Why Most States Cannot Pay Workers
Salaries
Dr Joe Abah (a.k.a Eze Mmuo) - February 10, 2018
This morning, I want to talk about why I think some states don’t pay salaries. As always, my intention is to explain, not to justify. It is immoral and wrong not to pay ANYBODY that has done agreed work, both in public and private life: civil servants or domestic staff. Thread…
Many states are public service states. In some, the main economic activities in the state revolves around the public service. The only good jobs available are public service jobs. Public servants are the elite. Everybody’s ambition is to join the public service. It’s prestigious.
The public servants are, if you like, the representatives of those in the rural areas. They are the educated elite who tell others what to do, even what to think. The salary of each public servant supports 30 dependents. They know how to write petitions. You don’t mess with them.
Because each salary supports 30 people, having high salary costs as a percentage of the budget is not seen by the people as a big deal in the states. It is seen as a means of direct distribution. So, a governor MUST recruit...and pay...and do infrastructure. Borrow, if necessary!
In some cases, personnel costs consume as much as 90% of state resources, even though the public service of that state is much less than 5% of the population. If you sack people, you’ll lose elections. It’s that simple. You may be forgiven if you sack AND REPLACE, like el Rufai.
So, you have less than 10% of resources available to spend on infrastructure, healthcare, education, security, youth, etc. As a governor, you know that if you don’t build roads, you’ll lose elections. If you don’t build gigantic structures in bricks and mortar, you lose elections
Now, assume that you defeated the incumbent governor to become governor. A month before he hands over, he will recruit an additional 10,000 people and dump them on you. They’ll report for work IMMEDIATELY! When you are sworn in, to sack them is a problem. To pay them is war.
At a point, Ekiti State which has about the smallest allocation from the Federation Account had the largest civil service in the country: 60,000 people. Even the Federal Civil Service is only 82,000 ...and some people say it is bloated. You take over as a governor, in shock!
Now, the public service in the states are TOTALLY politicised. EVERYBODY ACTIVELY belongs to the ruling party. The main preoccupation of the civil service is party politics. Any contestations are within the same party. The only exception I’ve seen is Ekiti: about 50% APC; 50% PDP
Remember I said if you don’t do roads and build white elephant projects, you’ll lose. The same civil servants will tell the whole world that you are not doing anything, so you are not sure of their loyalty. There is no money. People that invested in your election are waiting…
So, to get anything done, you have no choice than to borrow. If you ask your Ministry of Works or Education to give you a quote for re-roofing a school, they’ll quote N50 million. You know you can do it for N5 million. You ignore the Ministries and do it yourself directly.
Because each successive governor has ignored them, they haven’t done any work in years and years. Any capacity they came to the Service with is now COMPLETELY lost. Indeed, you’ll need some convincing that some even have degrees. Many have fake degrees but that’s for another day.
So now, as a governor, you are asking yourself why you should be spending 90% of State resources on this “useless, unproductive” 2%. You find it totally maddening. You can’t raise taxes either. You can’t make enough money to be politically independent of your political sponsors.
Because capacity is so low and the cost of going through the public service is so high, you bring in your own staff and just award contracts from government house. You decide to throw a big party for your wife. The civil service prepares its dossier for EFCC when the time comes.
The choices before you are stark:
1. Do the right thing, sack some and risk your political future
2. Continue to pay them, do no projects and lose re-election
3. Borrow massively to do projects and leave the Federal allocation to them
4. Raise IGR, annoy market traders and lose.
Many governors will choose Option 3 and borrow massively. The problem comes when you’ve borrowed so much that you can no longer service the debt. You can’t afford to default on your loans. FGN guarantees international ones and will deduct at source. Local debtors don’t give time.
All of a sudden, you realise you can’t pay salaries. You promise them you’ll pay. Don’t forget that 30 people depend on EACH salary. The heat is so much that you start looking to borrow more. If you get “bail out funds”, you either want to do projects or pay other debts.
Since the public service has captured 90%, if you don’t do projects, you don’t make any money for yourself in kickbacks. So you build schools nobody needs, a state university or even an airport with the bailout funds. You continue to owe, and that’s how the cookie crumbles. End!
SOURCES
https://twitter.com/DrJoeAbah/status/962235146933071872

True....very true.

shervydman:
True....very true.

Extremely true so who will break the wheel

sultaan:


Extremely true so who will break the wheel

Restructuring........ resources control by states.

shervydman:
Restructuring........ resources control by states.

That means some state will inevitably collapse.

patakioy:

That means some state will inevitably collapse.

No, they won't collapse..... all they need is to look inward and generate revenues, every states in Nigeria have huge potentials

What a dilemma....