Before Paris Club Final Tranche is Paid
On Tuesday last week, a Nigeria Governors Forum [NGF] delegation led by its chairman, Zamfara State governor Abdulaziz Abubakar Yari was at the State House in Abuja and had a meeting with President Muhammadu Buhari. Other members of the delegation were Akwa Ibom State Governor Udom Emmanuel, Bauchi State Governor Mohammed Abubakar, Kebbi State Governor Atiku Bagudu, Kwara State Governor Abdulfatah Ahmed and Ebonyi State Deputy Governor Kelechi Igwe.
The governors had a two hour meeting with Buhari, during which they asked him to release to them the 50 per cent balance of Paris Club refunds so that they will include the money in their 2018 budgets. Yari told reporters that the visit was sequel to an earlier meeting of the National Economic Council (NEC) meeting which, he said, sent them to thank Buhari “for his concern about the state of the economy by giving us several supports ranging from bail outs, restructuring of our debts to the London-Paris Club exit payment.”
In classic Oliver Twist fashion, Yari said, “As a father, we said to him to remember that in 2016 we presented the numbers of London and Paris exit funds which we agreed, and he directed that we should be paid 50 per cent and 50 per cent upon reconciliation. Reconciliation has been on since 2016. We are hoping that the Debt Management Office (DMO), Ministry of Finance, AGF and our consultants will conclude this reconciliation by November. So, we want to crave [the president’s] indulgence so that we factor in the numbers into our 2018 budgets so that we can use it for projects and other recurrent spending according to the specification given by our respective Houses of Assembly and that is why we are here.”
Problem is, Presidency had earlier disbursed N760.17 billion in two tranches to the state governments as refund for over-deduction from their allocations from the Federation Account for external debt servicing between 1995 and 2002. Last July the Federal Government released details of the second tranche of Paris Club refund to states totalling N243.795 billion. Late last year, state governments had received the first tranche of the refunds worth N516.38 billion. Many Nigerians now accuse many state governments of mishandling these Paris Club refunds and are therefore opposed to any more payments until adequate safeguards are put in place.
Last month for example, the Nigeria Labour Congress (NLC) urged the President not to release the third and final tranche of the refunds to the governors until they make a concrete commitment to use the money to settle outstanding salaries, allowances and pension of workers and retirees in the country. NLC’s communiqué signed by its President Comrade Ayuba Wabba and General Secretary Dr. Peter Ozo-Ezon also asked the federal government to compel state governors to properly account for the bailout they received from the federal government as well as the two tranches of the Paris Club refund which was supposed to be used for the payment of salaries and pensions, but diverted to other uses. The union said “It reviewed the continuous non payment of months of outstanding salaries of workers in some states of the federation as well as various arrears of pension which has also run into several months which is the actual situation despite President Buhari’s passion to address this matter since he assumed office by giving bail out to governors to clear this shameful state of affairs with the nation’s workforce.”
President Buhari too was reported last month to have decried the handling of Paris Club refunds by many state governors. He made the remark at a meeting he had with members of the National Council of Traditional Rulers. He frowned at the inability of many state governments to pay the retirement benefits and outstanding salaries of workers with the refund. He said, “There are Nigerians that haven’t been paid for six months. There are Nigerians that have not been paid their retirement benefits for years. I’m appealing to the governors (that was why we voted money, we borrowed money), please make sure anybody under you, pay them because most of them depend on that salary to pay rent, school fees.’’
Bauchi State Governor Mohammed Abubakar was quoted last week as having told reporters after a meeting at the APC national secretariat, “Don’t forget, this is money that belongs to us. We are not begging for anything but demanding what belongs to us and that it should be paid to us.” It is in the same vein that workers and other citizens are clamouring for the refunds to be put to the best use in the states, principally by paying workers and pensioners their accumulated salary and pension arrears. It is true that state governments have many other things that they will want to do in terms of projects but the people must survive first before anything else.
Since the tranche that the governors are clamouring to receive in November is the last one and no one knows when state governments will get any other substantial amounts of money, the clamour is in order for them to use these funds to clear salary and pension liabilities so that they can now begin on a clean state. We sympathise with some of the governors who inherited most of the salary and pension liabilities from previous administrations but government is a continuum and they must clear these liabilities. We entirely support the idea that the last tranche should be paid only after the states agree to a firm commitment to use them to clear these liabilities before they do anything else.