President Muhammadu Buhari’s recent directive to the Minister of Finance, Kemi Adeosun, and Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, to act with dispatch in releasing the second tranche of the London-Paris Club refunds to the states in order to ease their financial hardships appears to be inevitable.
It is now obvious that the governors lack the financial capacity to effectively run their states including regular payments of salaries and pensions, no thanks to their profligate and kleptomaniac inclinations, thereby requiring bailouts from the federal government
The president, who addressed the meeting of the National Economic Council (NEC) made up of state governors and chaired by Vice President Yemi Osinbajo penultimate Thursday in Abuja, however, made a strong case for settlement of unpaid salaries and pension liabilities of workers.
“I will not rest until I address those issues that affect our people. One of these basic things is the issue of salaries. It is most important that workers are able to feed their families, pay rent and school fees, then other things can follow,” he said, according to a statement by his spokesperson, Garba Shehu.
It would be recalled that the first tranche of N522.74 billion of the London-Paris Club payment to the 36 state governors was made in November 2016, also following the president’s authorization in a bid to offset the salaries of workers of over seven months in some states. But many of the governors had been accused of diverting the money to purposes other than paying the backlog of salaries.
The governors were also accused of trying to hide receipt of the funds from the public, an accusation they had denied.
Speaking through the Nigeria Governors’ Forum (NGF), they refuted allegations that monies accruing to states from the Paris and London Club refunds ended in private pockets. They insisted that nothing illegal had been done in the entire process leading to the final disbursement of the first tranche of Paris and London Clubs’ repayment of the excess deductions from states’ coffers and the refund to states.
“The NGF maintains its earlier position that it has done nothing illegal as far as the disbursement of the Paris Club refund to states and the consultants are concerned. The Forum has all necessary approvals to act in the manner it did.
In a statement by the Head of Media and Public Affairs, NGF, Abdulrazaque Bello-Barkindo, the governors explained that the refunds have been on the cards since 2005 and that successive state governors had tried to get reimbursement of the excess deductions from their states in the past but did not succeed.
The governors also revealed that in the course of pursuing their refunds for the past 12 years, some states negotiated fees of between 10 and 30 per cent with consultants that they contracted to assist them with the recovery of the excess deductions from the states.
Indeed, a law firm – Edward and Partners – based in Nigerian and the United States, has written a petition to the National Assembly demanding that its fee of $86 million be paid for facilitating the recovery of $3.189 billion from the Paris-London Clubs.
But the Minister of Finance, Mrs. Kemi Adeosun, on Monday doused the expectations of the 36 state governors on the further release of Paris-London Club refunds to the states, making it clear that any further payment was dependent on the current and projected cash flows of the federation. She also said that the complete and final refunds would only be released and published after each state and the federal government have reconciled and agreed on the sums due.
She equally stated that the second and subsequent tranches would be tied to the outcome of the independent monitoring of compliance with the terms and conditions attached to the previous releases as agreed to between the federal and state governments.
The minister further reaffirmed the federal government’s commitment to publish all relevant information on the Paris-London Club refunds to the states.
While Blueprint acknowledges the kind gesture of President Buhari towards alleviating the plight of state governments’ workers we are of the opinion that the channel of achieving this objective leaves much to be desired. Clearly, the governors have not been transparent enough in the handling of the bailout funds, leaving many of the states’ workers still unpaid.
We, therefore, call for thorough investigations into allegations of shady deals surrounding the first tranche of bailout funds with a view to meting out punitive measures, such as forfeiture of the second tranche, to all those indicted. The Buhari government, which rode to power on the crest of change, must ensure that the era of impunity is over.
