Salary Backlog: Kogi, Benue, Bayelsa Lead Defaulting States – NLC

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Ibrahim Apekhade Yusuf and Tony Akowe in this report focuses searchlight on the growing level of insolvency of some state governments unable to pay salaries as and when due. 

Besides working at blue-chip companies, banks, the oil and gas sector, the civil service was one place a lot of people gravitated to in the distant past because it was where they literally got a meal ticket to a guaranteed future with prompt payment of salaries, pensions and gratuities at the zenith of their careers. But not anymore. These days, the received wisdom out there is that getting paid salaries as a civil servant is a privilege and not a right.

The implication is that many civil servants are suffering a lot of privations more than they are willing to admit.

Why many are suffering in silence, some have had to go extreme mile to err their grievances. A case in point is the recent sad event of a top civil servant in the Kogi State Civil Service, Mr Edward Soje who allegedly committed suicide by hanging himself on a tree in Lokoja, the state capital.

The dangling body of Soje was found on a tree behind the mammy market at the Maigumeri barracks, the Nigeria Army Command Record.

The 54-year-old civil servant reportedly took his life barely 10 days after his wife of 17 years gave birth to a set of male triplets in a private hospital in Abuja. The couple had been childless before then.

Soje, a Grade Level 16 Officer in the Kogi State Teaching Service Commission, was being owed 11 months’ salary arrears as at the time he took his life.

Majority of the workers who have not been bold enough to toe Soje’s path are nonetheless melancholic.

There have been tales of woes from all and sundry with many civil servants condemned to penury as a result of being owed backlogs of salaries.

Dozier of states defaulting in salaries

Save for a few states, majority of others are neck deep in debts and thus are unable to pay their salaries.

BudgIT Nigeria, a civil society organisation gave fresh insights on the state of insolvency across the states.

BudgIT’s Lead Partner, Oluseun Onigbinde informed that the total debt profile of states from both internal and external borrowing has increased from N3.03 trillion in 2015 to N3.89 trillion in 2016.

Onigbinde who spoke with our correspondent at the weekend made reference to the organisation’s State of State report which was released in Abuja, recently.

Onigbinde expressed worries over the increasing debt profile of states, especially their inability to meet their recurrent expenditure as well as generate revenues.

He said the high debt profile had made it difficult for most states to meet their recurrent expenditure obligations.

Citing the report, Onigbinde said: “Total debt profile of states in 2015 and 2016 was N3.03tn and N3.89tn respectively. Lagos state’s total debt stock rose from the 2014 level of N500.8bn to N734.7bn in 2016 accounting for 24.2 percent of the total debt stock of the state governments.

“Many state governments are confronted by rapidly rising budget deficits as they struggle to pay salaries and meet contractual obligations and overheads due to a dip in oil price from its peak price of about $140 per barrel to about $56 per barrel.”

He urged state governments to expand their internally generated revenue while cutting down on their debt accumulation.

Onigbinde also called on the state governments to cut their “unreasonable” overheads bill while freeing up more spending for social infrastructure.

State governments, he advised, need to tremendously embrace a high level of transparency and accountability, develop workable economic plans, expand their internally generated revenue (IGR) base and cut down on debt accumulation without a concrete repayment plan.

But how did the country get to this past?

The devil is in the details

The Nation findings revealed that the issue of unpaid salaries started with about 18 states with liabilities ranging from two to 21 months. Top on this list, The Nation investigation revealed include Benue, Kogi, Bayelsa, Ekiti, Imo, Ondo , Abia, Oyo  states respectively.

Confirming this development, Comrade Ayuba Wabba, the NLC president in an exclusive interview with our correspondent gave a bird’s eye view of the general state of insolvency across the states of the federation.

According to him, “The worst case scenario at the moment is not more than six. Those are the states we are now trying to give more priority because other states have some level of arrangement with their workers to continue to pay and they also have a Standing Committee that will always look at the challenge as they arise. They have also worked to improve their internally generated revenue. Importantly, there is a transparent process where whatever comes in, priority will be given to the payment of workers’ salaries.

“There are states where we have major problems. Last week, we were in Benue because they have a huge liability. What we tried to do there is to see what we get in the interim for the workers and pensioners to stabilise them while working out modalities on how these liabilities can be paid. We reached an understanding that two months salaries and pensions should be paid immediately across board, including primary school teachers, local government workers, civil servants, pensioners and all.”

Kogi state, the NLC boss disclosed is particularly troubling. “In Kogi, which is the worst case scenario presently, you have about three categories of workers. You have those with three months’ salary arrears which constitute about 40 percent. We have those with arrears of between five to 18 months which constitute another 40 percent and then, you have about 20 percent with liability of between five to 21 months. The same applies to pensioners. That is the scenario we have presently in Kogi and that is why we say it is the worst case scenario because in other states, all the workers are on the same page.”

Pressed further, he said, Ekiti, owes between five and eight months between the state and local governments workers while Bayelsa, has a liability of between five and 12 months.

The NLC helmsman was however quick to add that some states like Osun though in debts, have since devised means and ways of settling their obligations to workers.

While clearing the air on the vexatious issue of unpaid salaries in Osun, Wabba said: “The issue of Osun is different from the ones I have mentioned. After the receipt of the first bail out, we made an intervention there. Our founding president and the rest of us tried to work out a strategy to make sure that whatever comes into the state, including internally generated revenue is put on the table.”

Continuing, he said: “We realised that because the state borrowed from the banks whatever comes into the state, the banks first remove their share and so on. We had to work on the internally generated revenue and what is left of what comes into the state. As we speak, they are being paid, but in some cases, not in full. What they have done is that some category of workers will receive their full salary this month and the next month, they will receive a fraction while others receive full salaries. That is what has been going on there, but the beauty of it is that whatever comes is out on the table and no worker goes home every month without receiving something.”

Echoing similar sentiments, Deputy President of NLC Peters Adeyemi said that non-payment of salaries after the first bailout and the release of the first and second tranche of Paris Club refund show that the governors are misusing state funds.

He listed some of the defaulting states to include Ondo, Ekiti, Kogi, Benue, Oyo, Abia and Imo.

Situation report across some states

At a time civil servants in many states across the country are groaning over non-payment of the salaries for many months, their counterparts in Kano state are unaffected.

Speaking to our correspondent on the structure of salary payment in the state, Kano state Commissioner for Information, Malam Muhammad Garba said that despite the economic crunch, every civil servant in Kano receives salary alert on the 25th of every month.

According to him, the state government spends over N110 billion annually on the payment of salaries to the 151, 000 civil servants in its payroll. The sum of N9.2 billion is being paid monthly as wage bill to 151, 000 workforce in the state.

“It is our stand that payment of salary is an obligation to any serious government, hence our decision is to ensure that workers are paid as at when due because their welfare is paramount,” he stressed.

The Chairman of the Nigeria Labour Congress (NLC), Kano state chapter, Comrade Kabiru Ado Minjibir confirmed this development.

However, he said government owed some workers N9.1bn as outstanding gratuity, death benefits and pension arrears.

He added that the government also owed N220m eight months’ salary arrears for the regularised teachers under Kano State Senior Secondary Schools Board (KSSSSB) recruited in 2015.

Minjibir added that there was also outstanding salary arrears of N532m for the regularised staff of Kano State Primary Healthcare Management Board also recruited in 2015, as well as nine months’ salary arrears for the regularised staff of Kano State Security Guards to the tune of N142m.

In Kogi State, the Labour union said 30 per cent of the state’s workforce is owed 21 months salaries; 21 per cent owed between 11 and 18 months; while about 45 per cent took their salaries up till July this year.

But Governor Yahaya Bello insists that he only owes salaries for two months – August and September, 2017.

In Rivers State, the civil servants have been paid their salaries up to September 2017, same with Local Government workers. Pensioners are however owed four months arrears.

In Katsina State, salaries have been paid up to last month September 2017 for the state and LG workers.

The state NLC chairman Comrade Tanimu Saulawa and his NULGE counterpart, Comrade Aliyu Kankara, said only gratuities were outstanding.

In Kebbi State, workers are not being owed. The state Commissioner for Finance, Alhaji Ibrahim Muhammed Augie, said out of the N3.5n allocation to the state by the federal government N1.5bn is being expended every month on workers’ salaries.

In Kwara State, the government insists it is up to date in the payment of salary and pension.

It however admitted owing some arrears of gratuity of pensioners as well as subvention to some of the state tertiary institutions.

Secretary of Concerned Pensioners of Kwara state, Comrade Ayodele Ajibola, said the government owes pensioners arrears of pension and gratuity since 2006 running to N3.3 billion.

On pension, Ajibola said the government is not owing because some collect as low as N2,850 monthly.

The Chairman of NLC in the state, Mr Yekini K. Agunbiade, said civil servants in Kwara State Water Corporation, state media houses, Kwara express and state tertiary institutions.

In Jigawa State, there is no case of outstanding salaries. Both civil servants and pensioners in the state get their monthly pension on 7 or 8 of every month.

In Nasarawa State, civil servants are owed one month salary, according to the state chairman of Nigeria Labour Congress (NLC), Comrade Abdullahi Adeka.

Local government workers are owed shortfalls of 18 months now because they receiving their salaries in percentage.

For pensioners, they are getting their pension as at when due but with some challenges.

In Edo State, the civil servants have been paid salaries up to September 2017.But at the Local Government workers are being owed between five and 13 month salaries.

Some of the state pensioners are owed few months pension arrears but the LG pensioners are being owed between five and 42 months pension arrears.

The Imo State Chairman of the Nigeria Labour Congress (NLC), Comrade Austine Chilakpu, has said that the state government is up to date in the payment of workers’ salary.

According to him, “since January 2016 Imo state government has been paying percentage of salary. First time they started paying parastatals fifty percent, civil servants seventy percent and they are now paying eighty percent. So we are now working out all these things to show the world that Imo state government is owing workers, but the eighty percent they are paying is up to date.”

Lamenting the fate of pensioners, the State Secretary of the Nigeria Union of Pensioners, Mr. Livinus Ashiegbu, decried the slow pace of the verification exercise.

“Since the inception of this government, no pensioner whose gratuity above five hundred thousand naira has been paid,” he stressed.

In Ondo state, the government under Governor Oluwarotimi Akeredolu is up to date on salary payment to workers.

Sources said any moment from now, the October salary will be paid in conformity with the promise of Governor Akeredolu to be committed to workers welfare as engine room of the state government.

However, the four months outstanding salaries inherited from the immediate past administration of Dr Olusegun Mimiko is yet to be paid.

Akeredolu had settled August and September 2016 arrears, while that of October, November, December and January are still outstanding.

The chairman of Nigeria Labour Congres (NLC), Enugu state, Comrade Virginus Nwobodo confirmed this to The Nation that workers are not being owed salaries.

He said: “Everything about Paris Club fund is not a hidden thing in Enugu. There is a committee put in place regarding that. And the labour is well represented in the committee. As far as we are concerned, Enugu has utilised the money well.”

Ogun State government also maintained that it doesn’t owe its workers salary arrears.

The Secretary to the State Government, Barr. Taiwo Adeoluwa, it said it has issues with the deductions and working to straighten things put but added that in the areas of salary payment, the state government does not owe salaries.

“We are not owing workers salary. We only have issues with deductions but not salary and government is working to address the deductions. (government workers are owed elsewhere) but not in Ogun. No. Not in Ogun state,” Adeoluwa boasted.

In a telephone interview with our correspondent, Hon. Commissioner of Finance in Abia State Obinna Oriaku said that the state does not owe workers at the government ministries and parastatals in the state.

According to Oriaku “If the Paris refund is still outstanding which of course we are aware, we are among those that need it. Abia has been able to receive Bailout was N14.1b, the first tranche of Paris refund was N1.6b and the last one was N5.7b.

“When the N14.2bn bailout came, we called together, labour leaders; NLC, TUC, NULGE, Pensioners Association and to the last kobo, that N14.2 was disbursed for salaries and pensions and nothing was used for any other project and it was on this note that even ICPC commended us for being among the states that judiciously used their bailouts to pay their workers.

“The second tranche of N10.6, even though that the suggestion was that we should use at least 50% to pay salaries and 50% of that amount is supposed to be N5.3b but we used almost N5.9b to pay salaries. Now, the last one N5.7b was used entirely for salaries. So, to a large extent we have judiciously used these funds for salaries, pensions and gratuities.

“For MDA’s (Ministry, Department and Agencies) which constitutes about 60-70% of the entire workforce, we do not owe them. For local governments, we have about three months outstanding. Primary schools are three months outstanding. Where we have issues are on parastatals and these parastatals are revenue generating agencies and institution. What the state government does is to give them subvention and not to pay their salaries. However, we are making efforts to see how we can catch-up with the outstanding subventions that are unremitted.

“The entire wage bill including local government is about N5b and cumulatively what we are receiving on a monthly basis is about N5b. But recently we received less than N3b including monies for local government which and that means that we have to play catch-up. There are gaps occasioned by the wage bill comparative by what we receive monthly. So, the more we try to play catch-up, the more it also keeps catching up. But we are trying our best to make sure that we pay workers in the MDAs and also see how others can be paid by making sure that their subventions are regular.”

The chairman Nigerian Labour Congress (NLC), Abia State chapter, Comrade Uchenna Obigwe  solicited for more funds from the federal government in order to help the state set off accrued salary, pension and gratuity arrears that the state was owing to workers and pensioners.

Comrade Uchenna Obigwe in a telephone interview with our correspondent blamed past administrations in the state for the accumulated arrears of pension, gratuity and salaries which he said has put the state into indebtedness.

“They are only being owed leave allowance for 2017 and promotion arrears. Where we have challenges are in the parastatals like the primary and secondary school teachers that are being owed for about 4 to six months. Pensioners are being owed for about 13months to up to 33months.”

Workers in Oyo state are currently owed salaries for two months. The workers and pensioners are yet to receive salaries for September and October, 2017.

This is an improvement over last year when workers and pensioners were owed for four months.

The Commissioner for Information, Culture and Tourism, Mr Toye Arulogun, told The Nation: “Oyo State Government has paid salaries and pension till August, 2017. Only September and October are outstanding. The Government is committed to clearing all arrears with any available means any moment.”

Serious cause for concern

Though the issue of unpaid salaries has long existed, it is anybody’s guess whether the state governments concerned have shown the necessary understanding with the problem.

President Muhammadu Buhari actually did express his concern over the unresolved issue, especially concern over the growing complaints and agitations by workers in states over unpaid salaries and allowances, in spite of his administration’s interventions.

The various interventions which the 36 states had received from the Federal Government include bailout, Paris Club refund and budget support.

Buhari spoke at the Aso Rock Presidential Villa in Abuja last week while receiving a delegation of governors led by the chairman of the Nigerian Governors’ Forum, Abdul’Aziz Abubakar Yari of Zamfara State.

On the delegation were Governors Rotimi Akeredolu (Ondo), Abubakar Bagudu (Kebbi), Mohammed Abubakar (Bauchi), Mohammed Badaru Abubakar (Jigawa), Abdulfatah Ahmed (Kwara) and Udom Gabriel Emmanuel (Akwa Ibom). The deputy governor of Ebonyi State Eric KelechiIgwe was also on the delegation.

Raising some posers, Buhari queried, “How can anyone go to bed and sleep soundly when workers have not been paid their salaries for months? I actually wonder how the workers feed their families, pay their rents and even pay school fees for their children.

He told the governors that the federal and state governments would need to work closer together to ameliorate the situation.

Lame excuses by governors

But Yari was quoted as telling Buhari that the governors inherited backlog of unpaid salaries and huge debts portfolios on assumption of office.

Benue State Governor Samuel Ortom has said that his inability to pay salaries is not deliberate.

He spoke with State House correspondents after briefing President Buharion the challenge of salary payment among others.

“We’ve not diverted money whether bailout or Paris Club anywhere. The records are there for anyone to scrutinize and see,” he said, adding that he inherited N69 billion arrears on pensions, gratuities and salaries as well as over N70 billion contractual obligations.

Ortom, who insisted on the wage bill review, vowed to prosecute anyone found culpable in salary inflation.

“The issue is that we must admit that Benue State wage bill is one of the highest in this country, N7.8bn. My predecessor admitted that there was a mistake in negotiating with them, but they resisted attempts to bring it down. Now, we’ve no choice. We’ve set up technical committees comprising labour congress and my government. They’ll look at it and review wage bill and ensure that leakages are eliminated, salary padding and ghost workers and all that.

“Honestly, N7.8bn wage bill for Benue State is out of place, and there’s no way we’ll continue in this manner. I and my council have looked at the wage bill and compare with what people are collecting elsewhere in the country and we’ve done it to an average of N4.5bn. We just have to review it to that because an average income for Benue State both from federation account and IGI stands at slightly above N6bn. So, if you’re paying salaries alone, you’ve a deficit of N1.8bn a month. It’s impossible and we’ve security issues to tackle and several other things that government must run. So, it becomes a big problem,” the governor said.

Wither the Paris Club refund?

The disbursement of the Paris Club Refund was hinged on payment of salaries but the contending issue is that most state governors have either refused to acknowledge it or totally feign ignorance.

But thankfully, the NEITI Quarterly Review focused on disbursement from the Federation Accounts and Allocation Committee (FAAC to the three tiers of government (federal, states and local governments) shared N2.788 trillion between January and June this year, a 38% increase on the N2.019 trillion shared in the first half of 2016.

The report signed by Dr. Orji Ogbonnaya Orji, Director, Communications and Advocacy and obtained by The Nation is based on data obtained by NEITI at the meetings of FAAC and data from National Bureau of Statistics, Office of the Accountant General of the Federation, Federal Ministry of Finance and the Debt Management Office.

On the Paris Club debt refund to the 36 States and Federal Capital Territory (FCT), the NEITI Quarterly Review confirmed that N760.18 billion was released by the Federal government to the 36 states and the Federal Capital Territory Abuja.

The money which was paid in two tranches represents refunds of over deductions from FAAC allocations to states and local governments used for quick payment of debt relief granted to Nigeria by the Paris Club between 1995 and 2002.

The NEITI publication disclosed that Rivers received the highest amount of N44.93 billion followed by Delta with N37.61billion and Akwa Ibom N35.98 billion.  Bayelsa got N34.9 billion while Kano state received  N31.74 billion respectively. The Federal Capital Territory, Abuja received the lowest amount of N2.05 billion.  Details of total Paris Club Refund to the 36 States and Abuja are produced below:

The NEITI Review reports that “the Federal Ministry of Finance stressed that the Paris Club releases should be used largely by the States for the payment of workers’ salaries, welfare, and pensions which may have been pending since 2014.”

NEITI’s interest in providing timely information and data on the FAAC allocations to the three tiers of government is in line with its mandate to monitor and enthrone transparency in the management of extractive industry revenues. NEITI’s is also interested in the FAAC disbursements in view of the fact that over 70% of the funds involved are derived from the extractive sector.

A rebuttal

Smarting from the unsparing criticisms from all fronts, the Nigerian Governors Forum said last week that the billions of intervention funds received from the federal government had reached about 200 million Nigerians in all the states of the federation.

NGF Chairman Abdulaziz Yari of Zamfara State said this in an interview with State House correspondents after a delegation of the forum met with President Muhammadu Buhari.

The various interventions which the 36 states had received from the Federal Government included bailout, Paris Club refund and budget support.

“200 million citizens in Nigeria are residing in respective states. These supports are going down to them when you are taking the indices from the grassroots,” Yari said.

He said they visited Buharu to thank him for the previous bailouts and the Paris Club refunds which, he noted, had enabled them helped to meet their obligations.

“We’re here on behalf of the 36 states governors and this is a result of the collective decision to see the President after the National Economic Council meeting last month. Our mission here is simple, we are here to thank Mr. President for his concern about the state of the economy and for giving us several support ranging from bail out, restructuring our debts, Paris club exit payment.

“We also told him that we think that  it was because of his  decision to grant us bailouts and pay the refund of the Paris Club that many Nigerians are criticizing him, this is the reason why we got out of recession. We thanked the president for that and at the same time, as a father, we said to him Mr. President you remember that in 2016, we presented to  you  the numbers of  Paris exit funds which we agreed, and you directed we be paid 50 percent and the remaining 50 per cent open reconciliation.

“Reconciliation has been on since 2016, we are hoping that both the Debt Management Office (DMO), Ministry of Finance, Attorney General of the Federation (AGF), and our consultants are concluding this reconciliation by November, so therefore we want to crave your indulgence so that we can factor the numbers in our 2018.”

But with many civil servants yet to receive arrears of salaries, the jury is still out on who is telling the truth between the workers and the NGF.

Additional reports by Kolade Adeyemi, Ernest Nwokolo, Okodili Ndidi, Damisi Ojo, Chris Oji, Sunny Nwankwo, Emmanuel Ujah and Bisi Oladele

Credit: The Nation

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