Ajaero calls for review of power sector’s reform
As Nigerians await improvement in power supply based on the promises of the present administration, the controversy surrounding the privatisation of Power Holding Company of Nigeria (PHCN) has continued unabated. The National Union of Electricity Employees (NUEE) has joined its voice in the clamour for all encompassing change in the sector. Specifically, he called on the government to pay all outstanding entitlements to workers affected by the privatisation scheme. In an interview with journalists ,including YETUNDE EBOSELE in Lagos, the General Secretary of NUEE, Joe Ajaero, bares his mind on how to ensure regular power supply, improved meter supply system, charges and how to maintain cordial working relationship, among others.
What is the up-date on reported plans to liquidate Power Holding Company of Nigeria (PHCN)?
After the so-called privatisation, people were supposed to be paid their entitlements. If you are liquidating a company, you must address the creditors, and the first in the issue of creditors is employee creditors.
Under the Company and Allied Matters Act (CAMA), employee creditors are paramount. The Nigerian Electricity Liability Management (NEMCO) was set up to take over the core assets of Power Holding Company of Nigeria (PHCN) since it has an old work force and a pull of retirees so that their pension will continue.
Some of the houses were placed on lease and moneys were coming in. So, the issue of liquidation wasn’t even paramount because ordinarily the 18 successor companies were part of PHCN.
So, PHCN dissolved into 18 successor companies and they were operating. Then we had a common pension fund that was operating in Nigeria Electric Power Authority
(NEPA) before government said they are going to pay the gratuity and pension or workers after privatisation.
But, as we speak, government has not fulfilled that obligation. About 50, 000 staff of PHCN has one case or the other. About 5, 000 of that number none of them has been paid their gratuity or severance two years after privatisation and most of them are not working.
Some of them are dying. We have over 1, 000 death benefits. They have not paid next of kin of some of the people who died in active service. There are people who they did not pay their leave bonus; some they didn’t pay then their bulk rent because we pay bulk housing once in a year.
We normally put the people that will collect in January, March, and April. Those that were supposed to collect from October to December, nobody paid them. So, if your monthly housing is 10, 000, nobody will pay you the 10, 000 at the end of the month; they will pay you 120, 000 either at the beginning or at the end depending on where you fall in to enable people pay house rent in bulk. So, many people fall under this category and they have not paid them. The major one that cut across the board was that government signed agreement with us around June 2012 or thereabout and peoples’ entitlements were calculated up to that month. By that time, if you had worked for 10 years up to June 2012 government did not pay this entitlement till October/November 2013 and there was a period of 16 months in-between. Now, in paying that entitlement, you pay the person maybe those 10 years when there is additional 16 months entitlement and even pension contribution. And when they started paying, we said when we signed an agreement with you, we didn’t ask you not to pay it, and it was in the end that it was up to June this year.
Now, this additional period is not a national service; can we have this additional payment? And we started talking. At a stage, they said they were going to pay only pension, that is 7.5 per cent and we said okay there is the gratuity component; there is the severance component, where is that? All of a sudden, Joe Gadzama said he has been appointed liquidator.
From nowhere, Gadzama said he has been appointed liquidator of PHCN. So, the day he wanted to go and take over we matched there; we were shocked that somebody who has been appointed a liquidator has not asked for the creditors.
So, that was how we started engaging him. That was why we went to court, led protests, wrote the NBA (Nigerian Bar Association).
And at the same time, the Senate and even Mr. President are trying to ask questions on what happened in PHCN. Unfortunately, the document he had, they gave him six months contract to do the job. As at the time he went there to take over, the six months had elapsed, and we asked if it renewed. Those are some of the issues surrounding it, and unfortunately, the Federal Government is paying unnecessary silence on the privatisation of PHCN. The Federal Government divested 51 per cent. Where is 49 per cent? You sold 51 per cent and handed over 100 per cent to the investors. What type of bargain is that?
The investors, the DICOSs, if they were collecting N1 billion in some stations, fixed the tariff increase twice pre and post privatisation. Some of them are making up to N2 billion to N3 billion. Now, if government has 49 per cent or even 40 per cent what profit have they declared to government?
Why did government abandon almost everything including staff quarters among none core assets to these people? who are these people? Can Federal Government publish the names of the people they sold these PHCN, GENCOs and DISCOs to? We want to know them. Now, the people answering Chairmen of Boards of these companies can they show us evidence that they have one per cent share in any of these companies? I challenge any of them who say he is chairman of these DISCOs or GENCOs. Where were some of the companies before now? Where they companies that were registered a month or two before privatisation? That’s what we want to know. So, these are issues; as I said, privatisation has not really taken place. Some of the companies did not bid. Somebody will bid high, like N100 million and another person will price N30 million and the law says if the person that priced N100 million is unable to pay the second bidder takes over. So, that day the person that priced N100 million will not pay. You call the person that priced N30 million. Is that the value of the place? So, those are the kind of things that happened that we say that for us to take the current government serious on all these issues, we have to revisit some of these things to know actually if there was privatisation or not. To find out whether some people were settled to say hold this one or the other one. And that is why there is no improvement in electricity supply.
Allegation of witch-hunt is used each time the present Government makes effort to address critical or controversial policies of the past administration. What do you think is responsible for this?
I was a victim during the era of the Peoples Democratic Party (PDP) led Federal Government. In one of the arrest, the Economic and Financial Crimes Commission (EFCC) came here to pick me up on allegation that I wanted to go and take power supply off a PDP rally in Eagles Square. There was no threat of strike; there was no statement from me, but I had to be out of circulation for that period because I said that there allegation of fraud associated with the privatisation. This thing dates back to 2010 when I started complaining about this issue. So, it’s not the issue of PDP saying they are being witch-hunted, it is an issue that even the labour union has been complaining even before PDP was re-elected in 2011. So, it goes beyond party; this is not a party thing. We are talking of electricity to Nigerians and how a national asset was sold to people, how people probably took loans from Nigerian banks to buy Nigerian assets when the law says the whole essence is to bring foreign direct investment. It is for you and I to find out whether there is one dollar that entered into Nigerian economy. If people have said we have 4, 000 Megawatts from former PHCN and you now have 18 companies and you still have 4, 000 MW is that privatisation? Is that reform? These are questions that we have been asking.
Did you raise these same issues during the course of the privatisation?
There was nothing we did not do. We were called names. We were demonised by the media. There is no security agency in Nigeria that I wasn’t there guest. That was the situation up to this moment and PHCN was the only company in the whole world that was privatised with soldiers, by force. In fact, they took over the headquarters. The Customs were used, the State Security Service (SSS) was, Police, Civil Defence everywhere; this is using federal might. So, these issues were raised in court, in the streets, protests everywhere. We even dragged in the international community. We held a workshop in the Villa. There we challenged the issue and they saw they were hollow and they said it must go ahead, not based on any logic. So, what we are doing now is post-mortem. Two years after, where are we? You remember I said then that Nigerians will speak last. They (investors) have sacked and sacked and they will continue to sack. The investors are saying they are not making profits and they keep on increasing tariff so that they will equally not allow government to get its own 40 per cent. The 10 per cent meant for the workers, which is contained in the Privatisation Act that the workers or employees will get equity share of 10 per cent has not been forthcoming two years after yet you are liquidating. So, we cannot be accused of not raising these issues because we went to National Assembly, we went to the streets, we did all that we needed to do, but, there were powerful people in this country.
But, some of the investors are complaining that they are losing money instead of making profit?
Let me agree with them a little. They bought something that they did not know now they have realised. The only station that was not making profit even before privatisation was Yola, because PHCN was holding more than 50, 000 workforce. Today, they have reduced it more than half. But, PHCN was still paying salaries, they were not taking grants from government, they were still running the place. Now, they came in and ask for tariff increase a month or two before privatization so that they will make profits and government conceded that to them, which PHCN did not have. So they got tariff increase, their revenue shot up, and after that they have gotten another tariff increase. And government has even been subsidizing them; I think government paid about N200 billion. Those people are not telling you the truth and they won’t. If they say they are not making profits it is to make sure they under-declare what they have. Tell them I said they are making maximum profit and I stand to be corrected, but they are under-declaring it. The reason is to make sure they don’t pay the real tax. When you under declare profit, they tax you are going to pay will equally be low. So, that argument does not hold water. It was only Yola that was not making profit even before privatisation, but because it was PHCN, it was uniform; whatever profit that people make from Lagos and other areas we use it to pay the salaries. Now, to privatise Yola you had to pair Yola with another area. So, Yola was paired with Ibadan zone and privatised. To show you the complexity of Bureau of Public Enterprises (BPE), the company that bought Yola with Ibadan now declared ‘Force Majeure’ for Yola, to say we are no longer interested in Yola and handed Yola over to the Federal Government. So, government has already taken over Yola. So, if there is any other area, that clause was contained in the agreement, that if they are not making profit they will declare Force Majeure, government will balance them money and take over. But it is not like that.
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