The Federal Executive Council FEC, approves N26bn to pay off MDAs’ debts to Discos

The Federal Executive Council (FEC) meeting presided over by President Muhammadu Buhari, Wednesday, approved the sum of N25,994 billion for Distribution Companies (Discos), to offset some of the debts owed by Ministries Departments and Agencies (MDAs). 

The Council approved the verified sum of N25.994 billions for Discos out of the claims of N67.41 billions, leaving a differential of about N41 billion yet to be verified. 

The Federal Government will deduct the sum from the N500 billion the Discos owed the  Nigerian Bulk Electricity Trader (NBET), a wholly Federal Government owned subsidiary company. 

Briefing State House correspondents at the end of the three and half hour meeting, the Minister of Power, Works and Housing, Babatunde Fashola, alongside the Ministers of Information, Lai Mohammed and Agriculture, Audu Ogbe, said the debts, yet to be verified, were those of states,  local government areas and some international organisations ascribed to the Federal Government. 

“We presented a memorandum to FEC to approve the verified sum of monies being debts owed by MDAs to distribution companies for electricity supplied to them. Since the beginning of this administration, claims of debts by government to Discos have been a matter of concern especially in the light of liquidity issues. 

“We had committed that those figures would be verified and the verified sums, government would pay. We have concluded the verification and we now asked council to approve the verified sum of N25.994 billion owed by MDAs of the Federal Government to be paid to the Discos out of the claims of N67.41 billion. So, there is a differential of about N41 billion.

“That differential arises first because some of the claims do not belong to the Federal Government. Some are owed by states and local governments, while some belong to public international organisations and were classified as government debts.

So, there are more verifications going on and undertaking at states and local governments which we have discovered at the National Council on Power about a week ago. And this is important so that government can demonstrate its support for the private sector by paying its own debts so that the sector can do what they do well.

“Government has also approved that this amount that has been quantified be set off against the amount owed by the DISCOS to Nigerian Bulk Electricity Trader (NBET), a 100 per cent federal government owned subsidiary company. They also owe government for their unremitted collections for energy they have taken and have not remitted. They are owing about N500 billion to government,” he said.

Meanwhile, the Presidency has begun investigations into the embarrassing rejection of 72 tonnes of yams exported to the United States in June.

Despite the euphoria that greeted the  historic export that was officially flagged off by the Vice President, Yemi Osinbajo in Lagos,  the yams were found to be rotten upon arrival in the US.

Minister of Agriculture, Audu Ogbeh, said: “We were mandated to brief you about development in the agric sector. One of the developments about the consignment of yams which was exported from here to the United States and which, according to the reports we have today, was found to be of poor quality. The ministry will investigate because the  Ministry is not an exporter, the exporters are private people.

“We will be investigating both the company that exported it and ask our quarantine department to check  and find out why such a consignment left here,”he said.

Ogbeh, also assured that the price of rice in Nigeria will drastically fall within the next one month.

The minister said the government had been concerned about the high cost of rice which he described as the most consumed commodity in Nigeria. The trend, he added, resulted in the recent meetings of both the rice growers and millers during which he said both parties resolved to crash the price of price in the next four weeks.

According to him, both the rice growers and millers had agreed that the price of paddy – raw  and unprocessed rice in the farm – would be reduced to a cost that will be easily affordable by rice millers who will in turn sell the milled rice at a competitive price that will be within the reach of average consumers.

He said given this development, the price of locally consumed rice would become as low as that of imported or smuggled rice. This development is expected to make rice import or smuggling henceforth unattractive.

He said: “The second is that in the last two days, rice growers and millers have been meeting. We are very concerned about the price of rice which is the most consumed commodity in Nigeria. The two have agreed to the plans we have been pursuing to arrive at a certain price which makes the price of paddy stabilize at a point where the milers can take the rice, mill it and put it in the market at competitive prices almost as low in price as the foreign rice including the smuggled ones is going for. That means that in the next one month, the price of rice will become reasonable and the cost of rice would have reduced substantially.”

Ogbeh also said a bill meant to repeal Export Prohibition Act which prohibits the export of some locally produced items such as yam, rice, among others, to enable the country export such products and grow the economy is already before the National Assembly.