Thursday, June 04, 2020

Post COVID-19: 32 States May Find It Difficult To Pay Salaries - Expert

A governance and policy expert, Dr. Tunji Ogunyemi, has declared that about 32 states of the federation may find it difficult to pay salaries, post Covid-19.

He also said that there was a possibility of a further downward review of the already reviewed Federal Government's budget,  going by recent happenings globally.

The  Economic Historian cum lawyer, and who is also the acting Head, Dept of History, Faculty of Arts, OAU, Ile -Ife, urged the Osun State Government to meet with the Labour  leaders in the State with a view to revisiting the Comrade Hassan Sumonu-led CCommittee's template, insisting that the State would be negatively impacted by the global economic downturn occasioned by Covid-19.

Dr. Ogunyemi stated these on Wednesday  while featuring on a popular radio programme tagged 'Frank Talk', in Osogbo.

"The Federal Government can deliberately create money by printing more money that may not be backed by productivity to pay its workers.

"But no State can do that. Already, states are cutting their budgets significantly because of the drop in the federal allocation. What they will be sharing in June is half of what they shared in January. Only about four states can manage to survive marginally.

"The opportunity that the civil servants have now is that no State can say go home, I am not paying. But States can decide to pay slashed salaries because one cannot appropriate and reprobate at the same time. So, the State can only pay from what it has. If it has nothing, what will it pay?

"We are in dire straights. Some states like Kaduna, Delta, Plateau, Taraba, Gombe, among others, are slashing the salaries.

"Though it is rather very difficult to advise the beleagured Governor Oyetola because I know  there will be a lot of calculations in his head now to which there are few answers. But the advice must be based on the foundation of the challenges that Osun is facing.

"Osun pays three quarters of its income into recurrent, salaries, wages and overheads, including liabilities owed the pensioners. Osun also has a background of owing a significant debt both domestically and externally going towards the realm of N200 billion.

"From that background coupled with 30 Local Governments with huge civil servants, one would rather advise Comrade Hassan Sunmonu, Chairman of the Committee of Government and Labour, to share some views with the governor by calling on the civil servants to know the truth about the financial status of the State.

"Politicking should end here. Some professionals can be called to that kind of meeting, especially experts in public finance and banking to let the truth be told on the status of Osun.

"When an income is far, far less to expenditure, and there is no extra capacity to generate more, it means that the State must  begin to reduce wasteful expenditure.

"So, government must pursue the idea of land charges, cut down if not suspend capital expenditure to pave the way for the maintenance of minimum services of government.

"Also, for the State to stay afloat, then people must prepare for the impact. They must support government and show patriotism in view of the socio-economic reality.

"Reality is staring us in the face and for the clouds to clear, it will take five years or more"

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