Lagos Assembly Approves N200bn Bond, Backs State Govt On FAAC Funding Plan

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The Lagos State House of Assembly has approved the state government’s request to participate in the Federation Account Allocation Committee (FAAC) Receivables Discounting Programme.
The House also approved the proposed issuance of a ₦200 billion bond under the state’s existing ₦1 trillion Debt and Hybrid Instruments Issuance Programme.
The approvals followed the presentation of a report by the Joint Committee on Economic Planning and Budget and Finance, chaired by Hon. Lukmon Olumoh, during plenary on Thursday.
Presenting the report, Olumoh said the Commissioner for Finance, Mr. Abayomi Oluyomi, informed the committee that the Federal Government introduced the FAAC Receivables Discounting Programme, following a proposal by the Nigeria Governors’ Forum, to enable states access funding for critical infrastructure projects.
He explained that participating states would execute an Irrevocable Standing Payment Order (ISPO), allowing the Accountant-General of the Federation to deduct agreed amounts from their monthly FAAC allocations over an 11-month period. The deductions would be paid into a sinking fund managed by the Debt Management Office and domiciled with the Central Bank of Nigeria.
Olumoh said the programme would provide Lagos State with immediate liquidity to finance priority infrastructure and capital projects, including legislative quarters and other strategic developments. He added that the committee considered the proposal beneficial to the state’s development objectives.

Speaking during deliberations, Chairman of the House Committee on Waterfront Infrastructure, Hon. Gbolahan Yishawu, described the initiative as an advance payment under the ISPO arrangement that would strengthen the state’s revenue profile. He noted that the facility attracts no interest but urged the government to clearly identify the projects to be funded with the proceeds.
Speaker of the House, Mudashiru Obasa, backed the borrowing plan, saying responsible borrowing for capital projects was necessary for infrastructure development. He stressed that the use of the funds would remain subject to legislative oversight.
The lawmakers unanimously adopted the committee’s report, approving both the FAAC Receivables Discounting Programme and the ₦200 billion bond issuance.