The federal Government has agreed with World Bank on the State Fiscal Transparency, Accountability and Sustainability (SFTAS) for Results.

The SFTASProgramme Development objective is to strengthen the Fiscal Transparency, Accountability and Sustainability in Nigeria States.

The SFTAS programme provides performance based grants and Technical assistance in States to implement the 22-point Fiscal Sustainability Plan (FSP) and the open Government Partnership (OGP) commitments over 4 years (2018-2021).

The SFTAS programme aims to significantly improve outcomes of participating States in 4 key result areas (KRA’s):

  • Increased Fiscal Transparency and Accountability
  • Strengthen Domestic Revenue Mobilization
  • Increase Efficiency in public Expenditure
  • Strengthen Debt sustainability

State Governors endorsed the programme at the National Economic Council on 22nd March, 2018 and approved by the World Bank at the end of June 2018.

All 36 States submitted written expression of interest to participate in the programme.

The World Bank Board approved IDA credit to the Nigeria Government of USD 750 million on 27th June, 2018.

Scope and Development Objectives

SFTAS support States to implement the 22 – point Fiscal Sustainability Plan and the Open Government Partnership Agenda to Strengthen the Fiscal transparency, accountability and sustainability of the Nigeria's States.

Programme Size and Duration: Total envelop of $750 million over 2018-2022 and have two (2) components.

Component One:

  • Total USD $700 million available.
  • 4 set of annual performance based grants to States based an individual State performance.

Component Two:

  • Total USD $50 million available.
  • In-kind capacity building to States to help them strengthen their performance.
  • Available to all States, based on need and demand, not performance.
  • Capacity building activities to be provided by Nigeria Governors Forum, public service institute of Nigeria, Federal Debt management office of OGP secretariat.

How to access the annual performance – based grants. State have to do the following:

  • In years 3 and 4, States are required to align with International best practices National Chart of Account International Public sector accounting standard (NCOA and IPSAS).
  • Different entry points to accommodate different starting points: States not achieving the EC in year 1 wont access year 1 performance grant but can joint the performance in year 2 & 3.
  • Eligibility Criteria = Published Annual State Budget and Audited Financial Statement.
  • To achieve Disbursement-linked indicators.
  • There are (4) key result areas and (9) Disbursement-linked indicators.

    Result Area 1: Increase Fiscal Transparency and Accountability.
    DLI 1 - Improved Financial reporting and Budget reliability.
    DLI 2 - Increased openness and citizens engagement in the budget process.

    Result Area 2:
    DLI 3 - Improved cash management and reduced revenue leakages through implementation of TSA.
    DLI 4 - Strengthened Internally Generated Revenue (IGR) collection.

    Result Area 3: Increase Efficiency in public Expenditure.
    DLI 5 - Biometric registration and bank verification number (BVN) used to reduce payroll fraud.
    DLI 6 - Improved procurement practices for increased transparency and value for money.

    Result Area 4: Strengthen debt sustainability.
    DLI 7 - Strengthened public debt management and fiscal responsibility framework.
    DLI 8 - Improved clearance/reduction of stock of domestic expenditure arrears.
    DLI 9 - Improved debt sustainability.

  • Achievement of each DLI is valued between $o.3 to $2 million for State per year.
  • Total annual disbursement to each State is the proportion to how many DLIS the State achieve that year.
  • Verification to be conducted by the office of the Auditor General of the Federation and an external audit firm.
  • Annual performance result will be published to promote transparency and peer learning.
  • The institution structure and current position has been forwarded for further directives.
  • Challenges

    • Inadequate manpower
    • Inadequate office accommodation
    • Funding
    • Capacity building
    • Shortage of Office equipment
    • Inadequate Motor vehicles
    • Government counterpart cash contribution (GCCC)
    • Budget indiscipline
    • Lack of Support and Commitment from the stakeholders in making the newly engaged Central Budget Management System (CBMS) of the Epicor.

    Way Forward

    • Recruitment/Deployment of qualified manpower.
    • Construction of additional block of office accommodation.
    • Timely release of funds.
    • Training and re-training of Staff.
    • Provision of office equipment.
    • Provision of additional Motor vehicles/cycles .
    • Timely release of Government Counterpart Cash Contribution (GCCC)
    • Enforcement of Budget compliance.
    • CBMS Epicor Project; State should be task with the responsibility of owing up to what is expected of them.