Why Have Most Governors Refused To Pay Workers Salaries In Spite of Bailout Funds?

Some states are still defaulting in their financial obligations to their workers in spite of the bailout funds by the Federal Government to assist them to pay outstanding salaries and allowances. Recall that the Federal Government released N338 billion to 27 states as bailout funds to pay their workers backlog of salaries and allowances.


This was occasioned by the falling monthly allocations to states from the federal allocations due to the drastic fall in crude oil prices at the international market. A survey by NAN across the states indicated that many state governments still owe salaries and allowances after collecting the funds.

Oyo State Government said it spent the N26.6 billion it got as bailout to pay only four months’ salaries. Gov. Abiola Ajimobi of Oyo State, had before the receipt of the fund, initiated a meeting with labour unions where it was agreed that the fund be used to clear four months outstanding salaries of workers.

The state government still owes the workers two months salaries. Mr Waheed Olojede, the NLC Chairman in Oyo State, confirmed that the labour met with the state government where it was resolved that the N26.6 billion should be used to clear salary arrears from May to August.

The Osun Government, on its part, received N34.8 billion bailout from the Federal Government, but the workers are still owed about four months salaries. Mr Subair Oloyede, the Secretary, Osun State Association of Medical and Dental Officers (OSAMDO) expressed displeasure at the non-settlement of backlog of salaries.

“The state government asked us to exercise patience when workers were being owed up to eight months salaries. “We expected the government to settle all outstanding salaries owed us from the bailout loan granted by the state. It is indeed uncalled for that we are now being paid half salaries in spite of the receipt of the bailout fund meant to settle workers’ salary arrears,” he said.

Oloyede said that members of OSAMDO had been on strike for three months now, while the state government had yet to address their grievances. Mr Kunle Oyatomi, the Publicity Secretary of APC in Osun, however, said the bailout fund was judiciously used as directed.

He said, “After the release of the bailout by the CBN, payment of salaries of workers had been consistent. A Memorandum of Understanding between the state government and the committee inaugurated on disbursement of bailout loan was signed before the disbursement to ensure that it was well spent."

In Kwara, Dr. Muideen Akorede, the Senior Special Assistant to Gov. Abdulfatah Ahmed, confirmed that workers in some agencies, departments and tertiary institutions were owed salaries. He, however, said that workers in the core civil service were not owed salaries and allowances.

Akorede attributed the delay in salary payment in the state to the sharp drop in federal allocations to the state. He said the state, which used to collect an average of N3.2 billion monthly, now received about N1.8 billion monthly. Akorede put the cost of paying salaries, pensions and subventions in the state at N2.4 billion monthly.

“Every month, we have a shortfall of almost N600 million. When the government was confronted with this situation, it decided to prioritise and shifted focus to core civil servants,” he said. Akorede said government had to shift its priority to ministries that were not generating revenue and suspended the subvention of those agencies that have capacity for internally generated revenue

He said the N4.6 billion bailout fund released in August could only pay two months out of the arrears owed workers. Afolabi Abayomi, a former State Secretary of the National Union of Local Government Employers (NULGE), told newsmen that government owed local government workers four months salaries.

According to him, nonpayment of salaries was taking a toll on NULGE members in the state. The Ondo State Government said that it had only paid salaries and bonuses of its workers up to October. Mr Kayode Akinmade, the Commissioner for Information, told pressmenin Akure that Gov. Olusegun Mimiko had, however, ordered immediate payment of leave bonuses.

“This is a proof that the current administration values all workers in the state and is committed to improving their welfare,” he said. In Ekiti, the state government said the bailout fund was devoted solely to payment of workers’ salaries. Gov. Ayo Fayose told newsmen that the state only got N9.6 billion out of the over N29 billion it initially applied for.

Fayose, who spoke through his Chief Press Secretary, Mr Idowu Adelusi, also said out the N5.6 billion applied for by the 16 local governments in the state, the Federal Government only approved N991 million. “We applied for N29 billion for bailout fund and it is to cover August and September 2014 salary arrears owed by the immediate past Kayode Fayemi administration.

“The 16 local governments applied for N5.6 billion and we did all the necessary paperwork and presented them to the appropriate authorities, but only N991 million was approved. We were later told by the CBN that about 14 states had similar problems with small amount approved.

“From what we got, we have been able to pay outstanding 2014 salary and 2014 leave bonus, leaving out only pension and gratuities which were not captured in the initial bailout sum that we got. We have also paid September and October 2015 salaries as well as Christmas bonus to workers," he said.

He pledged that as soon as the balance of the bailout fund was released, the remaining arrears would be attended to without delay. The Nigeria Labour Congress (NLC) in Cross River said that the Cross River Government still owed gratuities of some retired members. A member of the NLC Joint Negotiation Committee, Mr Ndoma Akpet, disclosed this in Calabar.

He said although the government had fulfilled its electioneering pledge by paying salaries on time since assumption of office, the payment of gratuities remained a problem. “Non-payment of gratuities of retired civil servants for some years now has remained a problem despite the bailout funds. “We cannot understand what is happening despite all negotiations," he said.

Mr Eyo-Nsa Itam, State Chairman of Nigerian Union of Teachers (NUT), also said the government had not been up to date in the payment of gratuities although the state had been regular in paying teachers’ salaries. “We were being owed several months before this administration came in but has cleared all the debts and now he pays salary at when due," he said.

However, Mr Christian Ita, Special Assistant and Chief Press Secretary (CPS) to the Governor, told newsmen that the state government was paying gratuities. "We are the only state in the country that is paying civil servants regularly and paying gratuities in new rates," he said.

Workers in local governments in Bayelsa State said that payment of their salaries was not up to date. One of the workers in Yenagoa Local Government said the payment was not steady, stressing that they were yet to receive November salary.

“It has been very difficult to survive without salary for months; you know when you are not paid you cannot afford to pay school fees of your children, especially in private schools. Putting food on the table will also be a challenge if you are owed backlog of salaries by your employer,” she said.

The Trade Union Congress of Nigeria (TUC), Bayelsa Chapter, however, explained that the state was yet to get the bailout fund. It called for quick release of the bailout fund approved for the state government to settle some outstanding salaries of its workers.

Mr Tari Dounana, Union’s state Chairman, made the call in an interview with pressmen in Yenagoa. He said that the authorities should ensure that the money was released to Bayelsa. “That bailout fund for Bayelsa has not been released, though the state government has been trying in paying its workers despite such challenge.

“In Bayelsa, despite delay in releasing the bailout fund, payment of salary of workers except those in the local government levels is up-to-date. Kano State government said it had not used the N20 billion bailout funds for the payment of pension arrears and salaries of newly-recruited health workers.

The state Commissioner for Information, Malam Mohammed Garba, said that part of the money would also be used for the settlement of arrears to workers promoted in recent time. He said that part of the facility would be disbursed to the 44 local governments in form of bailout package.

He said the 44 local governments were expected to spend the money on development projects, especially the five-km road dualisation projects initiated by the immediate past administration. “The state government also intends to use the money to pay some students of Corporate Security Institute, Gabasawa, who were not paid allowances for nine months,” he said.

Kebbi State said it had not benefited from the bailout fund being provided by the Federal Government to states that had difficulties paying workers their salaries. The Secretary to the State Government, Alhaji Babale, told news reporters in Birnin Kebbi that the state was not a beneficiary of the bailout fund as its workers were not owed salaries.

In Katsina State, the state government said it had since collected N11.5 billion as bailout fund from the Federal Government. The Senior Special Assistant to Gov. Aminu Masari on Media, Abdu Labaran, said part of the fund would be used to settle outstanding pension and gratuities to retired local and state government workers.

"The money had since been deposited in the state government’s coffers pending the conclusion of an ongoing verification exercise of the intended beneficiaries," Labaran explained. In Sokoto State, the State House of Assembly had since approved that the state government should access the N10.093 billion intervention fund to pay salaries, allowances and other fringe benefits of workers.

This was disclosed in the state House of Assembly following a motion moved by the House leader, Alhaji Aliyu Abubakar (APC-Tureta), on the need for the state to access the intervention fund. Abubakar said that the fund would ease the sufferings of the people in the state, especially the settlement of backlog of the pensions, gratuity and other allowances to the workers.

Source: Vanguard
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