Former Governor of Ogun State, Senator Ibikunle Amosun has kicked back at the Dapo Abiodun-led government, which had accused the erstwhile administration of negligence in an unpaid ₦106.9 Billion gratuity; leave bonus, contributory pension and promotion arrears due to workers, a situation that led to a strike action by labour union in the state on September 16, 2020.
In a rebuttal statement Friday titled- Ogun State Workers Strike Putting The Records Straight (2011-2019), signed and sent to Echotitbits by the Secretary to the State Government (SSG) in the Ibikunle Amosun administration, Barrister Taiwo Adeoluwa, stated that: “our conscious decisions to stay in our lane were violated last week during the well-publicized Ogun State worker’s strike. In the defense by the current administration, references were made to matters relating to our administration which we believe for reasons of posterity needed to be corrected”.
Adeoluwa, accusing the Dapo Abiodun-led government of overstating an amount of N9.6B in figures pertaining to gratuity stated that: “A total sum of ₦22.9B was the outstanding Gratuity for Local Government and SUBEB as against the ₦32.5B published.
“It is instructive to note that a backlog of 3 years left by the previous administration was paid by our administration.”
The Amosun administration equally said it discovered that the liability under Leave Bonus was overstated by ₦1.6B as against the actual outstanding liability of ₦7.6B an amount of ₦9.6B was claimed in the publication.
“As we have done with all other staff related liabilities inherited by us from the previous administration, we also paid all outstanding inherited Leave Bonus liability from the previous Administration”, Adeoluwa stated in the statement.
Reacting to pension issues raised, the Amosun-administration said it identified the Contributory Pension Scheme as a very tricky one.
While it stated that the total liabilities stood at ₦41.4 Billion (State – ₦20.03B, LG & SUBEB – ₦21.37B), the Amosun-admiistration said it cannot be held responsible for the outstanding debts of ₦41.4B attributed to us.
”It was a good initiative, but badly implemented without cash backing by the administration before us. This led us to engage the Labour leaders, and subsequently the law setting up the scheme was therefore reviewed – allowing workers that will be retiring on or before 2025 to have the opportunity of opting for the old pension scheme arrangement.
“This obviously resulted in many civil and public servants opting for early retirement leading to high increase in the amount of resultant Gratuity liabilities and payments. We did this review to correct the faulty implementation of the programme and to give enough time to provide adequate fund (sinking fund) for effective and seamless running of the programme.
“We noticed also that the amount of ₦46.5 Billion published as the outstanding Contributory Pension liabilities was overstated by ₦5.1 Billion. As the total liabilities stood at ₦41.4 Billion (State – ₦20.03B, LG & SUBEB – ₦21.37B). Respectfully, we cannot therefore be held responsible for the outstanding debts of ₦41.4B attributed to us.”
On the issue of promotion arrears, the Amosun-administration said since by convention, the exercise for promotion for year 2018 will have to be conducted in 2019. It was the responsibility of the new administration to oversee the subsequent ones beginning from 2018.
It added that: “We conducted the one for year 2017, and was duly cash backed and paid.
“In view of this, we do not owe the ₦217M in respect of Promotion Arrears, as claimed in the publication.
“We wish to place on records that we made full disclosure of our financial status and deliberately included that of SUBEB and LGAs. This is more than we got when we took over government.
“The declared liabilities of ₦49.23B passed on to us by the previous government carefully excluded amounts outstanding and owed to the other tiers of government (the Local Government) which was material in amount, and all of which our Administration have since paid.
“We gained from our experience and financial analysis that without attaining a financial break-even point in the state IGR, the State will continue to lag behind in development. The foundation and trajectory for further growth of the State IGR which we had established ought to be reinforced by the current and indeed all succeeding Administration in order to meet up on its financial obligations to the Ogun workers and indeed all the good people of Ogun State.
“From the critical analyses and review of Ogun State finances vis-à-vis the current and future financial needs and development of the State, the financial break-even point for the State will be if and when the State attain the Internally Generated Revenue (IGR) figure of at least ₦12.5 Billion. Without this, succeeding Administration will continue to encounter the same financial difficulties and crises.
“From the Financial Outlook of the State as contained in the Ogun State Development Plan (2017-2030), we were confident to predict that by year 2022, the State’s IGR will be between ₦12 Billion to ₦14 Billion monthly, while a further projected figure put it at ₦20 Billion per month by year 2025. This is no rocket science, but an outcome of a coordinated approach and well articulated plan laid out by our Administration.
The Amosun-administration however concluded that: “in light of this, it is expected that any succeeding administration after us will continue with the Ogun Standard way of thinking out of the box in order to take our dear State to the highest pedestal, whose foundation had already been laid by our Administration and the Contributions and Efforts of those GIANTS that came before us”.
In a statement issued September 17, where the state government reacted to the dispute and strike notice by labour in the state, the Secretary to the State Government, Mr. Adetokunbo Talabi, informed the striking workers that the state government inherited N106.9billion unpaid welfare package.
Talabi noted that government considered the abrupt withdrawal of the labour team and unilateral declaration of one-week strike as unfair, indecorous and violation of the principles of collective bargaining, adding that it was a surprise that labour would take the step even when the negotiation process was still on.
Read full text of the Amosun-administration rebuttal statement below.
OGUN STATE WORKERS STRIKE PUTTING THE RECORDS STRAIGHT (2011-2019)
Since we left office in a blaze of glory and total thanksgiving to Almighty God after our tour of duty in May 2019, we have consciously refrained from joining issues with the successor regime in our beloved State. Despite mis-statements of facts in respect of programs and projects of our administration, we were resolved to keep our peace. Having done our level best for our people, we remain grateful to God Almighty and the good people of Ogun State for the opportunities availed us and for the privilege and enablement signposted by numerous legacy and life changing accomplishments that attended our administration.
2. However, our conscious decisions to stay in our lane were violated last week during the well-publicized Ogun State worker’s strike. In the defense by the current administration, references were made to matters relating to our administration which we believe for reasons of posterity needed to be corrected. TO BE PRECISE, IN THE NEWSPAPER
ADVERTS ON FRIDAY, 18 SEPTEMBER, 2020, OUR ADMINISTRATION WAS ACCUSED OF LEAVING AMOUNT TOTALING N106.9 BILLION UNPAID IN RESPECT OF OGUN STATE WORKERS GRATUITY, LEAVE BONUS, CONTRIBUTORY PENSION AND PROMOTION ARREARS.
3. Our experience when we assumed office in May 2011 was not palatable. We met a State in dire need of urgent attention and timely intervention. In fact, we met a far more precarious Ogun State where there was near total absence of security for both lives and properties. Banks and other financial institutions could not operate anywhere in the Ogun East Senatorial District. The industrial climate was in comatose. Cultism, Kidnapping, Ritual related murder and unresolved assassination were the identities of a once peaceful and progressive people of Ogun State. In the World Bank Ease of Doing Business 2010 ranking, Ogun State was ranked 36 out of the 37 States including FCT peer reviewed. It was also adjudged the worst State to live by several reputable rating bodies. Infrastructural deficit, decay and retardation were common place. But with the help of God and the support of the good people of Ogun State, we are humbled by the well acknowledged testimonial that we left behind a peaceful, prosperous, and progressive State that we are so proud of, and were so proud to serve.
4. On the issue of Ogun State workers, our administration inherited accumulated arrears of unpaid salaries Deductions, pension, gratuity and associated liabilities. The then outgoing administration on the eve of the elections, committed to a number of new liabilities under pressure and retrospectively backdated in some instances the commencement from January, 2009. For instance, pension payments to retired Permanent Secretaries and Heads of Service got jacked up by Executive fiat from ₦40,000 to ₦400,000; and, from ₦45,000 to ₦450,000; monthly, respectively. The implication was that from the end of our first full month in office, June, 2011, the monthly pension of civil and public servants went up astronomically. We paid this unfailingly throughout our tenure; May, 2011 – May, 2019.
5. Then came the National minimum wage barely a few days after we took office. Ogun State under our watch took the credit as the first State in the South West to begin the payment of that new minimum wage in August 2011, applying fully the Consequential Adjustment that benefited all cadre of staff from Level 01 to 17. With that, the monthly emoluments paid to Ogun State workers, both civil and public servants increased by more than ₦1.6 Billion monthly within the first Three (3) months of our administration. We are grateful to God that despite the enormous wage bill, we did not owe monthly salaries and pensions (both to State and Local Governments) from May, 2011 to May, 2019, and we cleared all salary deductions for the same period before we left office.
6. To put the record straight and for the purpose of posterity, we shall hereby address the issues relating to the financial liabilities of ₦106.9 Billion claimed to have been left unpaid by our administration.
A GRATUITY
(i) (State Workers)
YEAR AMOUNT PAID
Jan 2009 – May 2011 ₦ 5,642,119,495.41
June 2011 – Dec 2013 ₦14,977,316,036.44
Total (Paid) ₦20,619,435,531.85
Jan 2014 – Dec 2016*** ₦10,808,277,510.65
Total (Assumed Paid) ₦31,427,713,042.50
Outstanding Liability
YEAR AMOUNT OWED
Jan 2017 – May 2019 ₦7,635,425,007.44
***The ₦10.6B refund from the Federal Government owed to our administration and earmarked specifically (and which was clearly stated in the handover notes) for the Gratuity payment for period January 2014 to December 2016 was blocked together with the ₦5.7B May 2019 Statutory Allocation from the Federation Account (which was to be used specifically to augment the May, 2019 Workers’ Salary) by the present administration in early May 2019, before they assumed office. The refund of ₦10.6 Billion was paid in early July 2019, barely 6 weeks into the new administration, while the ₦5.7 Billion was paid in the first week of June, 2019.
A total of ₦20.69B was paid and ₦10.6B provided for, totaling ₦31.4B by our administration for the period between January 2009 to December 2016.
For the record, the total outstanding Gratuity to the State workers stood at ₦7,635,425,007.44 at the end of our administration in 29 May, 2019.
(ii) Local Government and SUBEB as at May, 2019)
SUBEB – ₦18,705,681,760.97
Local Government – ₦4,208,956,965.27
TOTAL – ₦22,914,638,726.24
A total sum of ₦22.9B was the outstanding Gratuity for Local Government and SUBEB as against the ₦32.5B published. Leaving an overstated amount of ₦9.6B.
NB
It is instructive to note that a backlog of 3 years left by the previous administration was paid by our administration.
B. LEAVE BONUS (2015 – 2019)
State – ₦3,824,481,744.82
SUBEB – ₦3,191,491,652.00
LGEA – ₦ 598,438,577.67
₦7,604,411,974.08
We equally discovered that the liability under Leave Bonus was overstated by ₦1.6B. As against the actual outstanding liability of ₦7.6B an amount of ₦9.6B was claimed in the publication.
NB
As we have done with all other staff related liabilities inherited by us from the previous administration, we also paid all outstanding inherited Leave Bonus liability from the previous Administration.
I. CONTRIBUTORY PENSION LIABILITIES
The Contributory Pension Scheme has been identified as a very tricky one. It was a good initiative, but badly implemented without cash backing by the administration before us. This led us to engage the Labour leaders, and subsequently the law setting up the scheme was therefore reviewed – allowing workers that will be retiring on or before 2025 to have the opportunity of opting for the old pension scheme arrangement. This obviously resulted in many civil and public servants opting for early retirement leading to high increase in the amount of resultant Gratuity liabilities and payments. We did this review to correct the faulty implementation of the programme and to give enough time to provide adequate fund (sinking fund) for effective and seamless running of the programme. We noticed also that the amount of ₦46.5 Billion published as the outstanding Contributory Pension liabilities was overstated by ₦5.1 Billion. As the total liabilities stood at ₦41.4 Billion (State – ₦20.03B, LG & SUBEB – ₦21.37B). Respectfully, we cannot therefore be held responsible for the outstanding debts of ₦41.4B attributed to us.
II. PROMOTION ARREARS
By convention, the exercise for promotion for year 2018 will have to be conducted in 2019. We conducted the one for year 2017, and was duly cash backed and paid. It was the responsibility of the new administration to oversee the subsequent ones beginning from 2018. In view of this, we do not owe the ₦217M in respect of Promotion Arrears, as claimed in the publication.
7. We wish to place on records that we made full disclosure of our financial status and deliberately included that of SUBEB and LGAs. This is more than we got when we took over government. The declared liabilities of ₦49.23B passed on to us by the previous government carefully excluded amounts outstanding and owed to the other tiers of government (the Local Government) which was material in amount, and all of which our Administration have since paid.
8. We gained from our experience and financial analysis that without attaining a financial break-even point in the state IGR, the State will continue to lag behind in development. The foundation and trajectory for further growth of the State IGR which we had established ought to be reinforced by the current and indeed all succeeding Administration in order to meet up on its financial obligations to the Ogun workers and indeed all the good people of Ogun State.
From the critical analyses and review of Ogun State finances vis-à-vis the current and future financial needs and development of the State, the financial break-even point for the State will be if and when the State attain the Internally Generated Revenue (IGR) figure of at least ₦12.5 Billion. Without this, succeeding Administration will continue to encounter the same financial difficulties and crises.
9. The improved SECURITY and massive INFRASTRUCTURAL DEVELOPMENT embarked upon by our Administration
resulted in improved economic activities which attracted private sector participation of both Local and Foreign Direct Investments which in turn led to the massive increase in the IGR from the paltry ₦700 Million monthly that we met upon assumption in May, 2011, to about ₦7 Billion monthly by the time we left in May, 2019. Indeed, in the year 2016 and 2017 Report by the Manufacturers Association of
Nigeria (MAN) and the report conducted by Price Waterhouse Cooper (PWC), Ogun State was adjudged to have attracted 75% of all manufacturing related FDIs into Nigeria. Under our watch, Ogun State became the Industrial Capital of Nigeria. We are humbled that we attracted over 140 new Industries which individually invested between $200 million and some few instances up to $2 billion in Ogun State. One of such Industries is the $250 million International Breweries Plant in Bara, Obafemi Owode Local Government. The plant is the largest investment of the ABInBev Group in Africa, outside of South Africa. This is not to mention several others who invested below $200 million individually.
All of these were made possible through our financial re-engineering and the enabling environment that our Administration provided for businesses to thrive.
If our Administration could increase the State IGR astronomically from N700 million monthly to N7 billion monthly within the period of 8 years (2011-2019), then, clearly, there is NO CAUSE FOR ALARM.
CONCLUSION
10. Let it be noted that our Administration did not start from ‘Ground Zero’ in terms of outstanding liabilities related to Ogun State workers – Salary, Emoluments and Allowances. Rather, with the help of God and the support of the good people of Ogun State, as well as our Administration’s commitment and resolve to leave Ogun State better than we met it, we are proud to say that we have been able to put our dear State on auto drive, particularly in the area of improved IGR. The Ogun State we left behind can be likened to an Economic Volcano that is already erupting!.
From the Financial Outlook of the State as contained in the Ogun State Development Plan (2017-2030), we were confident to predict that by year 2022, the State’s IGR will be between ₦12 Billion to ₦14 Billion monthly, while a further projected figure put it at ₦20 Billion per month by year 2025. This is no rocket science, but an outcome of a coordinated approach and well articulated plan laid out by our Administration.
11. In light of this, it is expected that any succeeding administration after us will continue with the Ogun Standard way of thinking out of the box in order to take our dear State to the highest pedestal, whose foundation had already been laid by our Administration and the Contributions and Efforts of those GIANTS that came before us.
12. Finally, we thank the organized Labour in Ogun State for calling off the strike. As two wrongs will never make a right, we encourage Labour to consider that though strike is a legitimate weapon to drive demands, it should always be the last resort for reasons that the good people of Ogun State will ultimately be the victims of such disagreement between Government and Labour. As stakeholders, we all must endeavor to cast differences aside and work together for the development of our great State.
God bless Ogun State.
Barrister Taiwo Adeoluwa
Secretary To The Ogun State Government (2011-2019)
Dated this 24th September, 2020.
Abeokuta, Ogun State
By Tobiloba Kolawole
