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29 June 2018

Salaries delay likely over FAAC deadlock, says minister

Workers were put on notice yesterday not to expect an early salary this month.

Reason: Governors’ meeting with the Federation Accounts and Allocation Committee (FAAC) ended in a deadlock.

If the issues are not resolved, Finance Minister Kemi Adeosun said,  salaries may be affected in the states.

FAAC members, she said, felt that some of the costs presented by the Nigerian National Petroleum Corporation (NNPC) could not be justified, hence they decided that rather than approve the accounts, the negotiations will continue.

She said President Muhammadu Buhari and Vice President Yemi Osinbajo were briefed and supported the Ministry of Finance and the commissioners for finance not to approve those accounts until further explanations on some of the costs being implemented are given.

The revenue sharing meeting ended in a deadlock on Wednesday – for the third time since January 2018.

The National Economic Council (NEC), presided over by Prof. Osinbajo, has demanded explanations from the NNPC for unclear costs the corporation made from FAAC.

Finance Commissioners, who converged on Abuja with the expectation  to collect their states’ share of the monthly allocation, reportedly walked out of the FAAC meeting as they protested the deductions.

Mrs. Adeosun, who chairs FAAC, said she brought the matter to the NEC, which is chaired by Osinbajo. Governors, Central Bank Governor and others are members.

Briefing State House correspondents at the end of the NEC meeting, Mrs. Adeosun said: “Also, in my capacity as chairman of FAAC, I briefed governors on the deadlock that we have got currently in the federation account and explained what happened. And there was quite an extensive debate on what to do.

“For the purpose of this briefing, we operate NNPC as a business. We have invested public capital in that business and we have expectations of return and when that return falls lower than our expectations then the owners of this business which in this case is the Federal Government and states, need to act. So, that was what caused the deadlock yesterday (Wednesday) and we really felt the figures the NNPC was proposing for FAAC were unacceptable. We felt that some of the costs couldn’t be justified and so we have decided that rather than approve the accounts, we will go back and do further work.

“So further negotiations and interactions are going on with NNPC, as we speak. However, we did brief both Mr. President and Mr. Vice President on the deadlock and asked for their support and their forbearance in this because the consequence of this is that salaries might well be delayed in many states as a result of this. But we feel that in order to get to the accurate figures that we need, we have asked for forbearance and the governors and the Federal Government are all in agreement that we need to get to the bottom of those figures.


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