State governments can no longer use paucity of funds as excuse for not paying accumulated pension arrears considering the recent Paris Club refunds they got from the Federal Government.
Speaking exclusively to the Daily Trust, an economist, Dr. Jide Adekunle, said if the state governments are responsible enough and have financial discipline, they will utilise the lifeline which the Federal Government has given then to clear pension and salary arrears.
So far, the Federal Government has disbursed a total of N760.17 billion as Paris Club loan refunds to states.
The refunds were done in two tranches, with the latest one being N243.79 billion disbursed to the 36 states and the federal capital territory, Abuja.
“When the government released the first tranche to them, I thought the responsible thing to do then was to offset those liabilities. That did not happen,” he said.
Adekunle said paying pension and salaries was a way of boosting the economy as consumption is a major determinant of the health of the economy.
He commended Kwara State government for releasing N1 billion from its share of the refund to pay arrears of salaries in local government areas.
“Other states must toe that path. That is the honourable thing to do. Let them pay all arrears of pensions and salaries from the money,” he said.
Retirees in states are still grappling with the challenge of eking out a living without their monthly pension.
For instance, recently pensioners in Osun State stormed the state secretariat and locked the premises to protest unpaid pensions.
Similarly, state and local government retirees in Edo State recently staged a protest over their unpaid pension arrears and gratuities, adding that the state government had failed to use bailout funds to clear the liabilities.
The situation is not different from the case in Akwa Ibom where government owes retired civil servant over five years pensions and gratuities.
Adekunle said though the Paris Club loan refunds are the legitimate funds of states, the refunds should not be administered like freebies from the Federal Government.
“You know these governors inherited these funds. They may see the funds as freebies but in reality this was their entitlement deducted to pay the Paris Club loans. The wise thing to do now is to spend the money on priorities. I don’t need to emphasis that pension is a priority,” he said.