By Daud Olatunji
It is no more news that, Ogun State was one of the states in Nigeria that opted for a bail out. It is not also no news that the state has collected the bail out from the Federal Government. But, the shocking news is that the government has refused to disburse the bail out accordingly. The waiting game continues among the civil service workers in the state whose deductions have been withheld due to the financial challenges facing the state.
Hitherto, July 29, 2015, the state governor, Senator Ibikunle Amosun had approached the state House of Assembly requesting approval to restructure its N48 billion bank loan as at June 30, 2015 to commercial banks for conversion into the Federal Government’s bond bail-out package.
The governor’s letter to the house stated that the bail-out would reduce the amount the state government spent from its statutory monthly allocation on servicing debt to banks since it would allow for more time to repay the loan.
The House majority Leader, Adeyinka Mafe, had canvassed that the state government would benefit from the single digit interest rate on the repayment of the loan, instead of the current double digit rate making more money available for completion of the on-going roads, model colleges and other infrastructural projects as well as funding of new capital projects.
Sequel to this in September , the Central Bank of Nigeria approved the disbursement of the state’s N20 billion bail out fund for the state. Director, Corporate Communications, Central Bank of Nigeria, Mr. Ibrahim Mu’azu said the approval for the bailout was based on the CBN’s decision to collaborate with relevant stakeholders to consider ways of liquidating the salaries owed the workers by state and local governments.
Mu’azu said the other conditions for accessing the loans are a resolution of the states’ Executive Councils authorising the borrowing; and the state Houses of Assembly consenting to the loan package. He said the release of the fund followed the restructuring of the states’ individual debts into bonds by the Debt Management Office at an interest rate of 14.83 per cent of the value.
CBN spokesperson, said the bailout, which was in line with the recent resolution by the National Economic Council, NEC, was to enable the affected states to pay the backlog of workers’ salary arrears. The package has a 20-year repayment tenure for all states, except Ogun State, which opted for a 10 year tenure.
Mu’azu however, disclosed that contrary to reports that Ogun State accessed N20 billion from the bailout, the state actually received a total of N18.9 billion. Meanwhile, Amosun said rather than the 20 years debt restructuring approved for states, his government has set machinery in motion to repay the bailout funds within 10 years. The governor while speaking at a meeting with the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) promised not to leave debt for his successor.
He also declared that he would save about N80billion for the state with the option taken by his government. Bank loans acquired for salary arrears, according to the apex bank, will also be extended to a minimum of 15 and not more than 20 years. Amosun however disclosed that the state’s bank debt currently stands at N55billion.
“The bailout they are talking and the money that they said they’ve restructured, if we are going to pay it for 20 years, you know how much we will pay back? We will pay about N160billion back in 20 years time.
“All that we have collected now is the N9.7billion for the state and the N9.1billion for the local governments. Now the N55billion that we are hearing, the loan that I collected (from banks) since I became the governor is about N39billion. The outstanding that we paid from my predecessor is about N16 billion. When you add the two together, it’s the N55billion.
“And for us in Ogun State, I have said I don’t want to subject Ogun State to that debt for that 20 years; so we said they should reduce it to 10 years. The savings we are going to make for Ogun State is N80billion for opting for 10 years. “Even I pray to God that between now and when I would leave, we would have probably settled the debt so that people coming after us, they will come and meet a clean state. So, when people hear this bailout, it means that those states, for the next 20 years, it is the debt that they would be paying.
“Yes, we may have this temporary discomfort, but within the few months, if everybody works together, we’ll make our money. If Ogun State everyday makes about N250million, we are okay. That is the target”, he said.
But on September 30, at the special reception held in honour of the immediate past Head of Service in the State, Mrs. Modupe Adekunle and 35 retired permanent secretaries from the state civil service, Amosun announced the commencement of payment of backlog of cooperative deductions and leave bonuses to all categories of the state workforce.
The state governor said he had approved the immediate payment of the arrears from November 2014 to April 2015 from the bailout. He also said the state on its own paid the deductions from June to September 2015. He affirmed his administration’s commitment to paying the salaries of its workforce as at when due, saying this had been the culture of its administration even in the face of the sudden economic downturn in the country.
The immediate-past Head of Service, Modupe Adekunle, has said though, the government was owing workers salary deductions, declared, that no workers are being owed salary, as is being speculated in some quarters. She said; “Yes government is owing seven months deductions, but, no salary is owed till date. But I want to assure you that government is prepared to pay the outstanding deductions. Government has put all machinery in place to effect the payment soon.
“My dear comrades in the public service, undoubtedly, these are trying times but with patience, prayers, commitment and sincerity of purpose from all of us, either as political office holders or career officers, I believe we shall overcome. The time is nigh, we must therefore, not lose focus and remember, we have a duty to ourselves and generations yet unborn. In whatever we do, we must do our best.”
Meanwhile, many workers are angry with the governor over the delay in the payment of their deductions since he has collected the much awaited bail out. Some of the workers who spoke with our correspondent pleaded anonymity because they are not authorised to speak on it as civil servants, accused the governor of fixing the money to the detriment of the workers.
Vanguard has learnt that the governor has received the money, but, has refused to disburse the funds accordingly. It was further gathered that the state government may have decided to fix the money for a while so as to get some interest from banks and use it for the development of the state. But, the workers seem to be feeling the pain the more. When contacted for comment, the spokesman for ex-political office holders in the state, Jamiu Keshinro said they have not received their severance allowances from the bail out.
He said, though, the governor was ready to pay them , he was yet to disburse the fund to them. Keshinro said, most of them are confessed over the delay and have begun sending emissaries to the governor for the quick payment of the money. The state Chairman of Nigeria Labour Congress, Akeem Ambali could not be reached as at the time of filing this report. But, the state chairman of the Academic Staff Union of Secondary Schools in the state, Akeem Lasisi said the teachers were yet to get their eight months deductions.
He said that the teachers only enjoyed sustained payment of salaries but, were hopeful for their eight months deductions. “ We have decided to forge ahead and trudge on despite the heavy and retarding financial burden which we bear. We shall continue to discharge our responsibilities”.