“32 states may find it difficult to pay salary after COVID-19”

governance and policy expert, Dr. Tunji Ogunyemi, has said about 32 states may find it difficult to pay salaries in post-Covid-19 era.

He said that there was a possibility of a further downward review of the already reviewed Federal Government’s budget, going by recent happenings globally.

The economic historian-cum-lawyer, and who is also the acting head, Department of History, Faculty of Arts, Obafemi Awolowo University (OAU), Ile-Ife, urged the Osun State Government to meet Labour leaders to revisit the Comrade Hassan Sunmonu-led committee’s template, saying the state would be negatively impacted by the global economic downturn occasioned by Covid-19.

 Ogunyemi, who spoke on a popular radio programme:  ‘Frank Talk’, in Osogbo, said: “The Federal Government can deliberately create money by printing more money that may not be backed by productivity, to pay its workers.

“But no state can do that. Already, states are cutting their budgets significantly because of the drop in the federal allocation. What they will be sharing in June is half of what they shared in January. Only about four states can manage to survive marginally.

“The opportunity the civil servants have now is that no state can say go home, I am not paying. But states can decide to pay slashed salaries because one cannot appropriate and reprobate at the same time. So, the state can only pay from what it has. If it has nothing, what will it pay?

“We are in dire straits. Some states such as Kaduna, Delta, Plateau, Taraba, Gombe, among others are slashing salaries. 

 “Although it is rather very difficult to advise beleaguered Governor Oyetola because I know there will be a lot of calculations in his head now, to which there are few answers, the advice must be based on the foundation of the challenges Osun is facing.

“Osun pays three quarters of its income into recurrent, salaries, wages and overheads, including liabilities owed the pensioners. Osun also has a background of owing a significant debt both domestically and externally going towards the realm of N200billion.

“From that background, coupled with 30 local governments with huge civil servants, one would rather advise Comrade Sunmonu, chairman of the Committee of Government and Labour, to share some views with the governor by calling on the civil servants to know the truth about the financial status of the state.

“Politicking should end here. Some professionals can be called to that kind of meeting, especially experts in public finance and banking to let the truth be told on the status of Osun.

“When an income is far, far less to expenditure, and there is no extra capacity to generate more, it means that the state must begin to reduce wasteful expenditure.

“So, government must pursue the idea of land charges, cut down if not suspend capital expenditure to pave the way for the maintenance of minimum services of government.

“Also, for the state to stay afloat, people must prepare for the impact. They must support government and show patriotism in view of the socio-economic reality.

“Reality is staring us in the face and for the clouds to clear; it will take five years or more.”

Source: The Nation Newspaper