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Why states can’t pay workers’ salaries

by Business News Report

By Omoh Gabriel,
Huge expenditures on capital projects and sundry overhead have been identified as part of the reasons many state governments in Nigeria are unable to pay their workers’ salaries for many months now, Vanguard investigations have revealed.
About 18 state governments in the country currently owe their workers salaries for periods ranging from two to 11 months as at the end of May, 2015.
States and indebtedness

Some of the effected states include Abia, Akwa Ibom, Bauchi, Benue, Cross River, Ekiti, Imo, Katsina, Kogi, Ogun, Ondo, Osun, Oyo, Plateau, Rivers and Zamfara.
Vanguard also gathered that the states have mortgaged their federation account allocations to contractors executing various capital projects by signing irrevocable payment orders with various banks. As a result, payments to contractors and other debt instruments are deducted at source and have become first line charge on their lean resources.
To compound the states’ woes, their internally generated revenues are not growing concurrently to match their exposures to these revenue outflows.
In addition to these funds mismatch, the states have had to prioritise sundry overheads especially those relating to services and to political office holders above salary obligations to their workers.
Resign now, Omisore tells Aregbesola

In the light of the crisis, the former Chairman, Senate Committee on Finance and Appropriation, Senator Iyiola Omisore, has called on Governor Rauf Aregbesola to immediately resign his position and allow more competent hands to run the affairs of the state before it is grounded.
Speaking with newsmen in Osogbo, Omisore argued that for Aregbesola to have admitted that the problem of Osun State was beyond his capacity, he expected him to have thereafter communicated this to the state House of Assembly and honourably resigned.
His words: “Osun is now a failed state because of the financial recklessness of the governor. I really appreciate the fact that he confessed the present state of Osun affairs is beyond him, and he should immediately throw in the towel.
“Nearly all commercial banks in Osun are being owed one form of loan or the other. The matter has reached a stage that the committee of bankers in the state at their meeting resolved that no bank should loan this government any more money. They are also waiting for remittances into state’s coffers.
“As soon as money comes in, they withdraw it. The situation calls for sober reflections, and we will also look at ways we are going to help our people in a manner that will not ridicule them.”
Commenting further, Omisore said the immediate past federal administration did not owe Osun or any state statutory allocation or any other funds due to it, and alleged that, apart from inflated contracts, Aregbesola also spent a huge sum on the presidential project of the All Progressive Congress, APC, and was among the five highest donating states.

You are not an alternative, Aregbesola retorts

However, in a quick response, Aregbesola said: ”I will reply Omisore the way Yoruba people will put it, that ‘Tóju akata balewo, enu adie ko laotigbo, meaning: Omisore is not competent to comment about alleged miss-governance by Aregbesola.
“Given the tendency that Omisore represents, even if Osun were to come under the most incompetent of public administrators, he would still not be the alternative that Osun people want to live with. An Omisore governorship is better imagined than experienced.
“Is it in his obvious lack of knowledge of what public administration and selfless service to the people is or that he represents a party that is actually responsible for Nigeria’s present predicament through its 16 years of misrule?
“We are not surprised that the unpaid salary has made Omisore to find his voice after his fruitless search for a non-existent mandate. We do not expect anything better from a man who at the best of times, still fabricated lies against the Aregbesola administration all in his desperation to get the acceptance of the Osun people.
“Aregbesola is not reckless and the records and evidence abound to establish this fact. The National Bureau of Statistics, the Debt Management Office of the Presidency, and other agencies that operated under the PDP, could not find anything against Aregbesola other than statistics that confirmed how the Osun economy has been improved.
“We recognise the hardship unpaid salaries can bring and we are appealing to our people for understanding and assuring them this will soon come to an end. But that is not to say that the likes of Omisore have any ideas that are capable of helping our people.
‘Stop deceiving Ekiti workers’

In Ekiti, the All Progressives Congress, APC, in the state and the Ekiti State Government, were yesterday engaged in war of words over the delay in the payment of workers’ salaries.
While the APC asked Governor Ayodele Fayose to stop deceiving the state workers with failed promises to pay their salaries, the state government, in a swift reaction, described APC’s claim as shameful, saying the party should stop acting shamelessly.
The state Publicity Secretary of APC, Mr. Taiwo Olatubosun, had in a statement accused the governor of deliberate falsehood on the state’s financial status, saying the governor had no excuse to owe workers’ salaries.
The party’s spokesperson, also faulted the perceived endless workers verification exercise designed to keep faith with the government, describing it as a wicked tactic to secure workers’ cooperation.
He said: “We have heard the governor say that the state was broke and we can’t find merit in that declaration. This is because of the savings made from all the empowerment schemes cancelled by the governor; the thousands of workers that were sacked; and drastic cuts in the allowances and running grants of workers, including traditional rulers, would have saved the state millions of Naira.”
Olatubosun noted that Governor Kayode Fayemi carried out verification exercise only once through biometric auditing that brought sanity to wage payment system.
He wondered why after Fayose had carried out three verification exercises within seven months, the governor was still subjecting workers to an unnecessary verification contraption.
He noted that “we in APC pity the workers, including pregnant women, who queue endlessly in the sun waiting to do this ill-conceived verification exercise. The governor assured that 48 hours after the exercise, the cleared workers would receive their pay. But two months after some workers completed the exercise, the governor has refused to pay, instead he is keeping workers on queue for hours in the sun for the salary that would not come. As a result, the workers have become confused, dejected and despondent.”


“Explain how you spend Ekiti money”

He urged the governor to come clean on how he had been spending Ekiti money, saying rhetoric on state’s indebtedness was a callous way to deny the workers their entitlements while the governor was enjoying his personal life.
He said: “Ekiti people have heard how N650 million is being deducted from source to pay the governor’s election contractors. For six months, Fayose didn’t pay kobo on the purported Fayemi’s over-bloated debts. Savings in millions are made from cuts in workers and Obas’ allowances and running grants, including the savings in millions from thousands that lost their jobs. Social security for 20,000 elders was also cancelled by the governor.”
Also, he said “many youths empowerment schemes that cost Fayemi millions of naira were cancelled by Fayose. Street lights supply is now for three hours daily. Fayemi ran it for 12 hours. Fayose has stopped funding security agencies which has led to high crime rate in the state.”
Speaking further, he said “almost all the ongoing road constructions were fully paid for by Fayemi while Fayose cannot claim to have awarded any contract. The dividends of democracy Fayose has given to Ekiti people in the last 8 months is brigandage, thuggery, blocking of highways, kidnapping and crushing of the judiciary and the legislative arms of government.”
“He collected N22billion refund on federal projects while he also collected N2billion Ecological Fund which Fayemi did a lot to access without success. The question is, what is the governor doing with Ekiti money?” Olatubosun queried.
The party appealed to Fayose’s election contractors to spare a thought for the welfare of Ekiti workers, pleading that they should give the governor some moratorium to enable him pay workers salary.
Faulting the governor and his aides for making reference to Osun State over salary payment default, the party argued that while Governor Rauf Aregbesola had many development and infrastructure projects he could point to, same could not be said of Fayose who sing-song was always on debts.


APC should stop being shameless – Ekiti Govt

In its reaction, Ekiti State government has described as shameful, the persistent claim by the Ekiti APC, that Governor Fayose was deceiving workers with the verification exercise, saying the party should stop acting shamelessly.
The governor’s Special Assistant on Public Communications and New Media, Mr Lere Olayinka, said over 1,000 fake workers have already been discovered on the payroll that ought not to be receiving salary.
Olayinka disclosed that “over 250 workers that are already dead have been receiving salary through the e-payment system introduced and contracted to a Lagos based company by the immediate past APC government.”
The governor’s aide, who urged the APC to first remove the timber in its eyes before aspiring to remove the toothpicks in other people’s eyes, said the party should prevail on its governors in neighbouring States to pay workers that are owed as much as right months salary.
He said: “We commenced workers verification exercise last month and we have kept faith with our covenant with the workers by paying the April salary of those already cleared. As at today, we have discovered more than 1,000 people that were receiving salary fraudulently, out of which over 250 are dead. The over 1,000 fake workers have now been deleted from the payroll and the exercise is still ongoing.”
On the claim by the APC that the State government received N22 billion from the Federal Government as refund for construction of federal roads in the State, Olayinka said “only a demented mind would believe that a refund of N22 billion was made by the federal government on N11 billion road projects.”


NLC sends SOS to Buhari

NIGERIA Labour Congress, NLC, has said it has sent the names of state governments that are owing workers months of unpaid salaries and other benefits to the President Muhammad Buhari for immediate action.
General Secretary of NLC, Dr. Peter Ozo-Eson, told Vanguard yesterday that Congress sen the names through the Transition Committee of the President.
He said “what we had done was to set up task forces according to zones and wrote to the states affected to commence action. A number of states actually took actions which led to for example in Plateau State where the new government invited the leaders of NLC in the state for negotiation.
At the end, the new government agreed to pay two months out of the arrears and that the remaining would be addressed later. They signed and agreement.
Similar things are going on in other affected states. However, we have complex names of the affected states and sent to the transition committee of the President. That is where we are now.”
“For instance, Ado-Iworoko-Ifaki Road on which they claimed federal government refunded N22 billion was awarded by the Engr Segun Oni government for N7.4 billion. In 2013, the APC government of Dr Kayode Fayemi increased it to N11 billion, claiming the increment was to ensure quick completion of the project.”
“So, How could federal government have refunded N22 billion on a N11 billion road project? These people just love to tell lies, hoping that they can again lie their way into the hearts of Ekiti people, but the people already know them and their stock in trade,” he said.

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