Breaking the Ghost Worker Rackets

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Olaseni Durojaiye examines the ghost workers syndrome, the mechanism put in place by the Federal Government to fight the scourge and how the malaise stunt socio-economic development

When President Muhammadu Buhari and his party, All Progressives Congress (APC) promised to block all leakages in government revenue and cost centres as one of the tactics to rev up the country’s revenue in the face of dwindling oil price and fund its budget, many did not envisage the enormity of the revelations that the ghost workers saga has revealed across the states of the federation. In fact, not many were aware that the country was losing as much as it was losing to the cartel behind the scam.

No doubt the ghost workers racket has for long lurked around the nation’s civil service sector whether at the local, state or federal government level and the perpetrators annually cream off millions of naira from government coffers into their private pockets for jobs not done. However, what appeared to be news is the alarming number of ghost workers on the payroll of government and the colossal amount lost to the perpetrators of the act, which one analyst described as “anti-productivity.” The discovery may also have revealed how technology can better organise how the civil service is run if adopted.

Besides constituting economic sabotage, THISDAY gathered that the act was capable of truncating government plans as government continues to lose scarce resources, which could have been put to better use.

For instance, while a recent report by the Boston Consulting Group identified infrastructure, education, health, governance and civil society as areas that require immediate attention and outlines the root cause of these challenges and a series of actions that can drive meaningful progress, some observers opined that what is lost to ghost workers would make meaningful impact if channeled into the small and medium enterprise sector. Others argued that the over N2 billion, which was saved by the federal ministry of finance can set up at least one cottage industry in each of the country’s six geo-political zones, which will in turn have a multiplier effect on the livelihood of the beneficiaries.

Taking the Lead
The Federal Ministry of Finance takes the credit for the recent onslaught to fish out ghost workers from government payroll. In late February, the ministry announced that it had eliminated 23,846 ghost workers from its pay roll, thus saving about N2.293 billion monthly in what would have been thought to be remuneration to real workers from government’s coffers.
The feat was achieved through the Bank Verification Numbers (BVN)-based staff audit and enrolment to the integrated payroll and Personnel Information System ( IPPIS). The decision to scrutinise the workforce was in line with the government’s plan to block leakages in government and eradicate corruption to the barest minimum. Besides, observers contended the exercise became more exigent as personnel costs represent over 40 per cent of total government expenditure.

Speaking on the matter, Special Adviser, Media and Publicity to the Minister of Finance, Festus Akanbi, said besides eliminating ghost workers “the Federal Government is also taking actions to pursue recovery of salary balances in bank accounts as well as any pension contributions in respect of the deleted workers. This involves active collaboration with the concerned banks and the National Pension Commission, PenCom,” adding that “this will ensure that all payments are accurate and valid. Requirements for new entrants joining the Federal Civil Service have also been enhanced to prevent the introduction of fictitious employees in future. The ongoing exercise, which is part of the cost-saving and anti-corruption agenda of President Muhammadu Buhari’s administration, is key to funding the deficit in the 2016 budget, as savings made will ultimately reduce the amount to be borrowed,” he stated.

States Take a Cue
Perhaps due to paucity of funds arising largely from the sharp decline in federal allocation to the states, some states government saw wisdom in following in the footsteps of the federal ministry of finance. The staff audit that followed, whether done through a contracted independent consultant as was the case of Niger State or through the now trending biometric technology coordinated by a committee set up by government as is the case of Kwara State, the result has been one discovery after the other. And, as the number of states that have adopted the ministry of finance model increases, so does the discoveries both in number of nonexistent workers and revenue.

In Nassarawa State, consultant handling the exercise across the 13 local governments of the state has uncovered about 1,600 ghost workers. This, arguably, is the least number so far recorded. According to reports, the exercise would save the state N83 million monthly and could rise to N990 million yearly.

Speaking on the exercise while presenting the report to the state governor Umaru Tanko Al-Makura, Executive Director of Skye Bank Plc, Mr. Idris Yakubu, the consultant that carried out the exercise, stated that, “during the exercise we were able to recover over N83 million monthly and if government will implement this it will also run into N990 million yearly,” he stated.
Similarly, in Niger State, the government recently announced that it had uncovered 7, 000 ghost workers in the payroll of its 25 local governments. And like in the other states, conduct of biometric staff verification facilitated this.

According to the Permanent Secretary of the Ministry of Local Government and Chieftaincy Affairs, preliminary reports showed that 3,394 are fake Local Government staff while the rest are teachers in primary schools in the state adding that the exercise became necessary following the huge salary bills that the state government had to contend with following the implementation of the N18, 000 minimum wages.
Interestingly, observers noted that the prevalence of ghost workers in the public sector demonstrates the tardiness in the sector arguing that such would not occur in the private sector as the sector is given to more thorough ways of doing business.

However, while banks seem to be the conduit, civil servants, investigations have revealed, are usually behind the scam as they are the ones that send compiled lists to the banks. Besides, the exercise at the ministry of finance also revealed that several conduit accounts were traced to a single BVN during the verification exercise lending credence to the assertion of a Lagos-based economist, Rotimi Oyelere, that “payments to ghost workers always find their way into the pockets of elite civil servants.”

How to Deal with Ghost-worker Syndrome
Observers all noted that the scam constitute economic sabotage and a drain to the scarce resources of government at the different tiers. THISDAY investigation also revealed that the money lost to perpetrators of the scam is always huge, pointing out that, if not lost, it is capable of aiding development in the country. They added that besides ripping the state off, the perpetrators often become very influential and capable of distorting government’s developmental plans.

According to Oyelere “ghost workers impact government and governance negatively. What it means is that government is paying for inactivity; that is government is paying people who are not contributing to output, which is against the economic principle of cost benefit. Besides, the money usually finds their ways into the pockets of some elite civil servants who think irrationally and who are capable of distorting government policy, Oyelere stated.

Interestingly, while some observers contend that the prevalence reinforces the need for a national identity card to be put in place, arguing that it will check such fraudulent practice, others disagreed. Those who disagreed opined that a national identity card will only reduce to a level it cannot totally eradicate it, arguing that criminal minded people are always a step or two ahead of the society.

“Logically, it is persuasive to share that opinion that a national identity card scheme will eradicate the ghost worker syndrome; but then, people with criminal intentions are more prepared than those who are not. National identity card can be cloned. Even in more technologically advanced societies, people still use other people’s credit cards fraudulently. Criminals are usually one or two steps ahead of society,” stated, public affairs analyst, Sina Loremikan.