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FG May Pay over N300bn as PHCN Severance Benefits

25 Dec 2012

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PHCN office

Chineme Okafor

The total severance benefits payable by the Federal Government may end up expending about N380 billion as total severance benefits to labour unions in the Power Holding Company of Nigeria (PHCN) as against the over N500 billion claim made by the unions.

THISDAY gathered from presidential sources that although the Bureau of Public Enterprises (BPE) is still computing the total amount owed the unions by the government, there are indications that the total the figure might not exceed N380 billion, although the former Minister of Power, Prof. Barth Nnaji had stated that about N443 billion would be used to offset claims by the labour unions.

The sources faulted claims by the National Union of Electricity Employees (NUEE) that government was about to short-change the union, with reports that N170 billion was budgeted to offset their severance benefits and that over N500 billion would be required to offset workers’ gratuity in line with the new agreement signed with Federal Government.

“I am afraid the unions might want to capitalise on this but they should be made to understand that the reported N170 billion is meant for initial payments and not the total payment which is still been worked out by the BPE. I just do not want us to go through the same rat race that we have been going through all these while, said one of the sources, who would not want to be named.

He added: “I am not sure that the claims will amount to the N500 billion that the unions are claiming, one thing that I am so sure of is that the summation of the severance benefits may not exceed N380 billion; give or take about that sum or slightly above that because Prof. Nnaji had indicated that while the disagreement lasted but both parties have shifted grounds so far.”

While calling on the government to swiftly offset the payment to avoid unnecessary change of course by the unions, the source added: “Government should have immediately handed down letters to this effect to the workers, else, the unions may come back to claim otherwise”.  

General Secretary of NUEE, Joe Ajaero had accused the ministry of covert scheme to short-change PHCN workers.

Ajaero said: “For proper implementation of this new agreement, a technical committee to look at the modalities as agreed in the process of negotiation, to ensure that no staff is short changed, should be put in place.

Besides, it is a universally acceptable practice to conduct actuarial valuation before determining the actual worth of any staff’s pensions. We are surprised that the “chewing gum” officials of the Ministry of Power are in a hurry to deliver the pension of workers to their agents in the PFA’s without actuarial valuation.”

Also lending voice to the PHCN labour issue, Chairman of the Presidential Task Force on Power (PTFP), Beks Dagogo-Jack called on the government to expedite action on the payment process.

 “We thank God that we have sat with them (labour) side by side and to me that is like accomplishing 70 percent of what is required, because just getting them to the room was another challenge entirely. But once it is signed, the onus is on government to meet them at their agreed points and there is a committee that will be kicked in to handle the implementation of the agreement” said Dagogo-Jack.

Tags: Business, Nigeria, Featured, FG, N300bn, PHCN Severance Benefits

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