19th May, 2015
Dr. Ngozi Okonjo-Iweala, Nigeria’s Minister of Finance, is bowing out of office with the economy worse than she met it
As their members battle with hunger and inability to meet up with their basic obligations as a result of backlog of unpaid wages, Nigerian labour leaders indicated last week that they may have no other option than to ask workers to stay at home. Another round of industrial crises appears to be looming.
But as harrowing as the tales of the unpaid wages, especially of civil servants, teachers, doctors and others employees in the public service whose salaries even when regularly paid can barely take them home is, it is doubtful if the resort to industrial action can force a significant change in the salary crises. For one, most of the state chief executives have indicated that the remedy for rectification of the default in the payment of salaries and other emoluments of workers is beyond their powers.
The Governors, especially those elected on the platform of the All Progressives Congress, APC repeated their incapacitation on the matter of salaries during a visit to General Muhammadu Buhari, Nigeria’s President-elect early this month in Abuja.
“One of the issues that became of concern to all of us is the really bad shape of the Nigerian economy. We have come to notify the incoming president of the challenges ahead of him. As it stands today, most states of the federation have not been able to pay salaries and even the federal government has not paid April salaries and that is very worrisome. By May and June, the unpaid salaries will be in cumulative of three months,” Rochas Okorocha, Chairman of the Progressives Governors’ Forum, PGF who led his colleagues to the meeting with Buhari told journalists at the end of the meeting. He pleaded with the President-elect to consider implementing bailout measures that could at least, enable them meet their salary obligations to workers.
Dr. Ngozi Okonjo Iweala, the Minister of Finance and the Coordinating Minister for the Economy, did not find funny the claims by the Governors that the “bad shape” of the economy was responsible for their inability to pay wages. Indeed, going by her subsequent reactions, Okonjo-Iweala who had before now painted a rosy picture of the economy, despite all indications to the contrary, considered the claims by the Governors a direct attack on her management of the financial system in the past four years.
According to her, the claim by the APC governors-elect that they have been unable to pay salaries because the President Goodluck Jonathan administration has mismanaged the economy was wrong. Rather, she located the problem in the lack of prioritization.
The Minister also affirmed that Staff salaries at the federal level were up to date, as workers had received their April salaries. However, in the chest thumping dismissal of the claims of the governors, the Minister failed to tell Nigerians that the Federal Government itself has had to borrow from the banks to be able to pay its workers.
Okonjo-Iweala revealed later to journalists in Abuja that the Federal Government itself has been hemorrhaging in meeting salary obligations and that it has been doing so through massive borrowing. Shockingly, she revealed that more than half of the budgetary provisions for borrowing in 2015 have been used in the first four months to pay salaries and provide funds for overheads.
“Of the N882 billion budgetary provision for borrowing, the government has borrowed N473 billion to meet up with recurrent expenditure, including salaries and overheads. No capital release so far.” And like the Governors, she attributed the situation to the decline in revenues accruing to the coffers of government as a result of the fall in the price of oil.
This, according to Senator Abiola Ajimobi, the Governor of Oyo State, was unnecessary equivocation on the part of the Minister. Festus Adedayo, the special adviser (media) to the Governor said the fall in the allocation accruable to the states was responsible for the financial challenges being faced by states just as it is being experienced by the Federal Government. As he pointed out, allocations to state governments had generally reduced by 50 per cent while the Oyo State government which used to collect about N4billion now receives about N2 billion monthly, while it has salary obligation of about N5.3 billion. This, he said has made it difficult for the State to continue with its tradition of paying its workers on or before 26th of every month as it used to do.
Culled from TheNews website. Full story here: The Failed Minister