Aregbesola is not reckless
These are dedicated workers, excellent human beings, rare breed that can hardly be bettered anywhere in the world. I am happy that a word of assurance has come from the governor that by month end workers are going to smile again.
We, however, need to correct an impression that has gained ground and has largely informed the comments of well-meaning people as opposed to the rabid partisans of PDP and Aregbesola haters who, though appears to be concerned about the workers, but are indeed praying secretly that the governor would not find the money to pay them.
The wrong impression is that Governor Rauf Aregbesola has been engaged in too many projects and that is why he could not pay salaries.
This is false. The barebones is that there is not enough revenue to pay salaries. In 2010 when Aregbesola came in, the total monthly salaries and other emoluments are N1.4 billion out of which pension was N200 million. Today, salaries take N3.6 billion while pension has risen to N530 million.
For those who don’t know, wage bill rises automatically every six months when workers are automatically promoted to the next level. So by the end of this year, Osun would have surpassed the N4 billion mark in wages and this figure will keep growing ad infinitum.
On the other hand, revenues accruable to Osun from the federation account was an average of N4 billion in 2011 up till July 2013 when it fell to N2.6 billion and has been going down until it dropped to N466 million in April 2015.
Indeed, the net statutory allocation to Osun in January was N1.25 billion, February N1.12 billion, March N624 million and April N466 million.
If we add other accruals like VAT, sure-p, excess crude, exchange rate differential etc., January rises to N1.99 billion, February N2.05 billion, March N1.61 billion and April N1.39 billion. Some would then ask: how about deductions for loans taken? Good question.
About N700 million is deducted for loan repayment every month. Add this to any of the figure and do the mathematics and see if it still pays salaries and other emoluments of N3.6 billion every month.
The highest figure of N2.05 billion in February will add up to N2.75 billion and will still be a far cry from the N3.6 billion required to pay salaries and other emoluments.
This, regrettably, is assuming that all the government would do would just be to pay salaries. From the above analysis, what Nigeria is going through is a financial disaster and we should see it as that.
Definitely, it calls for new thinking and a new paradigm on public finance. We must, however, understand this for what it is: a financial disaster ravaging the land.
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