The state government has stated that the N5billion Federal Government bailout loan is the cheapest and most efficient means of paying accumulated arrears of salaries and allowances owed to workers.
The state government has stated that the N5billion Federal Government bailout loan is the cheapest and most efficient means of paying accumulated arrears of salaries and allowances owed to primary school teachers and other local government employees.
The loan also covers arrears of pensions and gratuities owed to retired local government workers, some of which go back several years. In a statement, the state government said that N5billion loan, when received, will bring relief to local councils, their staff and retirees as federal allocations are currently inadequate to meet salary, pension and gratuity obligations at state and local government levels.
A breakdown of the N5b liability shows that as at July 2015, the total salary arrears for Local Government workers was N2, 012, 999, 522.40, while salary arrears for primary school teachers stood at N2, 143, 414, 338.55. Total LG Pension arrears stood at N523, 160, 259.38 while arrears for LG’s Statutory Contribution to Kwara State University (KWASU) are N70,464, 259.89 Outstanding payments for sundry services was put at N267, 806, 538.40.
Providing further clarification, the state government said it is clear from the figures that the N3.6billion combined June and July allocation to the 16 local government councils was inadequate to meet current and outstanding salary and pension arrears not to talk of development projects.
The state government therefore expressed confidence that the N5billion loan bailout will clear all outstanding arrears and provide the local government councils with affordable repayments so that they will continue to meet future salary, pension and project obligations.
The statement also reiterated that the state government does not interfere with local government council funds as all due allocations are released after statutory deductions for teachers’ salaries, pensions and gratuities, teaching service allowance, statutory contributions to KWASU, training, and sundry support services.
It also stressed that bank charges and loan repayments are deducted at source by banks. The state government therefore commended the House of Assembly for its speedy approval of Governor Abdulfatah Ahmed’s request to convert the N5billion arrears into a Federal Government bailout loan and expressed the optimism that the intervention will make salary and pension arrears at local councils an issue of the past.