• Sunday, December 10, 2023
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World Bank releases $300million in palliatives loans

The World Bank has set the wheels in motion by releasing funds from the $800 million budgeted for Nigeria’s much-needed National Social Safety Net Program-Scale Up.

According to insights from The PUNCH, approximately $299.99 million has already made its way into Nigeria’s coffers as part of this initiative, which is a significant chunk that makes up about 37.5 percent of the total loan.

However, there’s still a substantial balance of $442.88 million eagerly awaited to further bolster this critical programme.

This safety net, a conditional cash transfer, is tailor-made to cushion the impact on impoverished and vulnerable Nigerians who have felt the weight of recent governmental decisions, such as the removal of the fuel subsidy.

In a move to directly address the plight of those hardest hit, President Bola Tinubu stepped up and officially unveiled a conditional cash transfer programme in October 2023.

The initiative sets its sights on providing relief to a staggering 15 million households across the nation, promising a lifeline of N75,000 within a span of three months.

But that’s not all. As this much-anticipated programme gains momentum, the federal government is actively seeking the expertise of a consulting firm to lend a hand in enhancing the system behind this cash transfer mechanism.

Read also:FG approves $3.45bn World Bank loan to boost power, other sectors

This upgrade aims not just for efficiency but also to ensure that the assistance reaches those who need it most, all in a timely and impactful manner.

The document partly read, “The Federal Republic of Nigeria has received financing from the World Bank towards the cost of the National Cash Transfer Office under the Federal Ministry of Humanitarian Affairs and Poverty Alleviation and implementing agency of the client and intends to apply part of the proceeds towards payments under the contract for Upgrade of MIS for NASSP-SU.”

“The consulting services (“the Upgrade of MIS for NASSP-SU”) include carrying out the development, implementation, deployment, and maintenance of a user-friendly, interactive, web-based MIS System to support the activities of NASSP-SU of the Federal Republic of Nigeria for effective and efficient delivery of programme benefits to the poor and vulnerable.

“For the estimated level of effort (professional staff months) as contained in the TOR, for an implementation period of 120 days plus warranty and after-sales service, the expected start date of assignment should be in the next three months from the advert date.”

This update becomes imperative as the National Economic Council takes a firm stance, opting not to rely on the social register from the previous Muhammadu Buhari administration due to concerns about its credibility in steering the conditional cash transfer programme.

In scrutinising the financing agreement document between the Federal Republic of Nigeria and the World Bank’s International Development Association for the National Social Safety Net Program-Scale Up, it’s been unveiled that repayments will occur in staggered installments.

The payment timeline delineates the first installment’s due date as January 15, 2027, with the final payment expected on July 15, 2051.

Read also:Our mission is to create a world free of poverty — World Bank

Within this financial arrangement, the $800 million loan secured by the Federal Government entails a maximum commitment charge rate and service charge.

Specifically, it imposes a commitment charge of one-half of one percent annually on the Unwithdrawn Financing Balance and a service charge of three-fourths of one percent annually on the withdrawn credit balance.

Additionally, the document reveals an interest charge of one and a quarter percent annually on the withdrawn credit balance.

Moreover, the document sheds light on an evolving payment structure that involves a percentage of the principal amount alongside other charges.

This payment scheme indicates a progressive increase over time, starting at 1.65 percent of the principal amount for the initial payment and reaching 3.40 percent for the ultimate payment.