President Muhammadu Buhari on Thursday said that it was a matter of great concern to him that nearly two-thirds of states of the federation are still having difficulties with salary payments despite the bail-out funds provided to them by the Federal Government.
He made the remark while speaking at a closed door meeting with members of the Nigeria Governor Forum at the Presidential Villa, Abuja.
Buhari, in a statement by the Senior Special Assistant on Media and Publicity, Garba Shehu, said that he was very disturbed by the hardship which state government workers across the country and their families were facing due to the non-payment of salaries.
To ameliorate the hardship being faced by affected workers, the President said that the Federal Government will strive to make more funds available to the states by expediting action on refunds due to them for the maintenance of federal roads and other expenses incurred on behalf of the Federal Government.
He also said that he will establish an inter-ministerial committee to study a Fiscal Restructuring Plan for the Federation which was presented to him by the governors.
The President said that the committee will review the plan to improve the finances of state governments and make recommendations on how proposals in the plan should be dealt with by the Presidency, the Federal Executive Council and the National Assembly through legislation.
President Buhari urged the governors, however, to understand that while he was ready to do all within his powers to help the states overcome their current financial challenges, the Federal Government also has funding problems of its own to contend with.
The Chairman of the Governors Forum, Governor Abdulaziz Yari of Zamfara State and the Governor Nasir El-Rufai of Kaduna State, who chaired the committee that worked on the Fiscal Restructuring Plan, asked the Federal Government to do more to help the states financially.
The governors told the President that while they had resolved to take other measures to boost their internally-generated revenue, the implementation of the Fiscal Restructuring Plan will help them to deal with their funding problems on short, medium and long-term bases.
They said that if the plan was adopted and implemented by the Federal Government, states of the federation will become more financially empowered to fulfill their constitutional responsibilities.
Speaking with State House correspondents at the end of the meeting, Yari called for amendment of the sharing formula in order to increase federal revenue to state governments.
According to him, it was impossible for state governments to save for raining day with the current 26% allocation to states and 52% to the Federal Government.
On the allegation that the Finance Minister, Kemi Adeosun blamed state governments for their current financial crisis due to their inability to save, Yari said: “The states are only taking 26 per cent whereas the federal government is taking 52 per cent and you are asking us to save?
“Anyway, I doubt if the Minister made that statement or it is coming from the media. The truth remains that the states are taking 26 per cent and the federal government 52 per cent, what are they doing with the money?
“We are not sovereign so how can we save? We are dealing with our different states economy which we are trying our best to fix. Most times, we are busy shouting that what is suppose to be given to us has not been given. For the past three years, we have been asking them to show us if the excess crude has been used judiciously or not.
“So, the question of saving or not does not arise,” he added.
Noting that the meeting is about the economy, he said that the governors passed state-by-state demands to the federal government.
He said: “You will agree with me that states are the landlords, we own the land and the people, so therefore the economy of this country lies in the state. Everything comes from the state, the oil, agricultural produce, mining and people are in the states while the federal government is in Abuja.
“So therefore if any state has any issues and is known to Mr President, I doubt very much if he will be able to sleep with his two eyes closed.
“We are closer to the people and have many challenges in the states. Today we have received support from the Federal Government in terms of bailout, restructured our debts, given us 15% of the Excess Crude Account for development.
“All these are temporal measures. Each state has a programme right from short to mid and long term which we presented to Mr. President and he graciously accepted and he plans to put a committee in place that would look at the matter starting with short term.
“For the short term we are looking at a situation whereby our refunds that are hanging since 2005 right from Obasanjo’s exit of the Paris club, some of the monies that were not paid so that the states that are having difficulties can get money from there.
“Loan restructuring, bailout and ECA, we are asking for 18 months moratorium before we can start paying, so that we would able to strategize.
“To develop IGR is not overnight, it is a long term programme that one has to plan for. And also our workforce have increased and there is nothing we can do about it because people are getting their daily bread from there and we cannot say we are going to cut salaries and wages.
“We have to find a solution otherwise we would keep going back and forth because you will not achieve anything as oil been sold for $100 per barrel is now selling for $28 and $31.
“So therefore we have devised a plan for short term, medium term and long term. These are part of short term.
“As part of the medium term programme, we are looking at the revenue mobilization formula in ensuring that resources which were due for the past 10 years to states will be made available to them after the National Assembly’s approval.
“While the agriculture and mining will be a long term programme.
“The committee that will be set up will have the Vice President, Minister of Power, Works and Housing, Babatunde Fashola will be in that committee because he headed similar committee on revenue formula at the Nigeria Governors Forum in 2012/2013.
“At the same time, some states have committed their resources to some federal government projects like roads and airports, there is a committee that was set up to look into that, we are urging the committee to hasten and complete up their work and present their report to Mr. President so that states can get relief,” he said.
Stressing that the Nigeria Labour Congress’ (NLC) demand for increased minimum wage is justifiable, he urged the workers to exercise patience because of the present economic problem.
He said: “Well, they are right because we agree that what they are being paid is too small. But they must understand the situation the country is because where we are deriving our resources from is now lower by 60 percent.
“So how do we do the magic? But we are going to do our best,” he stated.