FG Introduces $750m World Bank-assisted SABER Programme for States

* SFTAS to end in December

Ndubuisi Francis in Abuja

As the World Bank-assisted States Fiscal Transparency, Accountability and Sustainability (SFTAS) Programme-for-Results (PforR) designed to enthrone fiscal discipline, transparency and accountability at the sub-national level winds down in December, a $750 million State Action on Business Enabling Reforms (SABER) is to be established as a replacement, the federal government has revealed.

The Minister of Finance and Coordinating Minister of the Economy, Mr. Yemi Edun, who made the disclosure, expressed the federal government’s commitment to improve fiscal reforms at the sub-national level by working assiduously to sustain collaboration with the states and international development partners through programmes such as the World Bank-assisted SFTAS Programme, which he said, had brought a great deal of reforms that helped to strengthen state governments’ approach to governance and public finance management.

The minister stated that SABER, which is coming as a successor programme to SFTAS would effectively run from 2023 to 2025.
The $1.5 billion World Bank-assisted SFTAS, which was conceived by the federal government, and approved by the multilateral institution in June 2018, took effect in May 2019, to nudge states into imbibing fiscal transparency, accountability and sustainability.

Speaking at a retreat with the theme, “Creating a Resilient Economy through Diversification of the Nation’s Revenue,” organised by the Federation Account Allocation Committee (FAAC) in Asaba, Delta State, Edun, who was represented by the Permanent Secretary, Special Duties in the finance ministry, Mr. Okokon Udo, observed that the $1.5 billion SFTAS, which ends in December 2023, brought about remarkable achievements recorded by all the 36 states in key result areas.

He listed the result areas as fiscal transparency and accountability, domestic revenue mobilisation, efficiency of public expenditures and debt sustainability.
“We hope and encourage the sub-nationals to continue with these laudable reforms beyond the SFTAS period,” Edun said.
He disclosed that as SFTAS comes to an end in December, the federal government in collaboration with the World Bank came up with SABER, which would effectively run between 2023 and 2025.

“This programme aims at improving the business enabling environment of Nigeria’s states. Other intervention programmes from the World Bank and other International organisations would continue unabated,” Edun said.
According to him, the $750 million SABER Programme, which is currently awaiting the approval of an abridged External Borrowing Plan by the National Assembly, seeks to incentivise and strengthen the implementation of business enabling reforms covering land administration, the regulatory framework for private investment in fiber optic infrastructure, public-private partnership and investment promotion frameworks, tax administration and the business enabling regulatory environment.

Speaking in the same vein, the World Bank Senior Economist, Mr. Samer Matta, congratulated the federal and states governments for the fiscal reforms initiated under the SFTAS Programme, calling for the sustainability of results especially by new administrations in the states through adhering to the SFTAS Charter signed by governors in August 2022, committing to continued achievement.

Matta, attributed the success of the SFTAS programme to a number of factors which included the deployment of simple but substantive eligibility criteria annually to open the programme to all states for participation in any year, but ensure that minimum performance standard for receiving grants.
Others include making technical assistance available irrespective of meeting Eligibility Criteria (EC) and level of achievement of Disbursement Linked Results (DLIs); robust and credible results verification process; use of performance- based criteria that is non-negotiable and consistently applied; transparency of results encouraging virtuous peer competition, and active peer learning among states facilitated by the Nigerian Governors’ Forum (NGF) as well as the utilisation of state-level platforms for engagement at multiple political and technical levels.
He further noted that the implementation of SFTAS reforms had enhanced the perception of states as having sound fiscal practices, a key factor for capital markets.

This improvement, he noted, was bolstered by the availability of more comprehensive and improved fiscal data, facilitating a more informed, evidence-based dialogue.
Also speaking, the World Bank Task Team Leader for SABER, Ms. Bertine Kamphuis exuded optimism that the SFTAS ideals would be sustained even in the absence of further incentives given the fact that SABER is a natural component of the sustainability strategy as it will continue to use two SFTAS Eligibility Criteria.
These are the timely publication of National Chart of Account compliant budgets and the timely publication of IPSAS-compliant audited financial statements, as well as elevate the SFTAS result on the timely publication of a debt sustainability report to eligibility criteria.