The Federal Government has approved the issuance of promissory notes for the settlement of N740 billion naira worth of debts owed local contractors.
The Minister of Finance, Mrs Kemi Adeosun, told State House correspondents after Wednesday’s Federal Executive Council meeting that debts owed GENCOS, DISCOs and state governments stood at N193.69bn.
“The Memorandum that the Council approved was for the issuance of a promissory note programme to settle inherited debts to local contractors and state governments on the part of Federal Government.
“These obligations had accrued prior to our coming into office and are across a number of sectors.
“We had pension liabilities, salaries some of which go back to 2006; unpaid salaries from 2012 to 2015; pensions to former Nigeria Airways staff from 2009, the Export Expansion Grant which was suspended in 2014; there are actually obligations on that between 2007 and 2014 when they were suspended.
“What the government has agreed to do is to issue a promissory note, which is effectively an IOU.
“We are going to issue IOUs to the contractors and to those who Federal Government is obligated.
“Those promissory notes would mature over the next 10 years.
“So basically what we are doing is solving a long-standing problem of contractor arrears,” she said.
