Season of Raging Storm Induced by Severance Pay

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Nseobong Okon-Ekong writes that resolution of the federal lawmakers to approve huge severance compensation for themselves portrays the federal lawmakers as insensitive

Since the Chairman, Senate Committee on Appropriation, Senator Danjuma Goje revealed that outgoing lawmakers in the National Assembly have allocated N23.7 billion as severance pay to themselves, there has been a raging storm in the polity attacking the propriety of such an action by the federal legislators. The current anger, however, may be as a result of the comatose economy and the general mood of gloom, which portrays the decision of the lawmakers as insensitive in the face of the prevailing poverty in Nigeria. Otherwise, severance package for public office holders has been legitimised since June 2007, when the Revenue Mobilisation and Fiscal Commission (RMAFC) worked out the current the current remuneration package for political, public and judicial office holders.

Severance gratuity, one of the financial packages approved by the RMAFC for the lawmakers, was arrived at by calculating 300 per cent of the lawmakers’ annual basic salaries.

Given the current state of the economy, the dilemma of millions of Nigerians who bear the brunt of the current harsh realities have not been taken into the consideration by the legislators. It is interesting that when it comes to self-serving matters, the leadership of the National Assembly, who for the greater part of their tenure were engaged in a battle with the executive arm of government act decisively. The National Assembly had increased the 2019 budget proposal by N90 billion before passing it to accommodate the N23.67 billion severance package and other matters. The lawmakers had passed N8.916trn as the budget instead of the N8.826trn earlier proposed by President Muhammadu Buhari.

Whereas the dominant temperament concerning the severance package approved by federal legislators for themselves is that of anger, the actuality is that the law permits it. Dr. Kayode Ajulo, an Abuja-based lawyer and former National Secretary of the Labour Party holds that while these emoluments may appear outrageous emoluments, they are backed by our laws and therefore legally permissible. Section 70 of the Constitution (as amended) empowered Revenue Mobilization Allocation and Fiscal Commission, RMAFC to determine the salary and allowances of members of the senate or house of reps, same with Section 6 of the Revenue Mobilization Allocation and Fiscal Commission Act.

According to Ajulo. “The justification is backed by our law, in as much as some of us may be alarmed and may not desire it, it is legal. It suffices to note that Revenue Mobilization Allocation and Fiscal Commission is empowered by the constitution to determine such allowances to be given to political office holders with regards to present realities. Thus, the payment of severance package to lawmakers is in accordance to law.”

He further aligned with the fundamental emotions which upholds the tough times that the country and her citizens are currently going through. “Considering the present realities, the payment of over N23.7 billion as severance package to lawmakers is not justifiable considering the GDP of the country,” he said.

Another Abuja-based lawyer and former Chairman of the Nigeria Bar Association, Abuja Branch, Mr. Victor Abasiakan-Ekim expressed a different opinion. He insisted that, “There is no legal and moral justification for the betrayal of the trust reposed by the people in the legislature. The office of a federal legislator is not pensionable and any attempt to legislate severance package for themselves amounts to abuse of their office and cannot be justified in any guise.”

Giving more teeth to his position, Abasiakan-Ekim argued that the National Assembly’s resolution runs counter to the spirit of the constitution. In his reckoning, it is in “total disregard to the latent provisions of the constitution. Our federal lawmakers have legislated on and approved jumbo salaries for themselves without recourse to the Revenue Mobilization, Allocation and Fiscal Commission. This bothers on greed, pursuit self-glorification and aggrandizement. The conduct does not take into consideration the plight of the masses and should be deprecated by all and sundry.”

The former Abuja NBA Chairman described the action of the lawmakers as selfish. He said, “These acts of the federal legislators legislating severance packages for themselves cannot be rationalized or justified. It is a clear case of abuse of office. Any law made by the national assembly for the benefit of themselves to the exclusion of the larger interest of the society is built on faulty pillars of greed and avarice. A law ought to be made for the good of the larger society. Roscoe Pound stated that law should be used as an instrument of social development and positive societal change. Can same be said of the severance package bills touted across some states of the federation and the National Assembly? Your guess is as good as mine.”

Both Abasiakan-Ekim and Ajulo were further incensed that a number of former governors who already enjoy similar severance package from their respective home states will also benefit from the financial windfall. Abasiakan-Ekim noted that it was wanton waste of resources, “Majority of the states of the Nigerian federation have passed laws legalizing the payment of severance allowance to former governors including provision pf choice accommodation and personal staff for governors who served for a term of four years or a maximum of eight years of two tenures for life. This is a wanton waste of state resources and to further include these former governors in category of persons to be paid severance package is taking greed to an Olympian height. The law is that one cannot receive pension from two different sources. It goes to show how the political class has betrayed the trust of the people and further throws them into abject poverty by plundering the commonwealth. In the first instance, the payment of the severance package is unconstitutional and illegal and to include former governors in the category of beneficiaries further compounds the issue.”

Ajulo, however, moderated his views by separating the different roles played by the same person as a former governor and later as a senator. He explained, “One may argue that a former governor of a state is entitled to the severance package of such office on the basis that the individual occupied the office as a governor and he is entitled to the benefits accruable to such office and should be without prejudice to being entitled to the severance package given as a former senator. However, the one million dollar question is whether these payment does not amount to double redundancy payment? Logically and legally speaking, this does not amount to double compensation as the individual is being paid based on the office held by such. However, the most important and germane consideration is the state of the economy of the country. Considering the nation’s present economic predicament and the fact that while in office, the beneficiaries earned salaries and allowances considered as unreasonable, to the point that the clamour for cutting the remunerations rages, the determination of the severance package should be on individual basis and regards ought to be made to past political offices held.”

The current debate on the severance package for federal legislators has renewed the clamour for a part-time legislator. Abasiakan-Ekim supports this position. He proposed that, “The amount of financial incentive bandied around and payable at the National Assembly including the severance package certainly fuel the do-or-die attitude of our politicians at elections. The emergence of a candidate as a legislator in the National Assembly is an open ticket to unrestricted affluence. The typical politician can go to any length to secure victory at the polls, including maiming, rigging, violence and the like. There is the need to review the financial incentives to Nigerian politicians. It is my candid view that we do not need arms in the National assembly (Senate and House of Representatives), it is a huge waste of scarce resources. Furthermore, the office of a federal legislator should be one on a part-time basis. The full-time one presently operating is apparently too expensive to run. In a country where minimum wage has just been increased to N30,000 only, less than USD100 how do we justify these jumbo severance packages?”

According to the former NBA Abuja Branch Chairman, it would not hurt the office of the legislators in anyway if the operative cost and incentive is reduced in the National Assembly. “The cost of governance is already too high in all facets of governance. It is only practicable to scale down the cost of operation in the National Assembly including the much talked about severance package. The core civil service is clamouring for a review of salaries and other incentives including the current pension scheme, it is only right for all the arms of government to sit together and carry out a holistic review of the entire process. The legislators are the representative of the people in the National Assembly, hence, their conduct must reflect the wishes, hopes and aspirations of the generality of the people. As at today, there is a huge disconnect between the people and their representative in the hallowed chambers.”

Ajulo took the position that severance allowance in itself is not a bad policy, since it is paid as an appreciation for a meritorious service. He, however, interrogated the propriety of such cash-out. He said, “What bothers my mind is whether the severance packages given to these federal lawmakers are commensurate to work down by them. It is without gainsay that many of these law makers are redundant during their terms in the National Assembly. Only few of them are seen on the national scene, while several others do not even make any laudable contribution and development to their constituencies. Thus there seems to be no justification for the payment of humongous severance packages to these lawmakers.”

The solution proposed by the former National Secretary of the Labour Party is to move away from the current formula. “In determining the salary and allowances of a legislature in Nigeria, the RMAFC should not set their pay by the month, but pro rata. In other words, the salary and allowances so determined must be calculated according to the number of plenary sittings, while work in committees should attract relevant allowances—committee allowance.”

Giving reason for the huge severance package, the chairman, Senate Committee on Appropriation, Danjuma Goje said such package only comes up once in every four years.

“There is a slight increase in the budget deficit. This is as a result of the provision for severance benefits of the outgoing legislators and legislative aides, the induction/orientation and inauguration of new legislators, all of which occur once in four years, but were inadvertently not captured in the 2019 budget proposal.

QUICK FACTS:

* Nigeria has 109 senators. There are 360 House of Representatives members from the 36 states including the Federal Capital Territory

*The basic salary of a Nigerian senator is ₦2,026,400.00, but his an annual allowance may be up to ₦12,902,360

*A Nigerian senator is allowance for utilities, entertainment recess, personal assistant, vehicle fuelling, duty tour, estacode, domestic staff; vehicle maintenance, constituency allowance, wardrobe allowance, house maintenance and newspaper/periodic allowance

*In addition, a Nigerian senator receives an additional sum of ₦24,000,000.00 at the end of his 4-year term in the National Assembly

*Nigerian federal lawmakers are the highest paid lawmakers in the world

*Nigerian lawmakers have allocated N23.7 billion as severance gratuity for outgoing lawmakers of the National Assembly. The sum will also cover allowances for incoming legislators, their aides, funds for National Assembly induction and inauguration of the 9th Senate

*The severance package to federal and state legislators are backed by laws and therefore legally permissible. Section 70 of the Constitution (as amended) empowers Revenue Mobilization Allocation and Fiscal Commission, RMAFC to determine the salary and allowances of members of the National Assembly

*Each senator, with annual basic salaries of N2,026,400.00, is entitled to a severance package of N6,079,200.00 (that is 300 per cent of the basic salary)

*Severance package of each of the 109 senators is N6, 079, 200.00, that of the Senate President, with an annual basic salary of N2, 484, 242.50, is N7, 452, 727.50 while that of the Deputy Senate President, with an annual basic salary of N2, 309,166.75, is N6, 927, 500.25. The total severance package for the Senate amounts to N664, 854, 627

*Severance gratuity is one of the financial packages approved by the RMAFC for the lawmakers. It was arrived at by calculating 300 per cent of the lawmakers’ annual basic salaries. This formula formed part of the current remuneration package for political, public and judicial office holders designed by RMAFC in June 2007

*The Speaker of the House of Representatives earns N2, 477, 110 which brings his severance package to N7, 431, 330.00, while the severance package of the Deputy Speaker, with an annual basic salary of N2, 287, 034.55 goes for N6, 861,102.75. The remaining 358 members of the lower chamber earn an annual basic salary of N1, 985, 212.50. Those of them who would not return will get N5, 955, 637.00 as severance package

*There are 66 senators and 151 Reps who not return to the red and green chambers, respectively in the 9th National Assembly expected to be inaugurated on June 6. This means that the 66 non-retuning senators will be paid a total of N401,227,200 as a farewell package. Similarly, the 151 Reps will be paid a total of N899,301,262.5 to bid farewell to the National Assembly

*Recently, the national minimum wage was increased from ₦18,000.00 to ₦30,000.00

*An average permanent secretary in Nigeria earns between ₦500,000.00 and ₦700,000.00 monthly. These civil servants serve the nation for a maximum of 35 years