The apex bank in Nigeria, Central Bank of Nigeria, CBN has affirmed that it will sustain its Ways and Means Advances to the federal government at a 5 per cent limit for the fiscal years 2024-2025.
This is contrary to a bill passed by the National Assembly which raised the maximum borrowing percentage in the Act from five per cent to ten per cent.
This information is based on the Monetary, Credit, Foreign Trade, and Exchange Policy Guidelines for the Fiscal Years 2024-2025, published by the CBN on Tuesday.
The guideline is in line with the MTFF, under which the apex Bank will manage expectations, implement time-consistent policies, address shocks to support the ongoing recovery, and ensure the country’s macroeconomic stability.
The document reads:
“Ways and Means Advances shall continue to be available to the Federal Government to finance deficits in its budgetary operations to a maximum of 5.0 per cent of the previous year’s actual collected revenue.
Such advances shall be liquidated as soon as possible and shall in any event be repayable at the end of the year in which it was granted.”
“Consistent with the banking arrangement of Treasury Single Account, Ways and Means Advances would now be determined after recognising the sub-accounts of the various MDAs, which are now linked to the Consolidated Revenue Fund to arrive at the FGN consolidated cash position.
This would continue in the 2024/2025 fiscal years.”
