WORKERS TO GO IN POWER Bonanza
Do the Math: 2.7million Per head !
N135 billion severance package ready For an epileptic Power Sector of Non Performing Staff ? They will still get jobs in the privatised companies being set up !
FOR the reform in the power sector to work, 50,000 workers in the Power Holding Company of Nigeria (PHCN) would be sacked. However, the Federal Government is planning to pay N135 billion compensation for the workers..
Presidential Adviser on Power, Prof. Bart Nnaji, yesterday confirmed this to the House of Representatives.
He said the workers would be sacked before the Federal Government hands over the 18 companies carved out of PHCN to their new owners in the first quarter of next year.
He also informed the House that N135 billion ($900 million) severance package is being worked out by the Central Bank of Nigeria (CBN) for approbation in next year’s budget for the workers.
The Speaker of the House, Dimeji Bankole, was particularly worried since it has been established that lack of funds is no longer the bane of the power sector and since so much money has been pumped into the sector with no commensurate result.
In his presentation, the Speaker noted: “In the past two years, we have been doing all we can to ensure that the power sector is adequately funded yet, nothing has changed.”
Nnaji was in the Lower House with members of the Presidential Task Force to lobby the lawmakers on the need to come up with enabling legislations that would drive the reform.
Nnaji observed that the staff burden of the PHCN is worrisome. “There is a high operating cost in the company, gulping over N8 billion annually in which staff salaries and pension take 80 per cent of it”, he told the committee.
He said that 70 per cent of the cost of running the sector is incurred at the distribution business level. “The whole idea for the future of the sector is to cut a good deal for the workers for a more efficient power output for the country when the workers would have been been laid off. We would enter into an agreement with the new owners of the companies to absorb them.
“There is no way the new owners would work without trained and experienced workers. So, most of the workers would be fully re-engaged after entering into a new contract with the new owners.
“We are already working out a $900m (N135 billion) severance package for them with the CBN for appropriation in the next budget,” he declared.
He said that there were already strong interest from international investors in the country’s power sector.
“Essar of India plans to put in up to $2 billion of investment if the sector is reformed to logical conclusion. There are also strong interests from financiers and operators all over the world for our proposed sale of PHCN,” he said.
According to him, the privatisation of the sector would not be possible if the Electricity Power Sector Reform Act 2005, which gives the time line for the sales of the entities carved out of the PHCN, is not adjusted to accommodate the proposed dates. They are made up of 11 Distribution Companies (Discos), six Generation Companies (Gencos) and one Transmission Company (Transco).
According to the Professor, the present PHCN is indebted to suppliers and other service providers to the tune of N90 billion and it is owed N100 billion by its customers.
He lamented that “there is a severe lack of business orientation in the PHCN, coupled with inadequate expertise, especially technical, but most prevalent at the distribution level of the company.”
The Chairman, House Committee on Power, Patrick Ikhariale, said there was no alternative to the privatisation of PHCN.
He, however, assured the presidential committee that lawmakers would give support to the Task Force. “We can assure you of our full support because the issue of power is of extreme importance to every Nigerian and we will work with you to see that the sector improves,” he said.
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