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The monster called monetisation policy

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The Senate

The Senate

APART from the issue of oil subsidy, no other subject has enraged and infuriated Nigerians more than the issue of the Jumbo salaries and allowances of the members of the National Assembly.
Yet in spite of the anger, the salaries and allowances are licit under the monetisation policy of the government, which was implemented in 2003.

It is the monetisation policy that enabled the former Senate President David Mark to buy so cheaply the official residence of the Senate President at Apo in Abuja- a house that should be a national heritage- and get away with it.

Ditto to the former speaker of the House of Representatives, Dimeji Bankole who bought the official residence of the speaker of the House of Representatives also at Apo at give away price and got away with it.
If we talk about the jumbo salaries and allowances for the legislators what about top civil servants who earn their jumbo salaries for life and the governors and former governors who also earn their jumbo salaries and entitlements for life.

Once we adopt the Presidential system of government we cannot run away from its excesses, and also its shortcomings. The jumbo salaries and allowances of the members of the National Assembly and the Security votes of the Governors is also part of the excesses. They must be curbed in the light of the dwindling fortunes of the Nigeria economy. Albeit, we cannot afford it.

What is monetisation? monetisation is the quantification in money terms of those fringe benefits which government used to provide for its workers as part of their conditions of service. Such benefits include residential accommodation, chauffeur-driven cars, residential furniture, utility services, etc.

This policy is only practiced in Ghana, Cameroun and other African countries. I understand that Ghana had stopped the policy in the last two months.

The proposal came from the Revenue Mobilisation, Allocation and Fiscal Commission. It was debated in the National Assembly and passed into law as ‘Certain Political, Public and Judicial office holders (Salaries and Allowances etc) Act 2002. Monetisation was clamoured for by civil servants, as conveyed in the communiqué of the Re-orientation Workshop for Directorate Level Officers in the Federal Civil Service read to the President, Olusegun Obasanjo on 14th January, 2002. The Organised Private Sector and a number of Government Agencies and Parastatals have adopted monetisation of benefits for quite some time now, for instance, CBN, NNPC, etc. I note also that the university system has its own list of monetised fringe benefits and allowances.

In other to ensure effective implementation of the policy, the Presidential Committee on the monetisation of fringe benefits in the public service of the federation was set up by President Obasanjo on November 11, 2002 under the Chairmanship of the then Secretary to the Government of the Federation, Chief Ufott Ekaette. Following the submission of the Committee’s Interim Report to President Olusegun Obasanjo and its subsequent adoption by Government, a circular detailing the newly monetised fringe benefits and the modalities for their implementation was issued on 27th June, 2003, with 1st July, 2003 as the commencement date of the programme. To sensitise the States on the implementation of the Programme, an interactive Session was earlier organized on Tuesday 17th June, 2003 to enable both the Head of Civil Service of the Federation to intimate Secretaries to State Governments (SSGs) and Head of Civil Service of the States (HCSS) in the 36 states of the Federation with modalities for the implementation of the monetisation policy. Suffice it to say the states objected to the implementation insisting that they could not afford it.

On November 27th 2003, Chief Ufott Ekaette told members of the Faculty of Social Sciences, University of Lagos under the headship of Professor Lai Olurode that “Monetisation as a public policy reform must be appreciated in the context of other reforms each of which plays complementary roles with the new overarching economic development strategy of the Obasanjo Administration called NEEDS (National Economic Empowerment Development Strategy).”

The following was approved for members of the National Assembly as part of the monetisation policy: (a) Housing Allowance-100 per cent of Annual Basic Salary (b) Transport Allowance-350 per cent of Annual Basic Salary (c) Utility Allowance-20 per cent of Annual Basic Salary (d) Domestic Staff Allowance-75 per cent of Annual Basic Salary (e) Entertainment Allowance- 10 per cent of Annual Basic Salary (f) Constituency Allowance- 150 per cent of Annual Basic Salary (g) Furniture Salary- 300 per cent of Annual Basic Salary (h) Allowance for Employment of Special Assistant- Equivalent of 25 per cent of Annual Basic Salary to be paid (i) Vehicle Maintenance and Fuelling- 30 per cent of Annual Basic Salary (j) Recess Allowance- 10 per cent of Annual Basic Salary (k) Severance Gratuity- 300 per cent of Annual Basic Salary (to be paid once in a life time) after successful completion of tenure

The following was approved under the monetisation policy for Federal Civil Servants (1) Accommodation, Grade level—01-06 (50 per cent of Annual Basic Salary), Grade level—- 07-17(60 per cent of Annual Basic Salary and Grade level—-15 & above (75 per cent of Annual Basic Salary. Transportation—- Grade level 01-17 (25 per cent of Annual Basic Salary. Meal Subsidy—- Grade level—-01-06 (N6, 000. 00), 07-10 (N 8,4000.00), 12-14 (N 9,600.00), 15-17 (N 10,800.00), Permanent Secretary (N 16,200.00). Utility, Grade level—- 01-16 (15 per cent of Annual Basic Salary), 17 and above (20 per cent of Annual Basic Salary). Domestic Servant—- Grade level 15(1 GL. 3 Step 8), 16-17(2 GL 3 step 8), PS & above (3 GL 3 step 8). Leave Grant—-01 & above (10 per cent of Annual Basic Salary. Medical—-01 and above (10 per cent of Annual Basic Salary to be paid to NHIS). Furniture Allowance—- Grade level—01-06 (NIL), 17 and above (200 per cent in five years, that is. 40 per cent of per annum). Vehicle loan—- Grade level, 01-05 (100 per cent of Annual Basic Salary), 06-07(150 per cent of Annual Basic Salary,08 and above(200 per cent of Annual Basic Salary. Driver—-Grade level——17 and above (1GL.3 step 8.)

The following was approved for the Chief Justice of Nigeria and Judges of the Supreme Court under the monetisation policy—- (a) Accommodation- to be provided by the government (with an option to be paid 100 per cent of Annual Basic Salary if opted to stay in personal house) (b) Furniture- to be provided by government (c) Medical care- to be provided by government, including members of immediate family (d) Robe- to be provided by government (e) Transport- official cars to be assigned and maintained by government (f) Security- to be provided (g) Utility- Bills to be settled by government (h) Domestic staff- to be provided (i) Entertainment- to be catered for by Government (j) Special Assistants- to be provided from within the Civil Service (k) Leave Allowance – 10 per cent of Annual Basic Salary to be paid once in each calendar year (l) Hardship Allowance- 50 per cent of Annual Basic Salary (m) Severance Gratuity – 300 per cent of Annual Basic Salary (to be paid once in a life time) after successful completion of tenure (n) Retirement Benefits- Payable on the basis of Approved Scheme of Service

In spite of the objection by the states, the Federal Government went ahead and implemented this policy on October 1, 2003 and that policy is still on till today.

The monetisation policy was given legal teeth with passage and coming into the effect of the certain political, public and judicial office holders (Salaries and Allowances etc) Act, 2002 which was extended by circular to cover all Federal Civil Servants. The law took effect from 1st July 2003 for the designated Political, Public and Judicial Office Holders, while it was extended, with somewhat modified rates of benefits, to Federal Civil Servants with effect from 1st October 2003.

At the time of his departure from office in 2007, President Olusegun Obasanjo was shocked to find out the magnitude of the monetisation of the legislators and the jumbo salaries they were to earn. He refused to sign the bill, leaving it for President Umaru Yar’Adua who signed it eventually in other to please the legislators. That’s where we are now. This issue cut across party line in the National Assembly for they are all united for it.

The monetisation policy, a policy that was meant to solve problems, has now created more problems. It is like a monster now. The question now is, can we afford the monetization policy? The answer is no. It will be unfair to talk about the jumbo salaries and allowances of legislators as a result of monetization policy in isolation without talking about other public officers benefitting from this policy. Cutting salaries by half as announced by President Muhammadu Buhari and his vice, Yemi Osinbajo is a good step. I doubt whether members of the National Assembly will follow the President’s example no matter the pressure. In fact they will tell the President that they have not come to Abuja merely to pass bills or endorse unworkable resolutions only.
As for these members of the National Assembly and other public officers benefitting from the monetisation policy, national sacrifice has to wait.

All that the President should do is to call a meeting of the stakeholders including governors, legislators, Nigerian Labour Congress, Public discussants, religious leaders, market women and other bodies and insist that the government cannot sustain any longer the monetization policy of 2003.

In the interim, he should withdraw the circular on monetisation.
If possible, he should ignite a national debate on the issue, after all he is our moral guide.

• Teniola, a former director at the presidency, stays in Lagos.



1 Comment
  • emmanuel kalu

    Pure lack of leaders. instead of the minister solving the gas supply and metering, they are forcing higher traffic on consumer, when they can’t even supply the electricity. Is there a reason that power generation plants are not made to store at least 3 month worth of gas on site. This would prevent complete shut in when there is vandalism to the pipeline. what plan does NERC have to increase generation from other source. because we depend solely on gas, and we can’t secure the supply, we would continue to have this problem.