Oyo Assembly approves N14.2bn FG bailout for salaries

The Oyo State House of Assembly has approved the application of the state government to approach the Federal Government for a N14.16 billion bailout fund.

The approval came up at an emergency plenary session of the Assembly yesterday, presided over by the Speaker, Hon. Michael Adeyemo.

The speaker opined that the bailout, which would be given by the Federal Government in addition to the monthly allocation, was strictly meant for the payment of workers' salary in the state.

Adeyemo said the approval of the legislature was one of the conditions spelt out by the Federal Government to states facing severe financial difficulties.

He said from the bailout fund totalling N14.16 billion, a sum of N1.39 billion would be paid monthly for the first three months, while N1.11 billion would be paid monthly in the subsequent nine months.

The speaker said the bailout fund would be paid back to the Federal Government by the state with nine per cent accrued over a period of one year.

He said, however, that the Federal Government had given a year suspension before the commencement of the loan payment.

In his words: 'Federal Government has restricted states from getting loan facilities from commercial banks partly due to its high interest rates. The government then decided to provide the bailout in form of a loan.

'The repayment will not start until after a year moratorium by which time, hopefully, the state would have become economically viable,' he noted.