ASABA/Nigeria: The Association of Local Governments of Nigeria (ALGON), Delta State chapter, held a press conference on Monday to address reports circulating in the media regarding a N40 billion loan acquired to settle the accrued rights owed to primary school and local government pensioners in the State.
Speaking at the meeting of the Joint Account Allocation Committee (JAAC) in Asaba, Hon. Victor Ebonka, the State ALGON Chairman, clarified that it was not the State Government that borrowed the funds. He emphasized that it was the statutory duty of Local Governments to pay pensions to their retirees, including those from the Local Education Authority (primary school retirees).
Ebonka explained that theschemes arose due to an error in the enrollment of workers into the contributory pension scheme. He stated, “In this country constitutionally, we have three tiers of government: the Federal, the State, and the Local Governments. We all have separate responsibilities. It is our constitutional responsibility to pay the Local Government staff and primary school teachers’ salaries.”
The ALGON Chairman acknowledged the existing challenges with the pension benefits of Local Government staff and primary school teachers, which had been inherited from previous administrations. The problem stemmed from an error in the enrollment process for the contributory pension scheme.
“We have found ourselves owing their accrued rights from 2016 to date. The past administration set a machinery in motion and has tried to ensure that the debt is liquidated by giving several grants totaling about N5 billion and increased statutory contribution from N200 million a month to N500 million,” Ebonka explained.
He further revealed that despite the grants provided by the State Government, the outstanding arrears could not be cleared. Consequently, the immediate past administration established a committee, comprising the ALGON Chairman, the Head of Service, and other stakeholders, to address the issue. The committee sought a facility from the bond market but was unsuccessful due to high costs. Eventually, Zenith Bank agreed to provide a loan of N40 billion out of the N51 billion owed to the pensioners.
Ebonka clarified that the State Government did not borrow N40 billion, as reported by some media outlets. The State Government’s role was limited to granting approval and forwarding it to the State Assembly for ratification. He stated, “So it is exclusively the Local Government Councils that are borrowing this money. You know that by law, we need the approval of the State Government and the ratification of the State Assembly, and that was sought and granted by the Governor and approved by the State House of Assembly.”
He assured the public that the pensioners would soon receive their payments, noting that none of the N40 billion loan would go into the coffers of the Local Governments. “We are going to cover about ninety percent of the accrued rights from this money; all of the monies will be paid directly to the pensioners,” he added.
The ALGON Chairman also addressed the issue of environmental sanitation across the Council areas. He appealed to residents to abide by relevant laws and announced that mobile courts would be established to try offenders soon.
