed. So, if we can accelerate it, that is a source of funding to the federal and state governments,” he said, adding that Nigeria has reached the limit of borrowing from the less than two percent interest loan facility of the World Bank. He said the government needs to quickly disburse the funds to be able to access such low-interest facilities of the global financial institution.
The World Bank representative in the NG-CARES committee, Lire Ersado, said the fact that the programme is owned by the states while the World Bank provides the incentives makes it easy for implementation. He said NG-CARES caters for the different and diverse needs of the states based on their needs. Under the scheme, each state chooses what works for it, including adverse effects of subsidy reforms and effects of flooding while focusing on the three result areas: social transfer and livelihood, agriculture and support to SMEs, and 11 disbursement-linked indicators.
He stressed the need to ensure the sustainability of the programme while pledging the readiness of the World Bank to give Nigeria more financial and technical support.
Going forward, he said the programme needs to be nurtured and expanded because the need to care for the poor and vulnerable needs to be upheld.
“It’s something that should be supported. WB is ready to provide additional support and technical services…to continue to build on its achievements for the last 3 years it has been in existence.”
The programme cost is $750 million with the implementation period of three years (2021-2024). Each State is allocated $20m ex-ante, $15m to FCT and $15 million for the Federal CARES Support Unit (FCSU).
The total earnings by states and FCT under the Programme is about $420.48 million, equivalent to 210 billion Naira which represents 56 percent of the total credit as of 31st December 2023. $329.52 million is yet to be disbursed under the programme for the result scheme. The programme closing date was extended by 12 Months in 2023. The new closing date is 30th June, 2024.
National coordinator of NG-CARES, Abdulkarim Obaje disclosed that 1,656,731 people and 44,196 firms have benefited from the World Bank-supported programme across the federation.
Obaje called for the sustainability of programme structure in the states and FCT to be enhanced through continuous training and funding of the state government shock response mechanism using the NG-CARES PforR.
He also advocated for a change of name from Nigeria Covid-19 Action for Recovery and Economic Stimulus (NG-CARES) programme to “Nigeria Community Action for Recovery and Economic Stimulus (NG-CARES) programme, adding that current state governors need to be galvanised for the release of funds for the implementation of the NG-CARES programme using PforR mechanism.
“The Federal Team supported by the World Bank Task Team should conduct strong advocacy to State key stakeholders to understand the principles of the Programme for Results (PforR) financing instrument and the value added of the NG-CARES programme for supporting the poor and vulnerable. Emphasis will be on poor-performing States for the advocacy exercise,” he suggested.