CCT: FG Seeks Additional $400m Loan For Support To 15 Million Households

The Federal Government has approached the World Bank for a new $400 million loan to support conditional cash transfers (CCT) to 15 million households, aiming to mitigate the impact of petrol subsidy removal on Nigerians.

This additional $400 million loan will increase the total amount borrowed from the World Bank for cash transfers to $1.2 billion, as an $800 million loan was previously secured for the same purpose.

In an Independence Day address on October 1, President Bola Tinubu announced the conditional cash transfer program to assist 15 million households affected by the subsidy removal, which has significantly raised the cost of living.

The President also revealed that the Federal Government would initiate monthly payments of N25,000 to 15 million households for three months, starting from October to December 2023.

The previous administration under President Muhammadu Buhari had obtained an $800 million loan from the International Bank for Reconstruction and Development (World Bank) to provide post-subsidy palliatives for over 50 million Nigerians. This loan was intended to be accessed by the succeeding administration.

In the October 1 broadcast, President Tinubu further announced the approval of a provisional N25,000 allowance for junior federal workers over the next six months. He stated that this decision followed negotiations with labor unions and other stakeholders in the business community to raise the federal minimum wage without causing excessive inflation.

However, in response to protests regarding the exclusion of other categories of workers and pensioners, and in light of the threat of a nationwide strike by organized labor, the government announced a provisional wage award of N35,000 for all treasury-paid Federal Government workers over the next six months, following further consultations with the leadership of the Nigeria Labour Congress and the Trade Union Congress.

A senior government official, who spoke anonymously due to the sensitivity of the issue, informed Sunday PUNCH that the Tinubu administration would fund the N35,000 cash award to civil servants by submitting a supplementary appropriation bill to the National Assembly.

The source clarified, “The government is financing the N35,000 wage increase for all federal civil servants without taking a loan. The loan of $800 million and the additional $400 million are specifically designated for the N25,000 monthly payments, extending for three months, to 15 million households through the conditional cash transfer program.”