To end the lingering and back-breaking burden of unpaid workers’ salaries in several states of the country, President Muhammadu Buhari has approved a comprehensive relief package.
Sources said, yesterday, that President Buhari okayed a three-pronged relief package including sharing of fresh allocations, granting of soft loans and restructuring of states’ debt-servicing payments.
The packages are expected to go into effect this week as the President is said to have directed that release of the funds should be made urgently to assuage the plight of thousands of Nigerian workers in the federal and state governments.
The packages are:
About $2.1b (N413.7bn) will be shared in fresh allocation between the states and the federal government. The money is sourced from recent Liquefied Natural Gas (LNG) proceeds to the federation account.
A Central Bank of Nigeria (CBN)-packaged special intervention fund that will offer financing to the states, ranging from between N250bn and N300bn. This would be a soft loan that states could access to pay the backlog of salaries.
Implementing a debt relief programme proposed by the Debt Management Office, DMO, which will help states restructure their commercial loans currently put at more than N660bn, and extend the life span of such loans while reducing their debt-servicing expenditures.
Also, a total of N391 billion from the Excess Crude Account, ECA, will be shared among the three tiers of government, the Accountant-General of the Federation, Ahmed Idris, disclosed yesterday.
With the N413.7 billion LNG proceeds it means the three tiers of government will share a total of N804.7 billion.
By extending the commercial loans of the states, according to the third package, more funds would be made available to the state governments, which otherwise would have been claimed at source by the banks.
It was gathered that the Federal Government has agreed to use its influence to guarantee the elongation of the loans for the benefit of the states.
Sources explained that this package, which was considered at the National Economic Council, NEC, last week, is designed specifically for workers, adding that President Buhari reviewed and approved the package in his bid to intervene and alleviate the sufferings of workers, some of whom have not been paid for over 10 months.
Contacted, the Special Adviser to the President on Media and Publicity, Mr. Femi Adesina confirmed the development, adding that the President is deeply concerned about the plight of the workers.
While inaugurating the NEC last week, President Buhari asked the council to, as a matter of priority, consider how to liquidate the unpaid salaries of workers across the country, a situation he observed has brought untold hardship to the workers.
While the N413bn LNG proceeds would be shared among the three tiers of government using the revenue allocation formula, the CBN will also make available the special intervention fund to states and then negotiate the terms with individual states.
At the NEC meeting, the relief measures were extensively discussed between the state governors and top officials of the Federal Government including the CBN governor, and the permanent secretaries from ministries of Finance and Petroleum Resources. Other agencies that were actively involved in the process include the DMO and officials from the Office of the Accountant-General of the Federation, it was learned.
Currently, 12 of the 36 states of the federation are owing their workers more than N110 bn. The most affected states are Osun, Rivers, Oyo, Ekiti, Kwara, Kogi, Ondo, Plateau, Benue, and Bauchi.
However, sources said the Finance Ministry and the CBN may have pegged the amount needed to settle all the outstanding public workers salaries at about N250 billion. There are also workers in the federal government’s employ whose salaries have not been paid for months and their cases would be taken care of by the new package.