PHCN crisis: FG insists on 15% severance package for employees Reviewed by Momizat on . Despite the threat of a nationwide strike by the Nigeria Labour Congress (NLC) in solidarity with electricity workers, the Minister of Power declared that the f Despite the threat of a nationwide strike by the Nigeria Labour Congress (NLC) in solidarity with electricity workers, the Minister of Power declared that the f Rating:
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PHCN crisis: FG insists on 15% severance package for employees

Despite the threat of a nationwide strike by the Nigeria Labour Congress (NLC) in solidarity with electricity workers, the Minister of Power declared that the federal government will not shift grounds on the issue of  severance package for the electricity workers. 

Professor Bart Nnaji at a press conference in Lagos on Thursday, dismissed the agitations of the employees of the Power Holding Company of Nigeria, (PHCN) and he wasted no time in dismissing the perception that the workers were going to get a pittance for their severance package.

Stating the figures clearly, Prof Nnaji stated that on part law, the total amount of severance package, entitled by the electricity workers is N144 billion while what the workers are asking for adds up to N430 billion.

“PHCN as a company does not make this much and where are they expecting the government to get the funds, which they are demanding? We have calculated what each worker will get, which of course shows government’s generosity, but it is surprising to see the unions demand this high” he said.

The government is in the process of privatising the company but the workers are demanding a 25 per cent severance package as against the 15 per cent the government is offering.

They (electricity workers) say they want 25 per cent in line with their own internal scheme known as ‘Superannuation’, but the government says it would only pay 15 per cent.

The Minister also outlined the offers made to the workers by the government to include payment of repatriation allowance, long service awards, 13th month salary, and monetisation of unspent leave, amongst others.

On pension, Prof Nnaji insisted that the government would only abide by the provisions of the Pension Reform Act, 2004 because the NEPA/PHCN Superannuation Fund Scheme would be terminated from June 30, 2004.

“Government shall transfer accrued rights of staff as of June 30, 2004 to their Retirement Savings Account. The government will provide 7.5 per cent minimum employer contribution on active employees’ monthly emoluments from July 1, 2004 through June 30, 2012” he explained

“Government will also pay the outstanding 7.5 per cent for the employees and the sum of N34.4billion is estimated for 15 per cent contribution, which is 7.5 per cent employer contribution and 7.5 per cent employee contribution.”

WHAT IS SUPERANNUATION?

It is some kind of internal pension scheme ran by the management of PHCN in conjunction with the unions in the sector.

25 per cent is supposed to be deducted from each staff’s  monthly salary to fund the scheme which is used to pay off retiring employees.

But reports say rather than do this, the management of the power company, simply voted funds to finance superannuation from its internally generated revenue.

The end result is that the scheme ran into a deficit of about N85 billion as at 2004 and now, the unions are demanding, according to the government, is even far more than that.

Prof. Nnaji however stated that he has already authorized an investigation panel into the operation of the superannuation scheme.

He referred to the PHCN superannuation as an extremely illegal scheme and a Ponzi scheme, wondering why the company was allowed to run the scheme for so long.

But the PHCN workers have continued to insist they would not back down on their demand, ahead of a planned industrial action to shut down the nation’s power grid, despite government insistence that it won’t go beyond its limit.

 

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  • iakindele

    If you all like shut down the entire
    power…..when you are active workers, we do not get light anyway. Government not
    only to blame….your high level managements needs to be crucified. You are
    only going to give Dangote and co that sell generators more sales, as you have
    been working for them in the past. Your children will wake you up one day and
    ask you questions that will put you all to shame.

  • http://profile.yahoo.com/5QVFJXKT3CXTUUKAHLVT33ABOI Temitope

    I think Nigerians need to be enlightened about the unfairness of the Federal Government and most especially the so called Proff, Bart Nnaji. The hidden truth is that, for a company to be privatized, there should be an asset evaluation, which includes both physical and man power asset. Based on this evaluation the worth of the company in question is established and then investors can do their bidding based on the worth. It is however different in the case of PHCN because the whole privatization process is a fraud. The companies coming to take over are foreign but I can tell you they are just fronting for our politicians, who have a franchise agreement with these companies, and in truth, these politicians are the ones buying out PHCN in the name of privatization, hence the reason why PHCN was under evaluated so they  can buy it cheaper. I give Nigerians 10 years from now, and i can tell you that we’ll be paying as much if not more than the UK for Electricity bill and I can also say that the power by then will still not be stable as they are promising now. The staffs are entitled to their total severance package of 25% and these are terms of their condition of service before taking up employment. Suddenly, the Proff now calls the Superannuation Scheme a scam after how many years of him as ministers, he never saw it as a scam till now? He’s just another sycophant of GEJ trying to loot our treasure in Nigeria. Until true federalism is practiced in Nigeria, where all states fends for their needs, Nigeria will not move forward with people like Bart in the helms of affairs at the center.

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