FG, PHCN Workers In Fresh N250bn Pension Row

The Federal Government and workers in the electricity sector may resume talks on the controversial issue of pension and gratuity of workers of the Power Holding Company of Nigeria next week. Saturday PUNCH investigations show that the meeting might however not lead to any positive results since the parties involved in the dispute, the FG and the National Union of Electricity Employees and the Senior Staff Association of Electricity and Allied Companies, are not willing to shift ground. While union leaders in the sector insist on the payment of N540bn as pension and gratuity to workers of the PHCN entities that are being unbundled, officials of the government have concluded that not more than N200bn will be expended on the payment of pension and gratuities to the workers. A labour leader currently occupying a strategic position in the country said it would be impossible for the FG to accede to the workers’ demand, which “it considers to be unreasonably high.” The FG Negotiation Committee headed by the Secretary to the Government of the Federation, Anyim Pius Anyim, has not called another meeting since the last one, which coincided with the sacking of the then Minister of Power, Prof. Bath Nnaji, ended in a stalemate on Aug. 29, 2012. Investigations show that the long delay in the resumption of the negotiations has caused frustration among the leaders of trade unions within the electricity sector, who are negotiating through the Nigeria Labour Congress and the Trade Union Congress. A labour leader, told our correspondent that the FG was deliberately frustrating the talks by not inviting the unions for discussions. However, the unions had already concluded plans to spring a surprise on the government by instituting a legal action against the ongoing reforms. On Thursday, a top labour leader in the country told our correspondent that a compromise was not in sight in the dispute between the government and the workers over the issue of pension and gratuity. Investigations showed that the talks between the unions and the government were stalled because the unions in the sector did not come up with a position which could “be taken to the negotiation table with the government’s formidable team.” It was gathered that the FG was waiting for organised labour and its allies in the sector to resume the suspended talks on the modalities and amount that should be paid as gratuities to the PHCN workers. The dispute over the pension and gratuities of PHCN workers deepened as the investigation committeee on PHCN, headed by a former Auditor General of the Federation, Mr. Joseph Ajiboye, made some recommendations. The committee queried the pension arrangement in the PHCN, which pays 25 per cent of the total emolument of the workers as pension and gratuity instead of 25 per cent of the basic salaries of workers. The Ajiboye panel indicted the board of the PHCN for approving the policy change from 25 per cent of basic salary to 25 per cent of total emolument. The shift in policy is said to be at the root of the current face-off between the government and PHCN workers. The panel, which recommended the sanctioning of the then board of the PHCN, said the decision impacted significantly on the pension liabilities of the FG to PHCN workers to the tune of N14bn. On the question of the N14bn gratuities and pension liability in the schedule of total indebtedness as of 23rd July, 2012 submitted by PHCN, the panel was informed that it arose as a result of the change in the basis of computing the PHCN’s commitment to the Superannuation Fund from basic salary to total emolument of the staff. It was learnt that the government was more inclined to the enforcement of the recommendations of a Sub Committee on Negotiation with PHCN and Labour under the leadership of a former Permanent Secretary in the Ministry of Labour and Productivity, later Information, Dr. Timiebi Koripamo-Agary. It was the position of the Agary Committee that the issue of PHCN workers pension and gratuities be resolved in accordance with the stipulations of the 2004 Pension Act. Koripamo-Agary recommended that the rights of the affected members of the staff of the PHCN should be transferred to the retirement savings account with effect from 2004 when the Pension Act took effect and be provided with the 7.5 per cent contribution expected from the employer as stated in the act. Koripamo-Agary’s recommendations were accepted by the Ajiboye committee, which believed that they were fair and in accordance with the positions of the law. The committee further recommended that N35.4bn be estimated to take care of the 15 per cent total contribution the employees were entitled to. The recommendations of the committee include the termination of the NEPA/PHCN Superannuation Fund Scheme as of June 30, 2004, and the implementation of the transnational provisions of the Pension Reform Act (2004). The committee stated, “Transfer the accrued persons rights of staff as of June 30 2004 to their retirement savings account; provide 7.5 minimum employer contribution on active employee monthly emoluments from 1st July 2004 through June 30 2012, and “to pay the outstanding 7.5 per cent for the employees: The committee agreed that “the sum of N35.4bn is estimated for the 15 per cent total contribution to be paid into the employees’ retirement savings account (that is, 7.5 per cent employee contribution and 7.5 per cent employee’s contribution.” When our correspondent contacted the President of the NLC, Mr. Abdulwahed Omar, on the telephone, he said that it was the expectation of labour that the government would take the issue of the payment of the severance allowances seriously. He added that the discovery of pension funds in foreign accounts in the United Kingdom should strengthen the management and put them in a better position to carry out necessary payments.